Home Financing Research Articles

“Accept it or not?”: young people’s struggles with parental financing for property-purchase in Hong Kong

When skyrocketing house prices worsen housing affordability, parental financial support is suggested to be more important and prevalent in young people’s housing transition. However, little is known about young people’s perceptions and responses to it, particularly when they struggle among different sets of conflicting norms – the values of self-reliance, deep-seated home ownership preference, and marriage and gender expectations. Based on in-depth interviews with 50 highly educated young people aged 25–34 in Hong Kong, this study found that many young people were torn between the housing ideal – achieving home ownership by themselves – and economic realities. They did not necessarily welcome their parents’ home financing while many struggled to establish their financial responsibility even when they agreed to accept parents’ money. Some explicitly rejected parents’ assistance due to different concerns, such as preserving decision-making power. Gender and marriage norms also shape parents-of-daughters’ financing and young men’s acceptance. Young people’s attempts to carefully delineate financing responsibility in own housing projects (e.g. an outright rejection of parents’ money) may impede parents’ accumulating reciprocal support resources and shape intergenerational relationships in the long term.

Consumers’ acceptance intention towards interest-free home financing: decomposition approach of TPB model

Purpose This paper aims to determine factors that contribute to consumers’ intention to opt for interest-free home financing or mortgage adapting decomposition approach of the theory of planned behaviour (TPB) model. Design/methodology/approach For this study, judgemental and purposive sampling was used and over 300 respondents who are using or willing to use equity-based Islamic mortgages were selected for analysis. Findings According to the findings of this study, consumers’ intention towards the interest-free mortgage is influenced primarily by their attitude, subjective norm and perceived behavioural control but also by the additional construct of their innovativeness of consumers as well as decomposed variables such as perceived relative advantage and perceived compatibility, but most importantly, peers. Overall, the study’s findings show that the suggested model clarifies a better knowledge of the factors that influence consumers’ choices to accept interest-free mortgage financing. Research limitations/implications Considering this research to be limited in terms of coverage geographically and the theory rendered the context should be given proper attention when interpreting future outcomes. Furthermore, future researchers can extend the direct relationship by using attitude as a mediator and also test adding a moderating variable when conducting a cross-sectional study. Originality/value This work is mainly focused on consumers’ intention to use Islamic mortgages. Current research incorporates and validates consumer innovativeness and introduces decomposed variables, namely, peers, perceived relative advantage and perceived compatibility to the TPB model. To the best of the authors’ knowledge, the decomposition of variables with the main predictors in the setting of an interest-free mortgage in Pakistan, the decomposition approach of the TPB model has not yet been attempted.

Historical Studies: The Social Life Of Muslim Minorities In The United States

This article describes the history of Islamic civilization in the Muslim minority country of America. The United States is secular but provides opportunities for every religion to grow and develop. The development of Islam in America cannot be separated from the scholars there. The method used in this paper is the Library research method (literature study). The results of this study noted that Islam is very developed in America compared to other religions when many Americans embrace Islam. Several Islamic financial and banking institutions were established in America Finance House Riba in California, which offers home financing based on Sharia principles. In addition, the emergence of Islamic economics and finance in this country was not as smooth as in other countries. Muslim minorities have established large organizations to help each other, such as ISNA, CAIR, and Islamic Relief USA.

Homeownership through asnaf home financing in Malaysia: an empirical investigation

Purpose The purpose of this study is to examine asnafs’ acceptance of home financing in Malaysia. Design/methodology/approach This work developed and introduced the maqasid theory of consumer behaviour (MTCB) to examine the effects of educational programmes, mortgage welfare, consumer justice and Islamic debt policy on receptiveness. Data analysis involving 733 respondents was conducted using partial least squares (PLS), where SmartPLS4.0 software comes into play. Findings In the core model, the effects of the MTCB’s variables helped shape the development of asnaf home financing acceptance. Research limitations/implications This study was based on quantitative data and geographical constraints. Practical implications The findings provide valuable inputs for the Joint Committee Body (JCB), combining Islamic banks and State Islamic Religious Councils to develop action plans for improving the facility offered. Social implications This work functioned as a social benchmark for improving Islamic home financing that includes asnafs’ homeownership. Originality/value A new conceptual framework for asnaf home financing drawn from MTCB is developed in the context of asnafs’ homeownership.

