The phenomenon of vacant houses in Iran, Europe and the United States
An economic expert: The rate of vacant houses in Tehran is about twelve percent, the average in the United States and European countries is almost the same and even higher, about eighteen percent.
According to the International Exhibition of Iranian Stone, Hamed Qudusi, an economist, wrote in a note on social media about the phenomenon of empty houses, which you think is:
Let's start with the question: Why do we always have a series of empty taxis in the community, a series of single people, a series of unemployed people, a series of works of art sold in galleries, a series of start-up companies that are not funded and of course we have a number of vacant houses?
All of these observations go under the question of "search" in economics (with all sorts of variations). What does search mean? That is, in the case of products that are not commodity and standard (such as milk or Tehran-Mashhad tickets), people with different tastes need time to test different products and decide somewhere that is enough. For example, someone who is looking for a partner does not necessarily stop at seeing the first person "suitable" because he thinks that maybe if he goes for a while longer, he will find a "more suitable" person. The person who sells the painting doesn't necessarily say yes to the first buyer because he thinks he might get a better price if he waits; Well, here's a trade-off: the more we wait, the more we lose the Match-like utility during the delay. For example, someone who does not accept the first job offer is deprived of the right to find the next job. Instead, we increase our chances of finding a better mate for a longer period of time. The same trade-off tells us where the balance of empty inventory in any market comes from.
Well, now in the housing market: both the seller and the buyer (ownership or rent) are motivated to wait or look for a while. "So in balance there will always be a number of empty houses": the seller has offered but the optimal pair has not yet happened for the parties. But what if the seller sees that no one has been found after a long wait (the so-called booming market)? It lowers the price so that someone is finally satisfied with the purchase. On the other hand, what would the buyer do if he did not find the right home after a while? He is satisfied with one thing but continues to explore the potential, and at the first opportunity he finds a better home, he empties the previous one. (If he is the owner, he buys a new house and puts the previous one up for sale.) Now, within this framework, what determines how many empty houses there will be in the long run?
This number is called the natural or structural rate of vacant homes in the economy (similar to the natural unemployment rate). Well, an obvious factor in determining the price of vacant homes is "price growth." If the seller sees that the price is growing at a good rate over time, the "cost" I endure from the delay and non-sale / rent of the house will be less because the potential growth of the price will compensate for the lost Dividend (eg rent or interest).
As a result, in markets with rising prices, the average number of vacant homes increases. Another factor is fluctuations in society and the economy. In a small town with a quiet and predictable economy, the vacant house will be low because the "shock" to the lives of the households is small and the motivation to move is not high. In contrast, in economies with high volatility (opportunities / threats), the vacancy rate rises because people move at a higher rate (both physically and economically). The third factor is "cost and search technology." In a classic European city where buildings are crowded, architecture is similar, and the quality of neighborhoods is close to each other, the empty house will be small because searching for more is of little use and more or less similar to the buyer's first home. In contrast, in Tehran or many American cities, the benefits of searching are high because homes and neighborhoods are very different, and a lot of searching is needed to find the right home. In these cities, houses remain vacant for a long time. Search technology is also important: If the buyer / seller can see all the options in one go, there is no need to procrastinate. The idea of a "sales day" is probably this: we're announcing a special day for all potential buyers.
Conclusion: An empty house is a natural phenomenon in the economy and is seen everywhere and has a definite function. It may be interesting to take a look at real-world numbers: the rate of vacant homes in Tehran is around 12 percent, with the average in the United States and European countries being "more or less" the same and even higher (about 18 percent) (at times, of course). Like the financial crisis, the rate goes up and sometimes less.
