Search results
1 – 10 of 159Rosli Said, Mardhiati Sulaimi, Rohayu Ab Majid, Ainoriza Mohd Aini, Olusegun Olaopin Olanrele and Omokolade Akinsomi
This study aims to address the critical need for innovative financing solutions in the global housing sector, focusing specifically on Malaysia’s distinct housing finance system…
Abstract
Purpose
This study aims to address the critical need for innovative financing solutions in the global housing sector, focusing specifically on Malaysia’s distinct housing finance system encompassing both conventional and Islamic loans. The primary objective is to develop a transformative housing finance model that addresses affordability challenges and reshapes the Malaysian housing landscape.
Design/methodology/approach
The study presents an alternate housing finance model for Malaysia, integrating lower monthly payments and reduced household debt. Key variables include house price appreciation rates, interest rates, initial guarantee fees and loan-to-value ratios. Inspired by the Help to Buy (HTB) scheme, the model aligns with proven global initiatives for enhanced affordability, balancing payment amounts, loan interest rates and acceptable price thresholds.
Findings
The study’s findings promise to address affordability disparities and reshape Malaysia’s housing finance landscape. The emphasis is on introducing a structured repayment plan that offers a sustainable path to homeownership, particularly for low-income families. Incorporating the future value adaptation concept, inspired by reverse mortgages and Islamic finance, enhances adaptability, ensuring long-term sustainability despite economic shifts.
Practical implications
The proposed model promotes widespread access to homeownership, offering practical solutions for policymakers to improve affordability, prompting adaptable risk management strategies for financial institutions and empowering potential homebuyers with increased flexibility.
Originality/value
The study introduces a transformative housing finance model for Malaysia, merging elements from reverse mortgages, Islamic finance and the HTB scheme, offering potential applicability to similar systems globally.
Details
Keywords
Srinivasa Reddy N and Jayanthi Thanigan
The purpose of this paper is to examine the antecedents of customer satisfaction during mortgage purchases. Mortgage demand in the USA has reached an all-time high because of an…
Abstract
Purpose
The purpose of this paper is to examine the antecedents of customer satisfaction during mortgage purchases. Mortgage demand in the USA has reached an all-time high because of an increase in housing demand after COVID-19. Nonetheless, several customers are dissatisfied with their service providers. Customers who actively search the market gain more information about mortgage providers and use this information to define expectations for lenders. The only way there will be customer satisfaction is if lenders meet these expectations. Therefore, it is economically significant for mortgage lenders to discover the antecedents of mortgage satisfaction.
Design/methodology/approach
In this study, the partial least squares approach was used to test the hypothesis that satisfaction was influenced by objective knowledge, familiarity and search intensity among a sample of customers (n = 4,512) from the National Survey of Mortgage Originations who had purchased a mortgage in the USA between 2019 and 2020.
Findings
The results of structural modelling showed that familiarity (β = 0.23 and p = 0.01) with and knowledge (β = 0.16 and p = 0.01) of mortgages significantly affected consumer satisfaction during mortgage purchase. Search intensity (p = 0.01) mediated the relationship between knowledge, familiarity and satisfaction.
Research limitations/implications
The primary implication is that mortgage service providers should prioritise educating customers about the mortgage buying process on their websites and in person. So managers must actively assist clients in having realistic expectations. Second, mortgage companies should establish a presence on third-party mortgage comparison websites to ensure that customers actively consider alternatives, thereby increasing customer satisfaction.
Originality/value
This study is unique in being an exploratory study to examine the antecedents of mortgage satisfaction using a public data set. This study uniquely examines the National Survey of Mortgage Originations data set with partial least squares approach to examine underlying customer attitudes.
Details
Keywords
Jean-Baptiste Coulomb, Fabrice Larceneux and Arnaud Simon
The authors analyzed annuitization preferences when retired people extract cash from their homes. Based on 2,608 viager (home reversion) transactions, the authors study the…
Abstract
Purpose
The authors analyzed annuitization preferences when retired people extract cash from their homes. Based on 2,608 viager (home reversion) transactions, the authors study the relations between annuitization, negotiation, cash extraction, age, gender and marital status.
