The factors affecting the people's housing and land buying decisions in residential areas in Soc Trang city, Vietnam

ABSTRACT:

This study is to analyze the factors affecting the land and housing purchasing decision in residential areas in Soc Trang City, Vietnam. This study used the multiple linear regression analysis method with data sets collected from 200 households living at residential areas in Soc Trang City. The study’s results show that the factors including influencers, living and education conditions and transaction convenience affect the land and housing purchasing decision.

Keywords: purchasing decision, land and housing, residentials, Soc Trang City.

1. Introduction

In recent years, the demand for buying housing of people and land is increasing. Because the ownership of real estate is considered an important measure to assess person's social status, which is also the concept of Vietnamese people living for a long time "settling in the bliss". The housing market is no longer the monopoly of big cities such as Hanoi, Ho Chi Minh, or Da Nang, but it has been spreading to most regions, especially the satellite "satellite" provinces. Soc Trang is one of the provinces with many advantages in housing and land investment. However, with the high price, it is difficult for people with a low and middle income to own an apartment or land in the residential area as desired. Recently, due to the evolution of the epidemic situation, the situation of pushing housing prices beyond the actual value is no longer present and gradually turning back to a true value, which helps people participate in transactions more. When deciding to own land and housing, people care and choose products or projects that suit actual needs, financial capability, reputable investors, payment policies, etc. On the other hand, real estate companies need to understand the factors that lead to the decision that people will buy land and housing so that supply and demand can meet each other more easily. For the above reasons, the study "The factors affecting the people’s housing and land buying decisions in residential areas in Soc Trang City" is conducted.

2. Theoretical background

In recent years, there are many studies on housing and land in residential areas. In particular, the decision to buy housing and land of people in the residential area is influenced by many different factors. Reality show that population growth requires a huge area for people's housing needs. Al-Nahdi & Ghazzawi (2015) showed that the group of attitude factors positively affects the intention to buy real estate, while the group of location factors, living space, public service and reference (the influence of Friends and Other Reference Groups) did not have a significant linear relationship with a customer's intent to purchase real estate. In addition, Singh (2013) showed that the factors affecting the decision to buy a house of the Indian people include: basic amenities, finance, connectivity, and proximity. In particular, basic amenities and finance have the strongest influence on people's houses buying decisions. On the other hand, Opoku & Muhmin (2010) showed that the factors influencing the decision to buy a home by low-income people in Saudi Arabia include: financial considerations, private living space and aesthetic aspects. Of the house, these are 3 important factors in the decision to buy a house for low-income people.

The three less important factors are outer space, street location, and proximity to family members. In addition, Phan Thanh Si (2012), identified factors influencing customers' decisions to buy houses in Vietnam, including house characteristics, living space, financial status, house distance to the center, landscape environment. In which, factors of living space and the distance of the house to the center have the strongest influence on customers' buying decision. In buffer cities where has the lower land prices, those who cannot afford to buy a home would choose to live in there more than. This is a potential market, housing investors must know the characteristics of prospective homebuyers and the price factor is the most important factor (Maoludyo & Aprianingsih, 2015). Buying a home is considered the biggest financial decision in a person's life. The most important factors influencing first-time homebuyers' decisions include home price, location, family transition and neighborhood (Abdullah, et al., 2012). Recently, Aryani & Tu (2017) was conducted a survey about the demand for residential housing in Indonesia. The study results showed that comfort, security and self-actualization influenced to decide to buy of homebuyers. Besides that, age influenced on decide to buy housing of people here.

3. Research methods 3.1. The proposed research model

The research model is shown in Figure 1 based on the experimental research models of the authors Al-Nahdi & Ghazzawi (2015); Meenakshi (2016); Singh (2013); Abdullah, et al (20112); Maoludyo & Aprianingsih (2015); Aryani & Tu (2017). The six group factors comprise six hypotheses from independent variables and dependent variables.

3.2. The scale

The scale of decisions to buy land and houses of people in the residential area in Soc Trang city is shown in Table 1 below. The observed variables are measured by a 5-level Likert scale (from 1: totally disagree to 5: totally agree).

Table 1: The scale of decisions to buy land and houses

Source: Collection by the author, 2020

3.3. Data collection and analysis

This study investigated a sample size of 200 observations. These are 200 households who have bought land and houses in residential areas in Soc Trang city. Survey by the method of random sampling according to the list of customers with real estate transactions at real estate companies and notary offices in Soc Trang city. Cronbach's alpha testing method, exploratory factor analysis, and multiple linear regression are used to determine the factors that influence people's buying decisions.

4. Research results

To determine the factors affecting the decision to buy houses and land of people in the residential area in Soc Trang city, the steps to test the reliability of the scale (Cronbach's Alpha), the exploratory factor analysis method and the multiple linear regression method were used to estimate. The regression results are shown in Table 2 below:

Table 2: The results of the regression model estimate

Note: ***; **; *: corresponding to the significance levels 1%; 5%; and 10%

Source: Processing survey data of 200 people in Soc Trang City, 2020.

