How taxes and required returns drove comercial real estate valuations over the past four decades John V. Duca, Patric H. Hendershott and David C. Ling
By: Duca, John V
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Contributor(s): Hendershott, Patric H | Ling, David C.
Material type: 
ArticlePublisher: 2017Subject(s): PROPIEDAD INMOBILIARIA | DEPRECIACIÓN | COMPRAVENTA | IMPUESTOS | ESTADOS UNIDOS
In:
National tax journal v. 70, n. 3, September 2017, p. 549-584Summary: We document the evolution of U.S. tax law regarding commercial real estate (CRE)since 1975, noting changes in income and capital gains tax ratesand tax depreciation methods. The most prominent changes were in the 1981 and 1986 Tax Acts, but numerous significant changes occurred in the last dozen years.We then computeboth the present value of tax depreciation per dollar of acquisition price and aneffective tax rate for CRE. We explain the quarterly variation in CRE capitalizationrates using an error-correction framework and find that the long-run estimates arestatistically significant in the way theory wouldsuggest. Moreover, the required financialasset return and the tax depreciation variables temporally predict (.cause.) capitalization rates in the long run, but not vice versa.
| Item type | Current location | Home library | Call number | Status | Date due | Barcode |
|---|---|---|---|---|---|---|
| IEF | OP 233/2017/3-2 (Browse shelf) | Available | OP 233/2017/3-2 |
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Disponible también en línea a través de la Biblioteca del Instituto de Estudios Fiscales. Resumen. Conclusión. Bibliografía.
We document the evolution of U.S. tax law regarding commercial real estate (CRE)since 1975, noting changes in income and capital gains tax ratesand tax depreciation methods. The most prominent changes were in the 1981 and 1986 Tax Acts, but numerous significant changes occurred in the last dozen years.We then computeboth the present value of tax depreciation per dollar of acquisition price and aneffective tax rate for CRE. We explain the quarterly variation in CRE capitalizationrates using an error-correction framework and find that the long-run estimates arestatistically significant in the way theory wouldsuggest. Moreover, the required financialasset return and the tax depreciation variables temporally predict (.cause.) capitalization rates in the long run, but not vice versa.
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