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Article
Publication date: 21 October 2020

Hassanudin Mohd Thas Thaker, Mohamed Ariff and Niviethan Rao Subramaniam

The purpose of this paper is to identify the drivers of residential price as well as the degree co-movement of housing among different states in Malaysia.

1104

Abstract

Purpose

The purpose of this paper is to identify the drivers of residential price as well as the degree co-movement of housing among different states in Malaysia.

Design/methodology/approach

This study adopted an advanced econometrics technique: the dynamic autoregressive-distributed lag (DARDL) and – the time-frequency domain approach known as the wavelet coherence test. The DARDL model was applied to identify the cointegrating relationships and the CWT was used to analyze the co-movement and lead–lag relationships among four states’ regional housing prices. The extracted data were mainly on annual basis and comprised macroeconomics and financial factors. Information with regard to residential prices and other variables was extracted from the National Property Information Centre (NAPIC) website, the Central Bank of Malaysia Statistics Report, the Department of Statistics, Malaysia, I-Property.com and the World Bank (WB). The data covered in this study were the pool data from four main states in Malaysia and different categories of residential properties.

Findings

The empirical results indicate that there were long-run cointegration relationships between the housing price and capital gain and loss, rental per square feet, disposable income, inflation, number of marriages, deposit rate, risk premium and loan-to-value (LTV) ratio. While the wavelet analysis shows that (1) in the long run, Kuala Lumpur housing price having strong co-movement with Selangor, Penang and Melaka housing prices except for Johor and (2) the lead–lag relationship also postulates Kuala Lumpur housing price having in-phase category with Selangor, Penang and Melaka housing prices except for Johor.

Practical implications

This study offers relevant practical implications. First, the study proposes an active collaboration between the private sector and government support which may help to smooth the pricing issue of residential properties. More low-cost residential projects are needed for focus groups including middle- and low-income earners. Furthermore, the results are expected to provide real estate investor in Malaysia, an improved understanding of the regional housing market price dynamics.

Originality/value

The findings of this study were obtained from various reliable sources; therefore, the results reflected the analysis of price drivers and co-movements. Furthermore, findings from this study lend some support to the argument on the rise of residential prices and offer several policy implications from a practical point of view with regard to the residential market.

Details

Property Management, vol. 39 no. 1
Type: Research Article
ISSN: 0263-7472

Keywords

Article
Publication date: 26 May 2020

Hassanudin Mohd Thas Thaker and Mohamed Ariff

This study aims to explore the issue of residential price in Malaysia from a supply-side perspective. The views are directly obtained from medium and small-scale…

Abstract

Purpose

This study aims to explore the issue of residential price in Malaysia from a supply-side perspective. The views are directly obtained from medium and small-scale developers in Malaysia.

Design/methodology/approach

We used the semi-structured interview for analysis purpose. The samples are from property developers (medium and small-scale developers) and a single respondent from the Malaysian National House Buyers Association. We used the judgmental sampling method to choose respondents for this study. The interview results went through content analysis in order to derive common themes, resulting in the identification of four main themes.

Findings

First, developers view that the residential market is growing at a good pace, albeit slowly. However, the issue of unaffordability and construction costs remains to haunt the progress of property development in Malaysia. Second, from supply-side perspectives, there are several main reasons why the residential prices in Malaysia are uncontrollable: (1) costs of construction, (2) taxes, (3) existing units, (4) location and (5) urbanization. The third theme is the government support in catering to the needs and wants of middle- and lower-income earners. Most respondents agreed that the government has been providing low-cost houses supported by various incentives. Finally, on price control strategies for residential units, recommended suggestions are as follow: embracing different methods of construction styles, promote the uses of local materials instead of relying on imported materials, continuously review rules and regulations, provide more incentives and to build partnerships between the government and private companies on affordable housing projects.

Practical implications

The research is expected to present solid findings and claimsseveral significant contributions, especially policy-wise. We believe this contribution will enrich the existing literature on residential market. The present study is also predicted to produce noteworthy findings to all stakeholders in the real-estate industry, such as potential home buyers and existing house owners to housing developers, marketers and government policy regulators, as well as academic institutions.

