Analyzing Behavior of Agents in the Housing Sector for Formation of Equilibrium Pattern of Housing Prices in Iran

Investigating the behavior of agents in the housing sector, including investors, households and developers, is very important. A large part of housing price fluctuations is caused by the activities of these agent, especially the investors in this sector, and these housing price fluctuations influence other economic sectors because the housing sector has a lot of backward and forward relationships with other sectors. This research aims to analysis of the behavior of agent in the housing sector in the forming of the equilibrium pattern of housing prices in Iran using the mathematical optimization method for the period of 1991 to 2022. The results show that there is a positive relationship between the equilibrium price of housing with the construction cost of each residential unit, household income and investors' expectations of housing prices. Also, there is a direct relationship between the volume of trading of investors and their expectations of housing prices. When the expectations of housing prices are in the range of zero to 1.71 and more than 1.71, investors will be in the position of selling and buying housing, respectively. Hence, the relationship between the equilibrium price of housing and the volume of trading of investors with the risk component of investors is positive, and if the equilibrium price of housing is more (less than) 2.33, investors take a selling (buying) position. On the other hand, if the investors are in the low range of zero according to the amount of risk and volume of trading of investors, then the investors are in the selling position and if they are in the upper range of zero, the investors are in the buying position.