A STUDY ON COMPARING BORROWER EASE WITH STATE BANK OF INDIA (SBI) AND LIFE INSURANCE CORPORATION (LIC) HOUSING FINANCE IN KRISHNAGIRI DISTRICT

Everyone needs his own servant. The latter is an effective and valuable incentive for the financial turnaround of residency activities. But, buying a home in the current situation is a difficult task, as it has a significant use. A running Elegance family cannot afford the cost of this use. To take a decision on this movement, the government offers to extend housing finance to every individual at a low loan rate. The housing finance sector allows deduction in bonds. Home financing mode of housing on a credit basis in which we pay fixed payments often with high loan charges. A credit position was granted primarily based on the qualifications of the individuals and the standards of the bank. Many banks and financial institutions have entered the housing finance venues that offer modest advances at low borrowing costs. The cost of financing is an essential element of advances. Banks and economic institutions provide types of financial prices for credit ratings, for example, fixed and drifting. Banks provide housing finance as well as loans for development, growth, transformation, development etc. The main reason for this study is to think and dissect between housing finance technology and customer pleasure of SBI the largest public sector bank in India and LIC being the largest personal convenience financial institution in India.

Antecedents of Murabaha home financing among Muslim household – an integrated framework

PurposeThough Murabaha financing experienced substantial growth in several majority-Muslim countries, its market share in the Moroccan banking industry is still very narrow than other conventional banks’ instruments. The current research investigated the ability of an extended theory of planned behavior (TPB) framework to explain the main drivers of attitude and intention to use Murabaha financing among Moroccan households. The moderating effect of Islamic religiosity was also scrutinized.Design/methodology/approachData were collected via a survey of 512 Moroccan consumers and analyzed using the partial least squares (PLS) technique.FindingsFirst, attitude toward Islamic banking products is a key predictor of consumer intention to use Murabaha financing. At the same time, consumers’ attitudes are influenced by Islamic financial literacy, subjective norms, behavioral control and profit and loss sharing. Islamic religiosity was also found to positively moderate the link between attitudes towards Islamic banking (IB) and intention to use Murabaha financing, e.g. positive attitudes toward IB are more likely to convert into an intention to use Murabaha financing among Muslim consumers with higher levels of religiosity.Managerial implicationsTo boost consumers’ intention to use Murabaha financing, Islamic bank managers should consider further investment in advertising to enhance consumers’ awareness about IB products. Islamic banks should also consider digital and social media marketing to increase consumers’ awareness about the products and spread a positive e-WOM with regards to their products. Our findings emphasize the importance of Islamic religiosity in shaping Muslim consumers’ intentions to use Murabaha financing. Islamic banks ought to make sure that Murabaha financing contracts are strictly adherent to and compliant with Shari’ah principles. They should also train their frontline employees on Islamic financing activities so that they can effectively respond to the queries and questions of Murabaha potential consumers.Originality/valueThe study findings contribute to the IB literature by demystifying the key factors shaping Muslim consumers’ intentions to use Murabaha financing. The study also extends the literature by emphasizing Islamic religiosity as a basis for Muslim consumers’ behavior in the context of IB. To the best of our knowledge, this study is among the first to empirically investigate Muslim consumers’ intention to use Murabaha financing in North Africa and the Arab countries.Peer reviewThe peer review history for this article is available at: https://publons.com/publon/10.1108/IJSE-10-2022-0680

Gold-based housing financing model: proposing an alternative housing financing model for Islamic bank