Originality/value

This study is expected to enrich the existing literature available in the context of real-estate finance such as property price and property policy in emerging economies like Malaysia. One distinguishing factor which differentiates this study from others in the literature is the feedbacks obtained from medium and small-scale developers, therefore deemed to be more solid and reliable. The current research in real-estate finance is mainly focused on empirical analysis and we believe this study will offer a breakthrough view on the matter of residential market in Malaysia.

Details

Property Management, vol. 38 no. 4
Type: Research Article
ISSN: 0263-7472

Keywords

Article
Publication date: 7 November 2016

Iustina Alina Boitan

The purpose of this study is to contribute to the relatively narrow existing residential real estate literature by developing and validating several univariate forecasting…

Abstract

Purpose

The purpose of this study is to contribute to the relatively narrow existing residential real estate literature by developing and validating several univariate forecasting models, to reliably anticipate future house price dynamics across several European Union (EU) countries.

Design/methodology/approach

The research approach relies on the time series analysis, by using the Box–Jenkins autoregressive integrated moving average (ARIMA) methodology to explore the trends of residential property prices in selected EU countries and to obtain a snapshot of the potential signs of change to be witnessed by domestic residential markets on a short time-period. The analysis has been performed distinctly for each country in the sample, to account for country-specific past and future trends as well as similarities in their house price growth rate evolutions. The models were estimated for a broad sample of quarterly observations during 1990-2015, while the forecast horizon ranged between the third quarter of 2015 and the fourth quarter of 2016.

Findings

The findings suggested that residential property prices’ real growth rate can be modeled through the Box–Jenkins method for France, The Netherlands, Sweden and UK. The pattern of Italy’s residential property prices’ real growth rate cannot be explained by means of univariate ARIMA models, being more suited for multivariate models.

Originality/value

The article subscribes to the need for timely, high-frequency and quality data about house price trends in Europe, to increase the accuracy of forecasts and prevent the appearance of bubbles on real estate market. It compares residential property prices’ dynamics across European countries to identify housing markets with similar patterns of their prices.

Details

Journal of European Real Estate Research, vol. 9 no. 3
Type: Research Article
ISSN: 1753-9269

Keywords

Article
Publication date: 25 January 2021

Le Ma, Henry Liu and Michael Sing

This study aims to address the gap by empirically exploring how residential construction-production progress, which includes project commencement, under-construction and…

Abstract

Purpose

This study aims to address the gap by empirically exploring how residential construction-production progress, which includes project commencement, under-construction and project completion, responds dynamically to fluctuations in house prices.

Design/methodology/approach

A vector autoregressive model and an impulse response function are applied to simulate and analyse the circle of the stage-responsiveness of residential construction to residential property price dynamics in the state of Victoria, Australia. The quarterly numbers of dwelling units commenced, under-construction and completed are used as the proxy for the residential construction activities at three stages over the construction progress.

Findings

The analysis indicates that the dynamics are essentially transmitted throughout the construction process and can substantially impact the pace of production progress. The findings from this study provide an empirical base that should be useful in developing price-elasticity and production theories applicable to the context of residential property construction.

Research limitations/implications

The findings described above have been generated basically by examining the case of Victoria, Australia at a macro level. The generalisation of the research output needs to be verified further by future researchers using data collected from other regions/countries. Nevertheless, the reliability of the conclusions with particular practical implications can be substantially improved by future researchers by analysing more markets and production proxies at the activity level.

Practical implications

Based on new empirical findings, this research argues that building activity (i.e. under construction) played as a gateway between the construction and housing sectors, via which the inter-responsiveness of the housing supply in terms of construction activities and housing prices are transmitted.

Originality/value

This research firstly attempts to explore the inter-responsiveness between the real estate and construction sectors. A simulated circle of the stage-responsiveness of residential construction to residential property price dynamics is proposed, which can serve as a significant foundation for developing the theory of construction production.

Details

International Journal of Housing Markets and Analysis, vol. 14 no. 4
Type: Research Article
ISSN: 1753-8270

Keywords

Article
Publication date: 1 September 2000

Index by subjects, compiled by K.G.B. Bakewell covering the following journals: Facilities Volumes 8‐17; Journal of Property Investment & Finance Volumes 8‐17; Property…

26781

Abstract

Index by subjects, compiled by K.G.B. Bakewell covering the following journals: Facilities Volumes 8‐17; Journal of Property Investment & Finance Volumes 8‐17; Property Management Volumes 8‐17; Structural Survey Volumes 8‐17.

