Real estate investment decisions in COVID-19 crisis: the effect of perception and behavioral biases

Muhammad Ali, Leong Choi-Meng, Eugene Cheng-Xi Aw, Chin-Hong Puah and Abdulkadir Barut

International Journal of Housing Markets and Analysis, 2023, vol. 17, issue 1, 32-47

Abstract: Purpose - This study aims to examine the interconnectedness between investors' perceptions of assets and their behavioral factors with investment decisions during the COVID-19 pandemic in the real estate business in Pakistan. In this regard, this study predicted investment decisions using individuals’ perceptions of the asset (perceived asset quality, perceived asset price and perceived asset value [PAV]),and behavioral biases (overconfidence [OC], herding [HD], disposition effect [DE] and risk aversion [RA]). Design/methodology/approach - This study used a survey-based instrument to gather a total of 189 usable samples. The sample data were analyzed using partial least square structural equation modeling. Findings - The findings of this study indicated that PAV, OC and HD significantly predicted the investment decision, whereas DE and RA had an insignificant impact on investment decisions in the real estate business. In addition, this study found that PAV is the most important factor to predict investment decisions in real estate during the COVID-19 crisis. Originality/value - The authors are certain that the study findings reinforce policy implications for regulators, policymakers and financial institutions. The study findings are also useful and relevant if the real estate sector experiences a crisis in the future.

Keywords: Housing; Developing countries; Housing affordability (search for similar items in EconPapers)
Date: 2023
References: Add references at CitEc
Citations:

Downloads: (external link)
https://www.emerald.com/insight/content/doi/10.110 ... d&utm_campaign=repec (text/html)
https://www.emerald.com/insight/content/doi/10.110 ... d&utm_campaign=repec (application/pdf)
Access to full text is restricted to subscribers

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eme:ijhmap:ijhma-12-2022-0173

DOI: 10.1108/IJHMA-12-2022-0173

Access Statistics for this article

International Journal of Housing Markets and Analysis is currently edited by Dr Richard Reed

More articles in International Journal of Housing Markets and Analysis from Emerald Group Publishing Limited
Bibliographic data for series maintained by Emerald Support ().