Real Estate Economics and Finance

  • Summer schools
  • Department of Geography and Environment
  • Application code SS-EC203
  • Starting 2022
  • Short course: Open
  • Location: Houghton Street, London

This course is an introduction to the theoretical and practical functioning of urban real estate markets using concepts from urban economics, finance and real estate economics.

In the first half of the course, we will cover the productive and consumption advantages of urban areas and location patterns within cities. We will see how these help determine demand for residential and commercial real estate, as well as looking at differences in supply for different types of properties. We will also discuss the impact of policy, with a special focus on taxation and urban planning.

Equipped with this framework, the second half of the course will explore how demand and supply for space determine real estate asset prices and how to measure them. We will then discuss how those measures can be used to value commercial real estate, as well as other techniques for valuation, focusing on cash-flow analysis. From there, we will explore how those valuations, financial leverage, and portfolio considerations are used to make real estate investment decisions. Finally, we will investigate the drivers of real estate cycles and emerging market trends to study their implications for investment outcomes. 

A major component of the course is the case study in which students value a mixed-use commercial real estate property using the knoweldge and techniques they have learned.

This course will be particularly relevant for students interested in employment in real estate related fields in the public or private sector; or for students who are considering further education in this field.

Session: One - CLOSED
Dates: 20 June - 8 July 2022
Lecturers: Dr Lindsay Relihan and Dr Felipe Carozzi


Programme details

Key facts

Level: 200 level. Read more information on levels in our FAQs

Fees:  Please see Fees and payments

Lectures: 36 hours 

Classes: 18 hours

Assessment*: One case study (25%) and one written examination (75%)

Typical credit**: 3-4 credits (US) 7.5 ECTS points (EU)

*Assessment is optional

**You will need to check with your home institution

For more information on exams and credit, read Teaching and assessment


Introductory microeconomics and introductory statistics

Programme structure

Block 1

  • Course introduction. Real Estate values over space and time
  • Why do cities exist? Agglomeration economies and urban consumption
  • Monocentric City Model and spatial equilibrium
  • City Systems, city size and prices
  • Real estate supply
  • Public policy and real estate

Block 2

  • Real estate price measurement: median price, hedonic regression, repeat sales
  • Valuation and risk-assessment of income-producing properties
  • Financial leverage
  • Real estate investment trusts
  • Optimal portfolio theory
  • Dynamics of the last housing boom and bust
  • Emerging market forces in commercial real estate: Brexit, online retail, climate change.

Course outcomes

  • Discuss the determinants of locations decisions of households and firms within and across cities
  • Use the urban economic models to predict how urban structure and real estate prices may be affected by changes in the city
  • Recognize urban areas differ with regards to their supply constraints, and understand how these constraints are shaped by human and natural factors
  • Predict the effect of different microeconomic policies on Real Estate prices based on theoretical and empirical evidence
  • Explain the differences between different valuation measures in residential and commercial real estate
  • Analyse the impact of financial leverage and portfolio considerations on an investment decision
  • Draw on theory to assess the impact of a shift in supply and demand on residential and commercial property markets.


LSE Geography and Environment excels in the UK's nationwide assessment of research quality, impact and environment and in subject-based worldwide university ranking systems. The Research Excellence Framework results published in December 2014 show that LSE Geography and Environment ranked first overall in the UK for quality of published research output. 

The 2018 QS World University faculty rankings for Geography and Area Studies ranked the department No.2 in the world on the overall score, and No.1 for academic reputation. The Guardian’s university league tables 2016 also ranked the LSE No.1 for Geography and Environmental Studies.

On this three week intensive programme, you will engage with and learn from full-time lecturers from the LSE’s Geography and Environment faculty. 

Reading materials

Archer, Wayne R., and David C. Ling, "The three dimensions of real estate markets: Linking space, capital, and property markets", Real Estate Finance 14.3 (1997): 5-11.

Brueggeman, W. B. and J. D. Fisher (2005), Real Estate Finance & Investments, (13th edition or newer), New York City, NY: McGraw-Hill/Irwin.

Gunnelin, Åke, et al., "Determinants of cross‐sectional variation in discount rates, growth rates and exit cap rates", Real Estate Economics 32.2 (2004): 217-237.

O'Sullivan, Arthur (2007), Urban Economics, McGraw-Hill/Irwin.

McDonald, J. F. & D. P. McMillen (2011), Urban Economics and Real Estate, Theory and Policy, (2nd edition), Blackwell.

*A more detailed reading list will be supplied prior to the start of the programme

**Course content, faculty and dates may be subject to change without prior notice

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