Design/methodology/approach
A database comprising 2,608 transactions is used. The three-stage least squares (3SLS) and moderation models are implemented, with a focus on potential adverse selection issues.
Findings
The authors found that difficulties in selling a property generally result in increased annuitization. The single men's group endures gender inequality, suffering from limitations in their possibility to extract wealth and annuitize, as well as an additional price discount during negotiation. Young single men, as compared to young single women and young couples, must consent to a substantial price reduction if they prefer a high down payment and limited price reductions if they prefer annuities. Elderly single men, as compared to young single men, have less capacity to negotiate, a concern that is reinforced when they prefer annuities.
Originality/value
Among the home equity conversion products, the academic real estate literature has intensely analyzed the reverse mortgage. The viager is distinct from a mortgage in that it consists of the true sale of a property without bank involvement. This product deserves reinforced attention in an aging continental Europe. It exists in numerous countries (France, Belgium, Germany, Italy, Spain, etc.).
Details
Keywords
The Federal Reserve (Fed) has raised interest rates from zero in March 2022 to 5.25-5.5% and has reduced its bond holdings from nearly USD9tn to USD7.8tn. While the Inflation…
Details
DOI: 10.1108/OXAN-DB283712
ISSN: 2633-304X
Keywords
Geographic
Topical
Nicole F. Stowell, Carl Pacini, Martina K. Schmidt and Nathan Wadlinger
This study aims to increase awareness and educate the reader about health-care fraud targeting seniors in the USA to help stakeholders better understand, recognize and prevent…
Abstract
Purpose
This study aims to increase awareness and educate the reader about health-care fraud targeting seniors in the USA to help stakeholders better understand, recognize and prevent this type of fraud.
Design/methodology/approach
This paper collects statistics on the current state of health care frauds committed against seniors, and examines related cases and laws.
Findings
The authors find this type of fraud is highly prevalent and expected to increase. Current laws preventing this fraud from occurring are multifold and complex. While prevention strategies through law enforcement have been somewhat successful, a reduction in resources may put seniors at an increased risk in the years to come.
Research limitations/implications
Without additional prevention strategies, the problem will likely escalate with a growing population of older adults. This study encourages further research into effective prevention strategies and methods to fight health-care fraud against seniors.
Practical implications
Health-care fraud and its associated costs pose a significant threat to the society and economy of the USA. Reducing this fraud will not only reduce the costs to the US economy but also improve the physical and mental well-being of senior victims, reduce their mortality and hospitalization rates and improve the public trust placed to health-care providers.
Originality/value
This study highlights how health-care fraud is committed against seniors. With the projected trend of an aging US population, educating stakeholders, increasing awareness and applying tools to protect seniors will be important to reduce the absolute scope of this problem in the future.
Details
Keywords
This study deals with the main issues concerning the interplay between homeownership and labour market outcomes, namely (1) the relation between homeownership and labour market…
Abstract
Purpose
This study deals with the main issues concerning the interplay between homeownership and labour market outcomes, namely (1) the relation between homeownership and labour market outcomes, at both the individual level and the aggregate level, and (2) the relation between homeownership and human capital.
Design/methodology/approach
This paper is both theoretical and empirical. A search and matching model of the labour market is developed to explain the strong relation between mortgage markets and wages. A regional panel analysis in Italy is used to verify the interplay between homeownership and wages.
Findings
Homeownership is not, by itself, a condition for receiving higher wages, but rather higher wages increase the probability to become a homeowner, since they positively affect the probability of acquiring a mortgage from the bank. Eventually, wages cause homeownership, but the reverse may not be true.
Research limitations/implications
The paper focuses on the labour market, while the housing market model is restricted to the mortgage market.
Practical implications
The positive effect of homeownership on wages is hard to theoretically formalise and is not empirically proven. Before investigating a (potential) bidirectional relationship between homeownership and labour market outcomes, therefore, the related literature should assume a new theoretical link between homeowners and wages.
Social implications
The result that “homeownership is not, by itself, a condition for receiving higher wages” has positive implications for human and social development. If homeownership could lead to better labour market outcomes, indeed, socio-economic inequalities would increase in the society, because homeownership would be the starting point of a “lucky” circle that increases the well-being of people who are already wealthy.
