REM 300 Study Guide - Final Guide: Earnings Before Interest And Taxes, Net Lease, Property Management
3 Feb 2018
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Exam mac arena exam seat #346 row 22 29. Market: voluntary exchange of goods and services among owners: real estate space market (rental market) Space market (interior property): market for usage of real property. Tenants exchange rent with landlords for right to use land and built space. Demand: individuals/households/firms who want to use space for consumption/production purposes. Supply: real estate owners who rent or lease space to tenants. Rent: price of right to use space for period of time; measured in $/square foot/year, $/month/unit. Determined by interaction of supply/demand forces; supply/demand are effected by government policy. Equilibrium: when quantity of space demanded equals quantity supplied. Principle of supply/demand (market rent) = equilibrium price directly related to changes in demand and indirectly related to changes in supply. Space market is highly segmented, tends to be local in nature and specialized by property usage; within each segment/submarket, same good may have a different equilibrium price.
