Base Lending Rate And Housing Prices: Their Impacts On Residential Housing Activities In Malaysia
AbstractThe construction sector, which had grown rapidly in the early 1990s, encountered slower grows after the financial crisis. The decline in the construction industry, however, is cushioned by the residential property construction. This paper examines empirically whether the increasing trend in residential property construction is related to changes in base lending rate and house prices. Pooled EGLS model (Cross Section Seemingly Unrelated Regression) is used to analyze the impact of lending rate and housing price upon the trading volume of residential housing activities. The results show base lending rate is the key determinant of residential housing activities. However, changes in housing prices may not necessarily influence residential housing activities in the country when there is a mismatch between current and desired housing for all. In view of the substantial number of housing left unsold, several recommendation and precautionary measures for housing provision should be made before it leads to a property glut. This study is crucial to housing developers and policy makers as any housing decisions not always should be made just on the basis of interest rates and house prices, but should pay more attention to the efficiency and effectiveness of housing delivery system in the country.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by Conference Master Resources in its series International Conference on Business and Economic Research (ICBER 2010) Proceeding with number 2010-060.
Length: 10 pages
Date of creation: Mar 2010
Date of revision:
Publication status: Published in Proceeding of ICBER 2010, March 2010
Contact details of provider:
Web page: http://www.internationalconference.com.my/proceeding.htm
Residential Housing Activities; Base Lending Rate; Housing Price Index;
Find related papers by JEL classification:
- M - Business Administration and Business Economics; Marketing; Accounting
You can help add them by filling out this form.
reading list or among the top items on IDEAS.Access and download statistics
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (ihfal).
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.