To ensure the regression model used is consistent and statistically significant, violations of the linear regression model are checked. Specifically, the VIF coefficients of the independent variables are all less than 3 (satisfying the necessary condition as VIF <5), so the model does not have the phenomenon of multicollinearity. In addition, the test results showed that the F coefficient of the model is 18.914 with the significance level = 0.000, which is smaller than the significance level α = 1%, which means that the regression model is used significantly. Coefficient R2 = 0.408, that is, the independent variables explain 40.8% of people's decisions to buy land and houses in residential areas in the city.

The estimation model showed that, among the 07 factors included in the study, there were 06 factors that have a statistically significant impact on the people's decision to buy land and housing. These factors include: F1 (Characteristics of the residential area); F2 (Financial situation); F3 (Living space); F4 (Faith from relatives); F6 (Living environment and educational conditions); and F7 (Convenience when dealing and using). All these factors positively affect people's decisions to buy land and houses.

5. Conclusion

The analysis results showed that the decision to buy land and houses in the residential areas of the people of Soc Trang city is affected by factors characteristics of the residential area, financial situation, faith from relatives, living environment and educational conditions, and Convenience when dealing and using. This showed that, there are many conditions from the buyers themselves and the characteristics of the residential area that lead to the people's decision to buy land and houses. This result is completely reasonable because housing is a high-value asset, requiring people to consider carefully before deciding to buy. This article is useful information to help real estate investors in Soc Trang city have plans to build, design and adjust prices accordingly so that people can own real estate in the residential areas is getting more and more.

REFERENCES:

[1] Abdullah, S. L.,Nor, S. I., Jumadi, S. N., & Arshad, S. H. (2012). First-time home buyers: factors influencing decision making, 2012 International Conference on Innovation and Technology for Sustainable Built Environment (ICITSBE 2012). 27-28 March 2012, Perak, MALAYSIA. Ref No.: EE-09. (Trích dẫn lại theo quy định về tài liệu tham khảo tại Hội thảo)

[2] Adair, A., Berry, J., & McGreal, S. (1996). Valuation of residential property: Analysis of participant behaviour. Journal of Property Valuation & Investment, 14 (1), 20-35.

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[4] Aryani, N. P., & Tu, K. J. (2017). The Factors Affecting the Home Buying Decisions Related to House Physical Characteristics in a Middle-Up Estate in Surabaya, Indonesia. Architecture science, 15(June 2017), 1-15.

[5] Chia, J., Harun, A., Kassim, A. W. M., Martin, D., & Kepal, N. (2016). Understanding factors that influence house purchase intention among consumers in Kota Kinabalu: An application of buyer behavior modeltheory. Journal of Technology Management and Business, 3(2), 94-110.

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[7] Maoludyo, F.T., & Aprianingsih, A. (2015). Factors influencing consumer buying intention for housing unit in Depok. Journal of business and management, 4(4), 484-493.

[8] Opoku, R., & Abdul-Muhmin, A. (2010). Housing preferences and attribute importance among low-income consumers in Saudi Arabia. Habitat International, 34, 219-227.

[9] Phan Thanh Si. (2012). Key factors affecting house Purchase decision of customers in vietnam. International School of Business University of economics Ho Chi Minh City.

[10] Singh, T. (2013). Identifying key factors affecting purchase decision of residential apartments: an exploratory study in peripheries of chandigarh. International Journal of Applied Services Marketing Perspectives, 2(3, July – September).

Các yếu tố ảnh hưởng đến quyết định mua nhà và đất tại các khu vực dân cư của thành phố Sóc Trăng, Việt Nam

Th.S Nguyễn Minh Tân

Đại học Công nghệ Cần Thơ

Th.S Tăng Thị Ngân

Cao đẳng Kinh tế Kỹ thuật Cần Thơ

Th.S Lương Văn Thông

Đại học Công nghệ Cần Thơ

TÓM TẮT:

Nghiên cứu này nhằm phân tích các yếu tố ảnh hưởng đến việc ra quyết định mua nhà và đất tại các khu vực dân cư thuộc thành phố Sóc Trăng, Việt Nam. Nghiên cứu được thực hiện dựa trên việc phân tích dữ liệu từ 200 hộ dân sinh sống tại các khu dân cư của thành phố Sóc Trăng và áp dụng phương pháp phân tích hồi quy tuyến tính. Kết quả nghiên cứu cho thấy các yếu tố ảnh hưởng đến việc ra quyết định mua nhà và đất gồm tác động từ những người có tầm ảnh hưởng, điều kiện sinh sống và giáo dục, và mức độ thuận lợi trong giao dịch.

Từ khóa: Quyết định mua nhà và đất, khu dân cư, thành phố Sóc Trăng.

[Tạp chí Công Thương - Các kết quả nghiên cứu khoa học và ứng dụng công nghệ, Số 1, tháng 1 năm 2021]