Young adults’ default intention: influence of behavioral factors in determining housing and real estate loan repayment in India
International Journal of Housing Markets and Analysis
ISSN: 1753-8270
Article publication date: 12 April 2022
Issue publication date: 28 February 2023
Abstract
Purpose
The primary purpose of this paper is to determine the role of behavioral characteristics of young adults on housing and real estate loan default intentions. The behavioral factors considered in this study are financial literacy, materialism, emotions, indebtedness and risk perception.
Design/methodology/approach
The sample frame comprises of young clients who have taken house loans and work in India’s metropolitan cities. These cities provide a higher quality of life, more employment possibilities and cheaper living costs. A systematic questionnaire was used, which was divided into six components. A total of 352 valid responses were collected and analyzed through a structural equation model.
Findings
The findings suggest that financial literacy, materialism and risk perception have a considerable impact on loan default intention among young adults. The results also ascertained that emotion and indebtedness do not have a considerable impact on loan default intention among young adults.
Research limitations/implications
The scope of this study is limited to India’s metropolitan cities. Future studies can examine comparative examinations of young adults working in the public and private sectors and those working in different cities across India.
Practical implications
This paper contributes to a better understanding of behavioral variables which may lead to the creation of preventive measures for young defaulters. The findings of this study will help financial institutions to improve their credit-offering models.
Originality/value
To the best of the authors’ knowledge, this study is the first to determine the role of behavioral attributes of young adults on housing and real estate loan default intentions in India. This work will be executable to all the stakeholders of the housing and real estate industry altogether.
Keywords
Acknowledgements
The authors would like to confirm that this research received no specific grant from any funding agency in the public, commercial, or not-for-profit sectors.
Citation
Thomas, S.S., George, J.P., Godwin, B.J. and Siby, A. (2023), "Young adults’ default intention: influence of behavioral factors in determining housing and real estate loan repayment in India", International Journal of Housing Markets and Analysis, Vol. 16 No. 2, pp. 426-444. https://doi.org/10.1108/IJHMA-01-2022-0012
Publisher
:Emerald Publishing Limited
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