Faculty members of the Wisconsin Real Estate Program are active researchers and academics at the frontier of knowledge in the fields of real estate economics, housing and finance. They regularly have articles published in top academic journals and frequently participate in conferences around the world. Below are selected research highlights and a brief note about the real-world impacts of their research.
Alina Arefeva, Assistant Professor
Current Research: Research focus is the interaction of institutions and economic policies with real estate and financial markets.
Research Impact:
Opportunity Zones (OZ) Policy
Professor Alina Arefeva studies the OZ policy which was designed at boosting job growth. The paper uses a census of establishment-level data on employment to identify the effect of OZ related capital gain tax reduction policies on business and job creation. The study shows that it indeed increased the employment growth in firms located in OZ census tracts by 3 to 4.5 percentage points from 2017 to 2019.
Media Articles:
- Brookings Institute: Opportunity Zones have had minor impact on labor markets so far
- PEW: Opportunity Zones Don’t Boost Economic Activity, Research Says
Yongheng Deng, Chair and Professor and John P. Morgridge Distinguished Chair in Business
Current Research: Real estate research is tightly linked to various aspects of our urban space and society. Rising house prices often trigger debates on housing affordability and financial stability globally. A world in which only a few can afford housing is not sustainable. Today, however, most mega-cities worldwide, especially those superstar cities that are growing rapidly, face major challenges in providing affordable housing for their residents. Besides, the impacts of climate risk and social injustice have compelled us to rethink the way we evaluate the commercial and residential real estate markets. Therefore, Professor Deng’s research last year focused on issues related to sustainability, social-economic equity, climate risks, and their impact on real estate, mortgage, housing markets, and local labor markets.
Research Impact:
Technology and the Educational Gap: A Digital Footprint Approach
Rising inequality hurts economic growth. Unequal quality of education is a contributing factor to income inequality in the U.S. and around the world. The emergence of new technologies such as iPads and online teaching has generated both new hopes and concerns for their implications for educational equality. Professor Deng and his coauthors study how the use of online teaching technology affects the education gap. They propose a digital footprint approach based on smartphone usage to create variables that are otherwise hard to measure, including identifying families with children who graduate from primary school, the type of schools they go to, and family economic status based on the housing prices of their residential locations and shopping behavior. They find that the relative advantage of children from better-to-do families rises with the duration of online teaching. Furthermore, their digital footprint approach suggests that parental behavior, including their ability to spend time with their children, are an important part of this widening gap in the educational outcome.
Climate Risks and Mortgage Default
Professor Yongheng Deng and Professor Timothy Riddiough investigate the relationship between temperature and residential mortgage default using fine-scale weather information and comprehensive loan performance data. They identify a significant high temperature-to-mortgage default relation. One additional day of mean temperatures above 90oF in each month for the last 12 months is associated with a 2.45% and 2.50% increase in the probability of 30-day delinquency and 90-day+ delinquency, respectively. They find that households treated to high-temperature: i) show elevated rates of default and prepayment, particularly in high-amenity locations that are vulnerable to sea-level rise risk, ii) are more likely to relocate conditional on prepayment, and iii) are more likely to migrate to cooler parts of the country. Localized high-temperature shocks seem to intensify latent household concerns regarding the longer-run costs of climate change, which then triggers adaptive relocation decisions.
Awards and Citations:
- Received the 2021 Erwin A. Gaumnitz Distinguished Faculty Research Award from the Wisconsin School of Business.
- Research works have received more than 8,000 Google Scholar citations.
Lu Han, Professor and Nathan F. Brand. Chair
Current Research: Her research interests are at the interface of urban economics, market microstructure, industrial organization and real estate finance. She has conducted extensive research on topics such as affordability, sustainability, land use, market microstructure, housing and mortgage policies.
