Icing on the Cake: Can the Top-Floor Units Serve as a Status Good and an Investment Simultaneously?

Edward Chi Ho Tang; Charles Ka Yui Leung

doi:10.1007/s11146-024-10004-5

Icing on the Cake: Can the Top-Floor Units Serve as a Status Good and an Investment Simultaneously?

Edward Chi Ho Tang, Charles Ka Yui Leung^*

^*Corresponding author for this work

Department of Economics and Finance

Research output: Journal Publications and Reviews › RGC 21 - Publication in refereed journal › peer-review

Abstract

Situated atop condominium buildings, ‘top floor units’ (TFU) offer unparalleled views and privacy, courtesy of accessible roofs. This paper empirically examines this status symbol and finds that: (1) TFUs interact with the macroeconomy differently from ordinary units, (2) when considering the liquidity factor, TFUs should not be included in the portfolio, (3) the trade-off between holding period and annualized return for TFUs significantly differs from ordinary units, suggesting alternative investment strategies are employed for TFUs, and (4) the liquidity of the TFU segment is less stable than ordinary units, potentially deterring short-term speculators. © The Author(s), under exclusive licence to Springer Science+Business Media, LLC, part of Springer Nature 2025.

Original language	English
Journal	The Journal of Real Estate Finance and Economics
Online published	19 Jan 2025
DOIs	https://doi.org/10.1007/s11146-024-10004-5
Publication status	Online published - 19 Jan 2025

Funding

The work described in this paper is supported by the Research Grants Council of the Hong Kong Special Administrative Region, China (Project No.: UGC/FDS15/B01/18). The usual disclaimer applies.

Research Keywords

Markov switching model
Peer group effect on consumption
Speculation
Submarkets
Top floor units

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title = "Icing on the Cake: Can the Top-Floor Units Serve as a Status Good and an Investment Simultaneously?",

abstract = "Situated atop condominium buildings, {\textquoteleft}top floor units{\textquoteright} (TFU) offer unparalleled views and privacy, courtesy of accessible roofs. This paper empirically examines this status symbol and finds that: (1) TFUs interact with the macroeconomy differently from ordinary units, (2) when considering the liquidity factor, TFUs should not be included in the portfolio, (3) the trade-off between holding period and annualized return for TFUs significantly differs from ordinary units, suggesting alternative investment strategies are employed for TFUs, and (4) the liquidity of the TFU segment is less stable than ordinary units, potentially deterring short-term speculators. {\textcopyright} The Author(s), under exclusive licence to Springer Science+Business Media, LLC, part of Springer Nature 2025.",

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author = "Tang, {Edward Chi Ho} and Leung, {Charles Ka Yui}",

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doi = "10.1007/s11146-024-10004-5",

language = "English",

journal = "The Journal of Real Estate Finance and Economics",

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AU - Leung, Charles Ka Yui

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N2 - Situated atop condominium buildings, ‘top floor units’ (TFU) offer unparalleled views and privacy, courtesy of accessible roofs. This paper empirically examines this status symbol and finds that: (1) TFUs interact with the macroeconomy differently from ordinary units, (2) when considering the liquidity factor, TFUs should not be included in the portfolio, (3) the trade-off between holding period and annualized return for TFUs significantly differs from ordinary units, suggesting alternative investment strategies are employed for TFUs, and (4) the liquidity of the TFU segment is less stable than ordinary units, potentially deterring short-term speculators. © The Author(s), under exclusive licence to Springer Science+Business Media, LLC, part of Springer Nature 2025.

AB - Situated atop condominium buildings, ‘top floor units’ (TFU) offer unparalleled views and privacy, courtesy of accessible roofs. This paper empirically examines this status symbol and finds that: (1) TFUs interact with the macroeconomy differently from ordinary units, (2) when considering the liquidity factor, TFUs should not be included in the portfolio, (3) the trade-off between holding period and annualized return for TFUs significantly differs from ordinary units, suggesting alternative investment strategies are employed for TFUs, and (4) the liquidity of the TFU segment is less stable than ordinary units, potentially deterring short-term speculators. © The Author(s), under exclusive licence to Springer Science+Business Media, LLC, part of Springer Nature 2025.

KW - Markov switching model

KW - Peer group effect on consumption

KW - Speculation

KW - Submarkets

KW - Top floor units

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U2 - 10.1007/s11146-024-10004-5

DO - 10.1007/s11146-024-10004-5

M3 - RGC 21 - Publication in refereed journal

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JO - The Journal of Real Estate Finance and Economics

JF - The Journal of Real Estate Finance and Economics

ER -

Icing on the Cake: Can the Top-Floor Units Serve as a Status Good and an Investment Simultaneously?

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