Real Estate Economics: Margins and Pricing

This lecture covers the concept of the promoter's margin in real estate development, detailing the steps from land acquisition to building sale. It explains how the margin influences land pricing and construction costs, and discusses typical margin rates in Switzerland. Various interpretations of maximum land price, minimum building price, and maximum construction cost are presented, highlighting the promoter's decision-making process. The lecture concludes by emphasizing the need for promoters to optimize land, construction, and building prices to maximize profits.