Purpose This paper aims to propose a new housing finance mechanism through gold price as an alternative to interest rate in Islamic home financing, especially on Bai’Bithaman Ajil (BBA) contract. Design/methodology/approach This study using simulation approach to calculate the monthly installments for home financing using gold price references. In simple terms, propose a financing formula in the BBA contract by converting the selling price of the house to the gold price, and then the monthly installments also follow the actual gold price. The authors provide an example by simulating this formula using historical data and cases of housing financing at Indonesian Islamic banks. The authors compare housing financing models based on gold prices and interest rates. Finally, The authors can compare the two housing financing models that are affordable for low-income people. Findings The results show that in the initial period, monthly installments of BBA based on gold price were lower than home financing based on interest rate. This result makes it possible for low-income people who cannot access financing based on interest rates to access financing based on gold price. However, the total installments of financing based on gold prices are higher than the financing model based on interest rates. Research limitations/implications The paper confines one contract, namely, BBA, as it is claimed to be more Shariah-compliant than others. Practical implications These findings suggest an alternative model for Islamic banks and regulatory authorities in Indonesia to replace the interest rate reference with the gold price in BBA contract housing financing. This model can offer competitive advantages for Islamic banks, including lower initial installments and inflation-protected profits, serving as a means of differentiating them from conventional banks. Social implications Gold price-based housing financing model in Islamic banks will increase the affordability of housing financing for low-income people. Originality/value This paper tries to solve two problems, namely, first, the problem of assuming that Islamic and conventional banks are the same, and second, the problem of housing finance affordability. This study needs to be explored.

Nursing home finances associated with real estate investment trust and private equity investments.

In 2021, real estate investment trusts (REITs) and private equity (PE) held investments in 1915 (16%) and 1569 (13%) US nursing homes (NHs), respectively. We created a database of REIT and PE investments in NHs, merged it with Medicare Cost Report data (2011-2019), and used a difference-in-differences approach within an event-study framework to compare NH spending and financial performance before and after REIT or PE investment to NHs that did not receive REIT or PE investment. REIT investments were associated with higher total wages (3%), total nursing wages (3%; both logged, per resident day [PRD]), and current ratio (81%). PE investments were associated with lower net patient service revenue (7%), total expenses (7%), and total wages (8%; all logged, PRD). The impact of REIT and PE investments in NHs may vary in different market conditions, as may occur in the current environment of low, falling NH profits, potentially higher minimum staffing requirements, and rising interest rates. Therefore, it is important for stakeholders to understand the impact of these large, growing investments on the financial performance of NHs.

Home Financing: Islamic Perspective and Literature View

This study was conducted to examine the perception of Islamic home financing within the scope of the Islamic banking sector in terms of scientific research in published journals that discuss the development of Islamic home financing. The method used is descriptive statistical analysis with meta-analysis, bibliometrix and sentiment analysis from secondary data in the form of 82 papers published and indexed by Scopus in the last 13 years, then processed using Microsoft Excel 2016 and SentiStrength software. The results show that research on Islamic home financing in the scientific literature is still quite rare even though it has increased from year to year. The results of the sentiment analysis show that there is a tendency for perceptions that tend to be vague in the scientific literature about the existence of Islamic home financing, with neutral sentiment at 39%, positive sentiment at 29%, negative sentiment at 29% and the remaining high negative sentiment at 3%. This study is the first study that discusses sentiment analysis on the theme of Islamic home financing research with primary data.

