Examining surplus and shortage in occupied housing preference in Malaysia

Abstract

Purpose

Housing sufficiency is a critical indicator of national development and growth. However, in most countries, housing affordability remains a significant challenge, leading to a mismatch between housing supply and demand. The purpose of this study is to investigate the housing preferences, current occupation and the resulting surplus and shortage across various housing types.

Design/methodology/approach

Data were collected through a survey, and the analysis focused on quantifying the mismatch between preferred and occupied housing types.

Findings

Results revealed significant disparities between housing preferences and current occupation, with some housing types experiencing surplus and others facing shortages. The findings uncovered a 23% discrepancy in housing demand and supply. The sensitivity results indicate that 30% of the respondents currently living in a particular type of housing unit would choose to live there if given the option. The specificity results show that 90% of respondents not living in a particular type of housing unit would continue to avoid choosing it. Housing price, income, ethnicity, race and location are the major drivers of the housing preferences.

Practical implications

Developers can align their projects with consumer preferences to minimize surplus and shortages. Financial institutions may consider these insights when tailoring mortgage products to meet the diverse needs of potential homebuyers. This research provides a valuable foundation for strategic planning and policy formulation aimed at enhancing housing sufficiency and socioeconomic development in Malaysia.

Originality/value

This study lays the foundation for future research and for incentive mechanisms for homebuyers and developers. The results are useful to policymakers, developers, banks, consultants, housing associations and academics.

Citation

Olanrewaju, A., Chai, K.S., Sanmargaraja, S., Nizamani, Z. and Khor, S.C. (2024), "Examining surplus and shortage in occupied housing preference in Malaysia", International Journal of Housing Markets and Analysis, Vol. ahead-of-print No. ahead-of-print. https://doi.org/10.1108/IJHMA-08-2024-0126