Urban Big Data and Real Estate Markets – The Property Chronicle
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Urban Big Data and Real Estate Markets Analysing real estate through big data

The Economist

Most real estate value is created at the urban level, but some of the most expensive cities in the world are the least well-functioning.  So, it does not follow that improvements in the ways cities are run will flow directly into increased real estate value, but they might.

Big data techniques are increasingly being adopted by city governments to improve the urban environment and reduce the cost of doing so.  The initial results are very encouraging from an urban perspective.  Whether big data mean big gains for real estate owners is less clear.

Big data has three dimensions:  Volume, Velocity and Variety.

Volume: big data is large—often measured in petabytes or more.

Velocity: big data is frequently generated continuously, in or near real time. Twitter posts, cell phone location data, and information from weather and air quality sensors are examples.

Variety: big data comprises numbers, text, images, video, audio and other kinds of data. Analysis needs to be flexible enough to deal with any mix of types.

According to Glaeser, Kolko and Saiz rents in any location are a direct function of wages, jobs and amenities. Where big data can generate productivity or amenity gains in cities there will be a proportionate rise in real estate values.

Productivity Premium + Amenity Premium = Rent Premium

Urban big data is comparatively new, so the scope of initiatives pursued in different parts of the world varies widely. Below are some examples.

City Examples

Impact on City & Real Estate Values

NEW YORK CITY, NY, USA:

The Health and Human Services Connect initiative allows clients to walk into different agencies without duplicating paperwork. It allows the city to save costs, provide better services and even fraud.






The Economist

About Richard Barkham

Richard Barkham

Richard is a specialist in macro and real estate economics. He joined CBRE in 2014 as Executive Director and Global Chief Economist. Prior to taking up his position with CBRE Richard was a Director of Research for the Grosvenor Group an international business with circa $10bn of capital under management in real estate. He was also a non-Executive Director of Grosvenor Fund Management where he was involved in fund strategy, risk analysis and capital raising. Richard is the author of two books and numerous academic and industry papers. In 2012 he published Real Estate and Globalisation (Wiley Blackwell, Oxford), which explains the impact on real estate markets of the rise of emerging markets such as China and Brazil. He has extensive consulting experience and is a Visiting Professor in the Department of Construction and Project Management at the Bartlett School, University College London. He holds a PhD in economics from the University of Reading where he taught, in the Departments of Economics and Land Management, between the years of 1987 and 1998.​​​

Articles by Richard Barkham

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