Islamic home financing products: a study of customer intentions in Indonesia

Purpose Islamic home financing products with Murabaha contracts are widely favored among the Muslim community in Indonesia, given that the country has a population of over 230 million Muslims. To facilitate the development of products and enhance public interest, it is important for Islamic banking institutions to comprehend the elements that may impact the intents of Muslim communities in Indonesia when selecting Islamic home financing products with Murabaha contracts. The purpose of this study is to ascertain the many aspects that may have an impact on the decision-making process of Muslim communities in Indonesia when selecting Islamic home financing product that use Murabaha contracts. Design/methodology/approach The partial least square-structural equation modeling data processing techniques will be used to process and evaluate these components. The data used in this study was acquired by administering questionnaires to a sample of 298 Muslim communities, which were randomly selected from a pool of 301 possible customers of Islamic house finance in Indonesia. Findings The results of this research show that attitude, subjective norms and perceived behavioral control have positive influence on intention to choose an Islamic home financing scheme with Murabaha agreement, while price fairness of Islamic home financing and Islamic altruism have direct and indirect influence on intention to choose Islamic home financing. Research limitations/implications Analyzing factors that affect intention to choose Islamic home financing product under Murabaha contract is essential. Future study is required to analyze other Islamic home financing products, such as istisna, ijarah muntahia bi tamlik and diminishing musharakah. This study only serves as a foundation for further investigations into conventional approaches to home financing in emerging nations. The areas can be expanded to be implemented in other countries. Practical implications It is anticipated that Islamic banks have the capacity to cultivate a favorable and constructive perception, hence fostering a positive disposition among the Muslim populace in Indonesia. Furthermore, it is essential for Islamic banks to guarantee that all stakeholders within the sharia-compliant institution, particularly the frontline staff, have enough expertise and understanding of the intricacies of Islamic home financing products including Murabaha contracts, which are intended for prospective customers. In the foreseeable future, it is anticipated that the Muslim population in Indonesia would exhibit a greater intention toward the use of Islamic home financing solutions that use Murabaha contracts, facilitated by the establishment of a conducive environment. Originality/value This research integrates the impacts of pricing fairness and Islamic charity as a modified model, alongside the theory of planned behavior model, to examine the influence of these factors on individuals’ intentions to use Islamic home financing in Indonesia.

EMortgage and Crypto-Mortgage in Home Finance

eMortgage and Crypto-Mortgage in Home Finance

The Moderating Role of Islamic Corporate Social Responsibility in Shaping Customers’ Intention to Adopt Islamic Home Financing: A Conceptual Framework

The Moderating Role of Islamic Corporate Social Responsibility in Shaping Customers’ Intention to Adopt Islamic Home Financing: A Conceptual Framework

United States' Nursing Home Finances: Spending, Profitability, and Capital Structure.

Little is known about nursing home (NH) financial status in the United States even though most NH care is publicly funded. To address this gap, this descriptive study used 2019 Medicare cost reports to examine NH revenues, expenditures, net income, related-party expenses, expense categories, and capital structure. After a cleaning process for all free-standing NHs, a study population of 11,752 NHs was examined. NHs had total net revenues of US$126 billion and a profit of US$730 million (0.58%) in 2019. When US$6.4 billion in disallowed costs and US$3.9 billion in non-cash depreciation expenses were excluded, the profit margin was 8.84 percent. About 77 percent of NHs reported US$11 billion in payments to related-party organizations (9.54% of net revenues). Overall spending for direct care was 66 percent of net revenues, including 27 percent on nursing, in contrast to 34 percent spent on administration, capital, other, and profits. Finally, NHs had long-term debts that outweighed their total available financing. The study shows the value of analyzing cost reports. It indicates the need to ensure greater accuracy and completeness of cost reports, financial transparency, and accountability for government funding, with implications for policy changes to improve rate setting and spending limits.

An analysis of housing affordability in Malaysia: random effect approach

Purpose The purpose of this study paper is to highlight certain related barriers and issues of housing affordability and examine the factors that influence housing affordability in Malaysia. Design/methodology/approach This study used panel data including several variables, namely, household expense, population, home financing, interest rate, inflation rate (IF) and rental rate (RR). The regression models of panel data, namely, the ordinary least square model, the fixed effects model and the random effects model, were evaluated for their suitability. Findings The findings revealed that RR and IF have a positive and significant impact towards housing affordability. The results provide strong evidence that RR as alternative in determining the home affordability as it helped in reducing the cost and the financing duration period of houses while at the same time increasing the level of capability of homeownership. Meanwhile, the level of IF has positive and significant impact towards housing affordability because it will cause a drop or increase in the purchasing power of households, as well as a decline or increase in the capability to own a house. Research limitations/implications The most significant aspects to consider when analysing housing affordability in Malaysia are demand and supply. However, this study focuses on only five variables and only covers Malaysia. As a result, future researchers should analyse the study’s location, such as by region or district, and include additional variables from both the demand and supply sides. Homeownership of affordability requires a broader and more realistic definition in the current context of a more disruptive environment where technology such as fintech, blockchain and the internet of things acts as enablers for not only promoting homeownership but also ensuring homeownership sustainability. As a result, democratising Islamic home financing appears to be a viable option that requires rethinking, and further research is recommended. Practical implications The study proposes an end-to-end solution to promote homeownership levels by considering the level of RR as significant variables among stakeholders such as the house buyers/owners, sellers, investors as well the government agencies in influencing affordability in Malaysia. Originality/value This paper discusses the indicators of housing affordability index over the 21-year period of 2000–2020, covering all states in Malaysia. The comparison of affordability level can be seen through all states and by regions. Besides that, the findings revealed that RR and IF have a positive and significant impact towards housing affordability. RR is considered an essential variable in promoting homeownership in Malaysia and warrants further investigation towards policy implication. This paper also provides contribution on data on RR by states in Malaysia that can be used by policymakers to some extent.

