REAL ESTATE AGENT AND SELECTION BIAS

Abstract

This dissertation provides the first analytical study of the relationship between agents' sales performance and selection bias. In addition, the effects of top agents on time-on-market (TOM) and sales price are analyzed. By using data from single listings with one major agency firm to control for brokerage effects, the results obtained in this study indicate that there is no significant relationship between the characteristics of properties and the likelihood of it being sold by top agents. It is assumed that top agents could and would choose the type of properties to sell. The key results are that most characteristics of properties do not affect the selection of properties sold by top agents. In addition, on average, top agents sell properties that are significantly of higher value than those sold by non-top agents. However, there were no significant indications that top agents are able to reduce TOM and fetch higher sales price than non-top agents.