Originality/value
First, this study clearly explains why the microeconomic result that homeowners are more likely to be employed than tenants is consistent – at the aggregate level – with a negative relation between homeownership and better labour market outcomes. Second, the related literature has largely ignored the social implications of the topic. A potential bidirectional relation between homeownership and (better) labour market outcomes, indeed, could imply an increase in the well-being of people who are already wealthy.
Details
Keywords
The main purpose of this study is to investigate the impact of housing price on mortgage debt accumulation while considering the structural break effects associated with the…
Abstract
Purpose
The main purpose of this study is to investigate the impact of housing price on mortgage debt accumulation while considering the structural break effects associated with the Global Financial Crisis (GFC).
Design/methodology/approach
To determine the existence of a long run relationship among the variables, this study used a Johansen cointegration test. The long run model was then estimated using the fully modified ordinary least square method and reported for both the model with and without a structural break associated with the GFC.
Findings
The findings demonstrate a moderate positive relationship between housing price and mortgage debt, with the impact of the GFC is positive but insignificant. The household’s lack of responsiveness to the GFC may be attributed to their optimistic expectations and confidence in the Malaysian housing market.
Practical implications
Findings of this study provide some guidance to policymakers and the banking sector in predicting household borrowing behavior during future economic crises.
Originality/value
The increase in housing prices and mortgage debt after the GFC has been a concern for many countries, including Malaysia. This study contributes to the literature by investigating the relationship between housing prices and mortgage debt in Malaysia and sheds light on the impact of the GFC on household borrowing behavior. The study’s contributions include providing new evidence to the underexplored topic, enhancing the robustness and reliability of the empirical results and providing insights into the importance of testing for structural breaks in time series analysis.
Details
Keywords
José Alberto Fuinhas, Nuno Silva and Joshua Duarte
This study aims to explain how delinquency shocks in one type of debt contaminate the others. That is, the authors aim to shed light on the time pattern of delinquencies in…
Abstract
Purpose
This study aims to explain how delinquency shocks in one type of debt contaminate the others. That is, the authors aim to shed light on the time pattern of delinquencies in different debt types.
Design/methodology/approach
This study analyzes the interdependencies between mortgage, credit card and auto loans delinquency rates in the USA from 2003 to 2019, using a panel VAR-X, the panel Granger causality tests and the Geweke linear dependence measures. The authors also compute the impulse response functions of a shock to one kind of debt on the others and decompose the variance of the forecast errors.
Findings
The authors find a statistically significant bidirectional Granger causality between the delinquencies. The Geweke measures of linear dependence and the Dumitrescu and Hurlin Granger non-causality tests support that mortgage predominantly causes credit card and auto loan delinquencies. Auto loans also cause credit card delinquencies. The impulse response functions confirm this pattern. This scenario aligns with a sequence where debtors consider rational first to default on credit cards, second on auto loans and only on mortgages in the last instance. Indeed, credit card delinquencies Granger-cause delinquencies in other debts when it occurs.
Originality/value
To the best of the authors’ knowledge, this is the first study to focus on the temporal pattern of delinquency rates for all the US states, using panel data. Furthermore, the results call for policymakers to design regulations to break the transmission channel from debt delinquencies.
Details
Keywords
Cengiz Tunc and Ali Gunes
This study aims to focus on two-way interaction between monetary policy and house prices in emerging economies.
Abstract
Purpose
This study aims to focus on two-way interaction between monetary policy and house prices in emerging economies.
Design/methodology/approach
This study uses panel structural vector autoregressive model.
Findings
The results show that real house prices decrease in response to a contractionary monetary policy shock. However, relative to advanced economies, the reaction of the prices is limited in emerging economies, pointing out the structural differences in emerging economies including the small size of the mortgage market and the lack of a well-functioning secondary market in housing finance. This study further finds that monetary policy is tightened in response to a positive shock to house prices. However, this response is also weak when compared to that response in advanced economies.
Research limitations/implications
These findings suggest that house price developments should not be prior target for monetary policies in emerging economies unless they become problem for financial stability or inflationary concerns.
Originality/value
Using a sample of inflation targeting emerging countries, this study contributes to the literature by conducting both panel setting and single-country analysis to explore the two-way dynamic relationships between the monetary policy and housing market in emerging economies.
Details