Government digital policy breaks the mystery of “limited participation” in China's home finance market

This study uses a two-step approach to construct a multi-period double-difference model and introduces a quasi-natural experiment of the Broadband China pilot policy to investigate whether household financial market participation at the urban level is affected by the digital economy, which is significant for promoting Chinese households' shift from savings to investment and alleviating the long-standing problem of insufficient household financial market participation in China. In terms of direct impact, the digital economy increases the household financial market participation rate of urban residents by 3.26%, and increases the financial market participation rate of highly financially literate households by 2.14%; in terms of indirect impact, the development of the digital economy increases the total number of household smart Internet devices by 8.27%, and similarly increases the attention to household financial information by a significant 4.22%, which further positively influences the household financial market participation rate. This paper also evaluates the individual and regional differences of the digital economy on household financial market participation, and the estimated causal effect of the digital economy on household financial market participation is purer, which expands the scope of research on the digital economy and household financial market participation, and provides a certain reference basis and policy inspiration for the government to promote the construction of the digital economy.

Democratizing Islamic home financing and reimagining fractional homeownership model: a conceptual framework via big data and blockchain technology

PurposeThis paper aims to propose a model for democratization of Islamic home financing to tackle the issue of sustainability of homeownership affordability.Design/methodology/approachA conceptual framework and fractional equity model (FEM) are developed to incorporate big data analytics, artificial intelligence and blockchain technology in an ecosystem for affordability and sustainability of homeownership via the proposed financing model. In addition, the FEM adopts the simulation approach to show its validity in terms of liquidity when compared with traditional home financing. In this regard, this paper is focused on developing and demonstrating the feasibility of a new financing model, rather than testing specific hypotheses or relationships. This is to propose the democratization model for Islamic Home Financing that will not benefit the prospective home buyers without compromising the profitability of the financial institutions.FindingsThe findings indicate that the proposed end-to-end solution within the financing ecosystem can lead to more efficient matching market between the buyers and sellers of houses, reduced transaction costs, greater transparency and enhanced efficiency which in the end could lead to lower costs of owning homes and sustained financial resilience among house owners. The findings indicate that the FEM model is able to increase homeownership with more elements of liquidity, marketability and sustainability for homebuyers.Research limitations/implicationsThis research highlights the potential of big data and blockchain technology in democratizing Islamic home financing and evidence that the transfer of ownership is possible through tokenization. However, this will require a mature financing environment to adapt the technology for practical application.Practical implicationsThe model proposes a solution to propagate shared prosperity among stakeholders such as the house buyers/owners, sellers, investors as well the government agencies. The proposed FEM model provides alternative home financing that is more marketable, flexible and sustainable for households/buyers and financiers.Social implicationsIt is hoped that with the proposed financing ecosystem to promote affordability and sustainability of homeownership via big data analytics, artificial intelligence and blockchain technology can lead to greater financial resilience for homeowners which can then be translated to enhanced well-being, increased productivity and can further promote economic growth.Originality/valueThis research is a concept paper based on academic research and industry collaboration with a technology provider.