Details

Facilities, vol. 18 no. 9
Type: Research Article
ISSN: 0263-2772

Article
Publication date: 1 March 2001

K.G.B. Bakewell

Compiled by K.G.B. Bakewell covering the following journals published by MCB University Press: Facilities Volumes 8‐18; Journal of Property Investment & Finance Volumes…

16992

Abstract

Compiled by K.G.B. Bakewell covering the following journals published by MCB University Press: Facilities Volumes 8‐18; Journal of Property Investment & Finance Volumes 8‐18; Property Management Volumes 8‐18; Structural Survey Volumes 8‐18.

Details

Structural Survey, vol. 19 no. 3
Type: Research Article
ISSN: 0263-080X

Article
Publication date: 1 March 2000

K.G.B. Bakewell

Compiled by K.G.B. Bakewell covering the following journals published by MCB University Press: Facilities Volumes 8‐17; Journal of Property Investment & Finance Volumes…

23405

Abstract

Compiled by K.G.B. Bakewell covering the following journals published by MCB University Press: Facilities Volumes 8‐17; Journal of Property Investment & Finance Volumes 8‐17; Property Management Volumes 8‐17; Structural Survey Volumes 8‐17.

Details

Property Management, vol. 18 no. 3
Type: Research Article
ISSN: 0263-7472

Article
Publication date: 1 September 2001

Index by subjects, compiled by K.G.B. Bakewell covering the following journals: Facilities Volumes 8‐18; Journal of Property Investment & Finance Volumes 8‐18; Property…

14392

Abstract

Index by subjects, compiled by K.G.B. Bakewell covering the following journals: Facilities Volumes 8‐18; Journal of Property Investment & Finance Volumes 8‐18; Property Management Volumes 8‐18; Structural Survey Volumes 8‐18.

Details

Facilities, vol. 19 no. 9
Type: Research Article
ISSN: 0263-2772

Article
Publication date: 19 February 2018

Le Ma, Richard Reed and Xiaohua Jin

Due to the complicated nature of houses, the driving factors of the residential construction output can be investigated from different perspectives of interests. However…

Abstract

Purpose

Due to the complicated nature of houses, the driving factors of the residential construction output can be investigated from different perspectives of interests. However, little research has provided an insight of the trend of the residential construction output from a cross-disciplinary perspective. The purpose of this paper is to identify the long-run equilibrium types of residential construction output, including external equilibrium, solo-market equilibrium and dual-market equilibrium.

Design/methodology/approach

A vector error correction model is applied into longitudinal data in the eight Australian states and territories to overview the regional variations of the residential construction output.

Findings

The empirical results show that the equilibrium of regional residential construction outputs in New South Wales and Victoria are determined by the external factors; the equilibrium in Western Australia is dominated by the construction market; and the equilibriums in the other five states and territories are influenced by both construction and house markets.

Research limitations/implications

The simplified approach may overlook the detailed explanation of the external factors, such as regional population, economy, policy and so forth. Given this limitation, future studies can introduce the correspondingly variables as per research interests.

Originality/value

Implementing the existing research into residential construction output and house supply, this research provides a simplified approach that demonstrates the linkage between construction and real estate sectors to identify the long-run equilibriums across regions. The underlying research sheds light in delivering inter-disciplinary research into the residential construction output.

Details

Engineering, Construction and Architectural Management, vol. 25 no. 1
Type: Research Article
ISSN: 0969-9988

Keywords

Article
Publication date: 1 March 2001

K.G.B. Bakewell

Compiled by K.G.B. Bakewell covering the following journals published by MCB University Press: Facilities Volumes 8‐18; Journal of Property Investment & Finance Volumes…

13871

Abstract

Compiled by K.G.B. Bakewell covering the following journals published by MCB University Press: Facilities Volumes 8‐18; Journal of Property Investment & Finance Volumes 8‐18; Property Management Volumes 8‐18; Structural Survey Volumes 8‐18.

Details

Property Management, vol. 19 no. 3
Type: Research Article
ISSN: 0263-7472

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