Research Impact:
To Own or to Rent: The Effects of Transaction Taxes on Housing Markets (with Rachel Ngai and Kevin Sheedy)
Using sales and leasing data, this paper finds three novel effects of a higher property transaction tax: higher buy-to-rent transactions alongside lower buy-to-own transactions, despite both being taxed; lower sales-to-leases and price-to-rent ratios; and longer time- on-the-market. This paper explains these facts by developing a search model with entry of investors and households choosing to own or rent in the presence of credit frictions. A higher transaction tax reduces homeowners’ mobility and increases demand for rental properties, which reduces the homeownership rate. The deadweight loss is large at 113% of tax revenue, with more than half of this due to distorting decisions to own or rent.
Cool Cities: The Value of Urban Trees (with Stephan Heblich, Chris Timmins, Yanos Zylberberg)
This paper estimates the value of urban trees and shows their ability to moder- ate temperatures during heatwaves and reduce energy consumption. The empiri- cal strategy exploits an ecological catastrophe—the Emerald Ash Borer infestation in Toronto—to isolate exogenous variation in neighborhood tree canopy changes and finds that a single tree adds 0.45% to property prices within a postal code; the hardest-hit areas lost 7 percentage points in tree canopy cover, resulting in a 7% property price decline. Trees significantly cool urban areas and save energy, but their total amenity value surpasses the value of these ecosystem services, high- lighting their cost-effectiveness in combating urban heat island effects.
Media Articles:
- VoX EU Column: The Effects of Transaction Taxes on Housing Markets
- VoX EU Column: Cool Cities: The Value of Urban Trees
- Nada Gratis: Cool Cities: The Value of Urban Trees (Spanish Version)
Presentations and Activities:
- Organizing Committee for Notre Dame Conference on Housing Markets and Housing Affordability, 2024
- American Real Estate and Urban Economics Association Best Paper and Junior Scholar Best Paper Awards Committee, 2016, 2021, 2022, 2023, 2024.
- Scientific Committee for Conference on Housing Affordability, Office Real Estate, and Remote Work, 2024
- Scientific Committee for 2nd CEMLA/Dallas Fed Financial Stability Workshop, 2023.
- Co-organizer for Asian Bureau of Finance and Economic Research (ABFER) Real Estate and Urban Economics Program, 2023-present
- Co-organizer for Real Estate Economics Special Issue Conference on Sustainability and Affordability, 2022-2023
- Society for Financial Studies (SFS) Cavalcade Conference Program Committee, 2018- present
- Conference on Low Income Housing Supply and Housing Affordability, Scientific Committee, 2018-present
Awards:
- State of the Art Lecture at the Canadian Economics Association Annual Meeting, Montreal, 2025
- Keynote Speech at the ECHOPPE Conference on the Economics of Housing and Housing Policies, Toulouse School of Economics, 2024
- Erwin A. Gaumnitz Distinguished Faculty Research Award, Wisconsin School of Business. 2024
Tim Riddiough, Professor and James A. Graaskamp Chair in Real Estate
Current Research: Research is focused primarily on issues associated with the performance of institutionally owned private equity real estate (PERE). Topics/papers include developing new methods to benchmark PERE investment performance, analyzing investable persistence in PERE, examining the effects of LP networking on investment performance and examining if LP’s exhibit “hot hands” in their investment performance. All of this work is joint with Ph.D. student Da Li. Also has written a paper joint with Yongheng Deng and Congyan Han (Ph.D. student) that looks at the relationship between climate change and mortgage default.
Conference Presentations:
- 2021, “The Weather Channel: High Temperature, Climate Change and Mortgage Default,” Paris Finance Conference.
- 2021, “Deciphering Private Equity Incentive Contracting and Leverage Choice,” 13th ReCapNet conference on digitalization and real estate, Stockholm.
- 2021, “Collateral Reallocation in Commercial Real Estate in the Shadow of COVID-19, Boston Fed conference on leverage and the macroeconomy.
- 2020, “Pension Funds and Private Equity Real Estate,” Institute for Private Capital, University of N. Carolina.
Abdullah Yavas, Professor and Robert E. Wangard Real Estate Chair
Current Research: Current research projects focus on mortgage contracts and asymmetric information in mortgage securitization, and the impact of hurricanes on residential and commercial property prices.