Musyarakah Mutanaqisah: A Systematic Literature Review

The present research aims to highlight trends in the previous research conducted on the Musyarakah Mutanaqisah arrangement. This research conducted a systematic literature review on the Musyarakah Mutanaqisah arrangement on the Scopus database from 2018 until July 2023. This research includes 21 journal articles from the 29 documents retrieved from the Scopus database. It was found that interviews and questionnaire surveys were the most frequently used methods in researching Musyarakah Mutanaqisah. Diverse variables have been studied in previous research. Most previous research on the Musyarakah Mutanaqisah arrangement was carried out in Malaysia since Malaysia is the leader in Islamic finance. Not all previous research was supported by theories or models. Most of the previous research on Musyarakah Mutanaqisah has focused on home financing facility. The findings from the present research can provide the foundation for future research on the Musyarakah Mutanaqisah arrangement.

ANALISIS MAQASID SYARIAH DALAM PENGEMBANGAN PRODUK PADA BANK SYARIAH INDONESIA (BSI) DI KOTA SAMARINDA

Bank Syariah Indonesia was established on May 17, 2000. Although Sharia banking products and services have grown rapidly in recent years, there are still obstacles, such as the lack of public knowledge about Sharia banking products and services. This is because some people still prefer conventional banking products that are considered more familiar and easier to understand. The purpose of this research is to identify the products available at Bank Syariah and analyze their Shariah Maqasid and strategies.
 The study was conducted from September 2022 to February 2023 at 5 BSI branch offices in Samarinda. The research method used was a descriptive study with a qualitative approach, and the data was collected through documentation analysis of the BSI products available on its official website. The data was then analyzed using Miles and Huberman's formula.
 The results showed that BSI's products include Hifz al-Maal savings account, Ishlah (improvement) Mudharabah deposit, Tazkiyah (purification) Sharia financing, Hifz al-Maal (wealth protection) Sharia credit card, Kaffah (balance) Sharia home financing, and Sharia investment to maintain balance and community welfare. The strategies that can be taken to promote Sharia banking include improving product quality, developing technology-based products that meet the needs of the public, and collaborating with the government.

THE IMPACT OF HOME FINANCING COSTS AND THE BUILT ENVIRONMENT ON THE DEPRESSION LEVELS OF LOWER-INCOME EMPLOYEES WORKING FROM HOME DURING THE COVID-19 PANDEMIC (MARCH 2020 - MARCH 2021)

As a result of COVID-19 which was at its height between March 2020 and March 2021, the Malaysian government was forced to impose a Movement Control Order in phases to limit mobility. Consequently, many employees, including those from lower-income (B40) groups, were compelled to work from home (WFH). The movement limitations caused severe losses in income, and many had to alter the nature of their work to adapt to the WFH requirements. Concern with the mental health issues which have become a serious issue worldwide due to the increasing psychological damage caused by COVID19, this study, through questionnaire of lower income employees working from home in Penang Island, Malaysia, aims to contribute to the study of the quality of live and impact of their habit towards built environment when working from home. Data analysis is performed using SEM-PLS to examine the impact of housing cost and built environment on WFH productivity levels. This was subsequently extended to observe the influence of productivity levels on levels of depression. The results show that home financing costs and the built environment positively influenced WFH productivity levels but at the expense of higher levels of depression. The results of this study may be of interest to policy makers who need to plan mental health awareness programs due to financial worries and confined space environment for lower income group, as health culture could foster healthy equitable communities and well-being physically and mentally.

The asymmetric impact of macroeconomic variables on Islamic bank home financing in Indonesia

Purpose – The study investigates the performance of non-performing financing (NPF) in the housing sector concerning the asymmetric influence of macroeconomic conditions. Methodology – The method of the study adopts nonlinear autoregressive distributed lag (NARDL), while the data of the study ranges from 2014m6 to 2022m2.Finding – The findings reveal an asymmetric relationship between macroeconomic variables and NPF is present both in the short and long run. In addition, the COVID-19 has worsened the NPF of Islamic banks' home financing in some sectors in the short run, while only such financing in the flat and apartment market has suffered during the pandemic in the long run.Implication – The implication of the study suggests that the Islamic banking industry and financial authority need robust risk management and financial policies, respectively, to achieve and maintain the stability of Islamic banks in home financing activities. Originality – The study is original in measuring the impact of macroeconomic influences on Islamic banks' home financing from a nonlinear viewpoint.