BQS514 Research Methodology on Housing Prices PDF

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1 LITERATURE REVIEWFactors that affect the price of housing in MalaysiaThe prices of housing are intimately linked to homeowners' affordability. The higher authorities in this area are doing vital things to ensure that housing prices are commensurate with the overall income level. Increased house pr...

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1.0 LITERATURE REVIEW

Factors that affect the price of housing in Malaysia

The prices of housing are intimately linked to homeowners' affordability. The higher authorities in this area are doing vital things to ensure that housing prices are commensurate with the overall income level. Increased house prices have driven the housing market expansion. In Malaysia, the primary challenge now is the failure to purchase a home and the increase in property costs. Some groups that are lower middle incomes and young generations, including recent graduates, have been confronted with this difficulty and have just begun their careers. The increased housing price caused the problems of inaccessibility. The price of housing grows due to several variables such as fast development and the growing trend in building costs.

A. Rapid Urbanization & Population The population in Malaysia is increasingly expanding in today's society. The population wanted more houses to stay, however the growth of housing in Malaysia is slow because of the poor manufacture of housing. Rapid urbanization may be the main engine of a home market in a country. The growth of urban population has helped to transform the household structure in the previous ten (10) years, owing to rapid urbanisation. Abu Zarin, & Md. Bujang, Anthony Jiram. Anuar (2015) concluded that a substantial contribution to housing growth was made by the high rate of urban expansion caused by migration, increasing population and distribution of income. The total sum of metropolitan centres with populations of 10,000 or above in Malaysia is increasing every year by 11 percent. (Mahiswaran, Tan, Paul Anthony, 2016).

Ernawati, Hasnanywati, & Atasya, (2016) claimed property prices were also affected. Housing sites can assist inhabitants select their chosen way of life by evaluating the chances for research as well as jobs and access to services and facilities. The suitable housing framework also adds value for the property. The house would certainly have a large housing price because of the facilities if, for example, it was near a school, retail centre, bank or other places that offer the lodging to persons.

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According to Ernawati, Hasnanywati, and Atasya (2016), a study conducted in Hong Kong by Micheal, H.C.H., and L.H.C. Rebecca (2002) revealed that convenient access to public transportation railway is a significant aspect when purchasing a property. Houses adjacent to administrations and offices and a short distance from employment might help communities save money on transportation costs. These kinds of residences are obviously expensive, which has an impact on housing affordability.

Mahiswaran, Tan and Paul Anthony (2016) identified the urban city to be residence to almost 70% of the Malaysian population. In Malaysia, internal development accounts for 68.8% in the decade 1995-2005. The interest in housing is presently developing industriously, due to the rapid transformation into urbanisation. The number of children and adolescents is also increasing and will certainly add to possible housing difficulties as they become older and the requirement for housing grows higher. The high population expansion in the future would result in a rise in the market's housing demand.

B. Rising Trend in Construction Cost

Construction materials usually relate to raw materials, components and product packaging, hardware and machinery. The structural materials used are generally solid, block and steel structures. Substances like tapping and coating composed of steel or wood typically just serve as a guide for building (Mansur, Abdul Hamid, & Yusof, 2016).

According to Mahiswaran, Tan, and Paul Anthony (2016), the construction cost includes labour costs, materials and equipment for buildings as set out in the report (Kassim, 2005). The cost of building may be defined as an asset of project planning, planning cost, cost estimate, and cost of control over material costs, labour costs, innovation costs, and transportation costs. The rising cost of construction materials has compelled developers to protect their profits by significantly hiking house prices.

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The research by Ernawati, Hasnanywati & Atasya (2016), in the last five years the price of raw materials has grown from 15 to 30 percent, as reported by Ong, T.S (2013). It should be mentioned that skilled personnel work as engineers, architects and labor costs included in construction and influence the increase in building expenses. The developer must thus increase the price each residential unit. The requirement to supply local infrastructure and fulfil several tasks has simultaneously forced private developers to enhance total building costs. The costs are therefore applied straight to the higher home price. Mansur, Abdul Hamid, and Yusof (2016) demonstrated that ordinary cost materials can continuously increase by more than 10 percent. They might be surprising and grow in more than half a time. Every year, the machinery and equipment rates will rise by 4% to 10%. The most important issue that affected housing prices was high gasoline prices. Also, of essential importance for machinery and equipment were high fuel prices, high administrative expenses, high rent rates, high maintenance costs and high interest on loans. These fees raise the cost of transit and consequently the cost of the property automatically. Moreover, there are hefty premiums to be paid for every housing project to developers by the federal and state authorities (Atasya , Ernawati , Hasnanywati , & Hamizah , 2015). This expense will certainly be included in the price of the house. The government must reduce developers' payments so that their building costs are reduced, allowing it to create more affordable homes, which may also reduce their housing prices with the lower middle-income groups and younger generations and developers. Finally, the key conclusion is that the causes driving Malaysia's growing home prices include rapid development and population growth and increasing building costs. In addition, the results will be presented. This would solve the problems of inaccessibility in Malaysia between lower middle-class people and youthful generations. The government of Malaysia, policymaker, developer and other associated parties should thus continue to make efforts to boost affordability, so that lower middle and youngest groups may own a property.

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2.0 CITATION 

Mansur, Abdul Hamid, & Yusof (2016) found that materials with normal cost can expand over 10% consistently.

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The research by Ernawati , Hasnanywati , & Atasya (2016), which was stated by Ong, T.S (2013), in the last five years, the price of raw materials has risen from 15% to 30%.

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According to Mahiswaran , Tan , & Paul Anthony (2016), construction cost is the expenses that comprises such as labour cost, material, equipment in developing of houses as stated by (Kassim, 2005).

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Substances such as scaffolding and formwork made of steel or wood are often used only as a guide to construction work[ CITATION Man16 \l 17417 ].

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3.0 REFERENCES

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Atasya , O., Ernawati , M., Hasnanywati , H., & Hamizah , A. (2015). Exploring the Elements of Housing Price in Malaysia. Asian Social Science; Vol. 11, No. 24; 2015, 26-38.

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Bujang, A., Anthony Jiram, W., Abu Zarin, H., & Md. Anuar , F. (2015). Measuring the Gen Y Housing Affordability Problem. International Journal of Trade, Economics and Finance, Vol. 6, No. 1, 22-26.

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Ernawati , M., Hasnanywati , H., & Atasya , O. (2016). Factors Influencing the Housing Price: Developers’ Perspective. World Academy of Science, Engineering and Technology International Journal of Humanities and Social Sciences Vol:10, No:5, 2016, 1677-1682.

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Mahiswaran , S., Tan , K., & Paul Anthony , M. (2016). A Study on Housing Price in Klang Valley, Malaysia. International Business Research; Vol. 9, No. 12; 2016, 103109.

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Mansur, S., Abdul Hamid, A., & Yusof, N. (2016). Rising Trend in Construction Cost and Housing Price . Journal of Advanced Research in Business and Management Studies Vol. 3, No. 1. , 94-95.

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