Research Impact:
Hurricanes and local housing markets
Professor Abdullah Yavas investigates whether the local housing markets can be affected by the occurrence of a large-scale but distant hurricane without direct impact. The study finds that the impact of a property’s flood risk exposure on its value varies over time, with a price penalty of 4% in the hurricane striking period. By contrast, within a quiet hurricane period, properties within high flood hazard zones demand a price premium ranging roughly from 4% to 6%, which may represent the price impact of water-related amenities. The premium declined significantly upon Hurricane Sandy.
Presentations and Activities:
- Served as the editor of Real Estate Economics, the leading academic journal in real estate
- Served as elected president of the American Real Estate and Urban Land Economics Association (AREUEA), the leading academic association in real estate.
- Member of the Advisory Board of the Real Estate Research Institute, the research arm of Pension Real Estate Association
- Presented and discussed papers in numerous conferences and gave seminars at various universities around the world in the past year.
- Quoted in a recent article in the Washington Post, This Block Used to be for First-Time Homebuyers. Then Global Investors Bought In.
Dayin Zhang, Assistant Professor
Current Reserach: Current research discovers that the spread of COVID-19 leads to reduced customer visits to the retail businesses, thus a rise of commercial mortgage defaults. The financial pressure faced by the defaulted mortgage borrowers makes them harsher in evicting distressed tenants, which leads to more business closures.
Research Impact:
COVID-19 Impact on Commercial Real Estate
Professor Dayin Zhang discovers that the spread of COVID-19 leads to reduced customer visits to the commercial retail businesses, hence a rise of commercial mortgage defaults. The financial pressure faced by the defaulted mortgage borrowers makes them harsher in evicting distressed tenants, which leads to more business closures.
Media Articles:
Christopher Timmins, Gary J. Gorman Affordable Housing Professor
Current Research: Recent research has focused on measuring the costs associated with exposure to poor air quality, the benefits associated with remediating brownfields and toxic waste under the Superfund program, the valuation of non-marginal changes in disamenities, and the causes and consequences of “environmental injustice”.
Research Impact:
HUD Subcontract Research on Selective Advertising
Presentations and Activities:
- Keynote address at Jinan-SMU Urban Economics Conference on housing and environmental justice
- Seminar presentation at University of Oregon on gentrification and displacement
- Research papers presented at
- Association of Environment and Resource Economics Annual Meetings (Washington DC)
- IU Affordable Housing Conference
- NBER Environment and Energy Economics and Real Estate Economics conferences
- Moderated Real Estate Club Sustainability Panel
- Moderated Neutral Project Panel on Sustainable Development
Publications:
- “The Costs of Exposure to Industrial Livestock Operations” with Kay Jowers and Yu Ma. Forthcoming in Land Economics
- “Frictional Sorting,” with Wenquan Liang and Ran Song. Forthcoming in International Economic Review.
- “The Association between Long-term PM2.5 Exposure and Risk for Pancreatic Cancer: An Application of Social Informatics,” with Nrupen Bhavsar, Kay Jowers, Lexie Z. Yang, Xuan Lin, Sarah Peskoe, Hannah McManus, Lisa McElroy, Mercedes Bravo, Eric Whitsel, and Christopher Timmins. Forthcoming in American Journal of Epidemiology.
- “The Fertility Consequences of Air Pollution in China,” with Xuwen Gao and Ran Song. Journal of the Association of Environmental and Resource Economists. Vol. 11, No. 3 (2024), pp.657-688.
- “Recent Findings and Methodologies in Economics Research in Environmental Justice,” with Lucas Cain, Danae Hernandez-Cortes and Paige Weber. Review of Environmental Economics and Policy. Vol.18, No. 1 (2024), pp.116-142.
- “Racial Gaps in Federal Flood Buyout Compensations,” with Kay Jowers and Lala Ma. AEA Papers and Proceedings. Vol.113 (2023), pp.451-455.
- “Information, Migration, and the Value of Clean Air,” with Xuwen Gao and Ran Song. Journal of Development Economics. Vol. 163 (2023), pp.1-25.
- “The Damages and Distortions from Discrimination in the Rental Housing Market,” with Peter Christensen. Quarterly Journal of Economics. Vol. 138, No. 4 (2023), pp.2505-2557.
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