Cost-benefit analysis of single-family foreclosure alternatives

Over the last ten years, single-family mortgage lenders have become more aware of the financial benefits of finding alternatives to foreclosure for borrowers who default on their mortgage obligations. In this article, expected costs of foreclosure alternatives are parameterized to solve for minimum probabilities of borrower success necessary to make pursuing them profitable for lenders. These break-even probabilities are found to be very insensitive to changes in a variety of factors, including interest-rate environments and time horizons. Simulations are performed across house-price-deflation scenarios, loan-to-value ratios, and post-default cure rates. Stochastic processes are introduced through time distributions for foreclosure processing, property disposition, and house-price appreciation.     

Commercial Mortgage-Backed Securities: Prepayment and Default

One of the major developments in real estate finance during the 1990s was the emergence of a viable market for commercial mortgage backed securities. The growth in this market has spurred greater interest in empirical and theoretical research on commercial mortgage default and prepayment. We employ a competing risks model to examine the default and prepayment behavior of commercial loans underlying CMBS deals. We find that changes in the yield curve have a direct impact on the probability of mortgage termination. Furthermore, we do not find any statistical relationship between LTV and prepayment or default.     

Have Australia's tourism strategies incorporated climate change?

Tourism is widely acknowledged as a key contributor to climate change, but it remains unclear how the tourism industry has been planning for climate change in practice. This paper conducts the most comprehensive critical review of Australia's tourism policy and planning documents to date. The paper explores the complex challenges posed by climate change to tourism and how tourism policy has been adapting over a 15-year period. Drawing on a longitudinal data-set of 477 Australian tourism policy and planning documents at the national, state, regional and local level, this research analyses the strategic discourse on climate change using content analysis and bibliometrics. The findings reveal opportunities, challenges and strategies for the tourism industry to contribute to the sustainable management of climate change. Opportunities include developing more “green” products, while strategies include establishing and/or participating in collaborative climate change schemes and strengthening dialogue surrounding climate change to aid the implementation of sustainable practices. Future research should consider the broader policy-making environment, such as the stakeholders, power and interest dynamics when analysing tourism strategies in relation to climate change.     

Fostering visitors’ pro-environmental behaviour in an urban park

Recognizing the increasing importance of sustainable environment, this research explored visitors’ pro-environmental decision-making process in an urban park context. This study investigated the relationships among attitudes, subjective norms, perceived behaviour control, positive and negative anticipated emotions as well as behavioural intentions. The results suggest that positive anticipated affects positively influenced low-effort and high-effort pro-environmental behavioural intentions. In addition, positive anticipated affects mediated the relationship between cognitive factors and behavioural intentions. Interestingly negative anticipated affects did not influence behavioural intentions. Further analysis revealed subjective norm was the strongest predictor of intentions, especially the low-effort pro-environmental behavioural intentions. The research advances the conceptual understanding of the role of each construct in generating park visitors’ intentions to perform environmentally responsible behaviours while visiting an urban park.     

A Note on Hybrid Mortgages

We extend previous research on traditional one-year adjustable-rate mortgages (ARMs) by analyzing the performance of 3/27 hybrid instruments. Under this contract innovation, which first appeared in the mid-1990s, note rates are fixed for three years after which they convert to a traditional one-year adjustment schedule with periodic and lifetime caps. We find high rates of prepayment, particularly at time of initial rate adjustment, and relatively high rates of default, as would be consistent with the payment shock that often affects adjustable-rate loans.     

Pricing effects in Fannie Mae agency bonds

As a government-sponsored enterprise, Fannie Mae enjoys certain advantages over other firms. The extent of these advantages, while widely discussed, have not yet been fully quantified. This paper empirically examines the returns to Fannie Mae general obligation bonds under the assumptions of the Arbitrage Pricing Theory. The model provides an explicit method for estimating the risk premium on Fannie Mae bonds. The results indicate that liquidity and tax effects are important in explaining the returns to Fannie Mae bonds. The results also indicate that the market does not incorporate changes in the riskiness of the mortgage market into the returns on Fannie Mae bonds. The results provide support for the contention that Fannie Mae, as a government sponsored enterprise, enjoys a significant advantage over other firms in the capital market.     

Captivate: Building blocks for implementing active learning

In this study, the authors propose a set of key elements that impact the success of an active learning implementation: content delivery, active learning methods, physical environment, technology enhancement, incentive alignment, and educator investment. Through a range of metrics the authors present preliminary evidence that students in courses implementing these elements learn more while exerting similar effort, demonstrate greater understanding of course content, and establish closer connections with fellow students as well as instructors.     

REIT Economies of Scale: Fact or Fiction?

The real estate industry has recently witnessed significant and pervasive consolidation with further growth and consolidation generally viewed as inevitable. For example, between 1990 and 1997, growth in average net real estate investments by large REITs outpaced growth in average net real estate investments by small REITs by 13 percent. However, no systematic study of the benefits of this consolidation exists. This research studies whether or not there are gains to consolidation due to economies of scale from size, brand imaging, and informational gains from geographic specialization. Our sample consists of 41 multifamily equity REITs, for whom financial and property level data are available in the SNL REIT Database. Using this data, we construct shadow portfolios that mimic each REITs exposure to changes in local market conditions. Our results show no size economies, that branding in real estate is allusive, and that geographic specialization, in agreement with Gyourko and Nelling (1996), has no significant benefit.     

Cruise infrastructure development in Auckland,New Zealand: a media discourse analysis (2008–2016)

The deployment of mega cruise ships is putting pressure on ports to redesign or construct new infrastructure. However, there is limited research which considers the media discourse surrounding this development over a longitudinal period. The aim of this paper is to explore how the media portrays the cruise infrastructure debate in the complex and highly contested political environment of Auckland, New Zealand. Thematic analysis was used to determine the most salient themes found in 103 published articles. Results revealed the media shaped the debate, focusing on a volatile political environment characterised by distrust, a lack of transparency and differing objectives among key stakeholders. An outcome of this research is a rich, in-depth case study of cruise infrastructure development presented through the lens of media discourse. Future research should focus on the perceptions of decision-makers, stakeholders and the community using hedging and framing to probe the media discourse surrounding cruise infrastructure development.