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An investigation of the linkage between economic cycles and commercial property cycles, and their impact on the income approach of valuation: case of Windhoek
Studies conducted in other countries shows that economic cycles and commercial property cycles exist, and that a relationship exit between the two cycles. Few research points to the cyclicality of both cycles to have an impact on property valuations. The aim of this study was therefore to establish...
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| Format: | Thesis |
| Language: | English |
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Department of Construction Economics and Management
2023
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| _version_ | 1867613225130917888 |
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| access_status_str | Open Access |
| author | Katjihingua, Else |
| author2 | Mooya, Manya M |
| author_browse | Katjihingua, Else Mooya, Manya M |
| author_facet | Mooya, Manya M Katjihingua, Else |
| author_sort | Katjihingua, Else |
| collection | Thesis |
| description | Studies conducted in other countries shows that economic cycles and commercial property cycles exist, and that a relationship exit between the two cycles. Few research points to the cyclicality of both cycles to have an impact on property valuations. The aim of this study was therefore to establish whether the Namibian economy and the Windhoek commercial property market are cyclical, and if a relationship exist between the two. The study further aimed at establishing whether the cyclicality of both the economy and the commercial property market have an impact on the valuation of commercial properties in the Namibian context. The three research objectives allowed the research to identify the variables required to establish both economic and commercial property cycles, and the possible challenges faced by valuers using the income approach to value commercial properties during peaks and troughs of these cycles. The mixed-use approach was employed using a literature review to identify the variables required to establish both cycles followed by a secondary analysis. The research made use a questionnaire to gather data on challenges faced by valuers when valuing commercial properties during the different economic and commercial property markets environments. The research found that both economic and commercial property cycles do exist and that they are procyclical and countercyclical under certain variables. A countercyclical relationship exists between GDP and the commercial property vacancy rates. A countercyclical relationship exists between inflation and retail vacancy rates and office cap-rates. A procyclical relationship exist between interest rates and the retail vacancy rates and office cap-rates. The results revealed that during or near a peak of both economic and commercial property cycles, data is easily available and accessible making it easier to value commercial properties using the income approach. However, data shows that during or near economic and commercial property cycle troughs, market data is rare and unreliable making it difficult to value commercial properties. |
| format | Thesis |
| id | oai:open.uct.ac.za:11427/37536 |
| institution | University of Cape Town (South Africa) |
| language | eng |
| last_indexed | 2026-06-10T12:32:45.765Z |
| license_str | Not specified — see source repository |
| provenance_str_mv | Harvested via OAI-PMH from UCTD — University of Cape Town Open Access Repository |
| publishDate | 2023 |
| publishDateRange | 2023 |
| publishDateSort | 2023 |
| publisher | Department of Construction Economics and Management |
| publisherStr | Department of Construction Economics and Management |
| record_format | dspace |
| source_str | UCTD — University of Cape Town Open Access Repository |
| spelling | oai:open.uct.ac.za:11427/37536 An investigation of the linkage between economic cycles and commercial property cycles, and their impact on the income approach of valuation: case of Windhoek Katjihingua, Else Mooya, Manya M Property Studies Studies conducted in other countries shows that economic cycles and commercial property cycles exist, and that a relationship exit between the two cycles. Few research points to the cyclicality of both cycles to have an impact on property valuations. The aim of this study was therefore to establish whether the Namibian economy and the Windhoek commercial property market are cyclical, and if a relationship exist between the two. The study further aimed at establishing whether the cyclicality of both the economy and the commercial property market have an impact on the valuation of commercial properties in the Namibian context. The three research objectives allowed the research to identify the variables required to establish both economic and commercial property cycles, and the possible challenges faced by valuers using the income approach to value commercial properties during peaks and troughs of these cycles. The mixed-use approach was employed using a literature review to identify the variables required to establish both cycles followed by a secondary analysis. The research made use a questionnaire to gather data on challenges faced by valuers when valuing commercial properties during the different economic and commercial property markets environments. The research found that both economic and commercial property cycles do exist and that they are procyclical and countercyclical under certain variables. A countercyclical relationship exists between GDP and the commercial property vacancy rates. A countercyclical relationship exists between inflation and retail vacancy rates and office cap-rates. A procyclical relationship exist between interest rates and the retail vacancy rates and office cap-rates. The results revealed that during or near a peak of both economic and commercial property cycles, data is easily available and accessible making it easier to value commercial properties using the income approach. However, data shows that during or near economic and commercial property cycle troughs, market data is rare and unreliable making it difficult to value commercial properties. 2023-03-29T06:49:00Z 2023-03-29T06:49:00Z 2022 2023-03-15T07:27:40Z Master Thesis Masters MSc http://hdl.handle.net/11427/37536 eng application/pdf Department of Construction Economics and Management Faculty of Engineering and the Built Environment |
| spellingShingle | Property Studies Katjihingua, Else An investigation of the linkage between economic cycles and commercial property cycles, and their impact on the income approach of valuation: case of Windhoek |
| thesis_degree_str | Master's |
| title | An investigation of the linkage between economic cycles and commercial property cycles, and their impact on the income approach of valuation: case of Windhoek |
| title_full | An investigation of the linkage between economic cycles and commercial property cycles, and their impact on the income approach of valuation: case of Windhoek |
| title_fullStr | An investigation of the linkage between economic cycles and commercial property cycles, and their impact on the income approach of valuation: case of Windhoek |
| title_full_unstemmed | An investigation of the linkage between economic cycles and commercial property cycles, and their impact on the income approach of valuation: case of Windhoek |
| title_short | An investigation of the linkage between economic cycles and commercial property cycles, and their impact on the income approach of valuation: case of Windhoek |
| title_sort | investigation of the linkage between economic cycles and commercial property cycles and their impact on the income approach of valuation case of windhoek |
| topic | Property Studies |
| url | http://hdl.handle.net/11427/37536 |
| work_keys_str_mv | AT katjihinguaelse aninvestigationofthelinkagebetweeneconomiccyclesandcommercialpropertycyclesandtheirimpactontheincomeapproachofvaluationcaseofwindhoek AT katjihinguaelse investigationofthelinkagebetweeneconomiccyclesandcommercialpropertycyclesandtheirimpactontheincomeapproachofvaluationcaseofwindhoek |