EFFECTS OF INTEREST RATES ON THE PERFORMANCE OF REAL ESTATE INDUSTRY IN KENYA: A CASE OF NAIROBI COUNTY

Purpose: The study sought to determine the effects of interest rates on the performance of real estate industry in Kenya: A case of Nairobi county.Methodology: The study adopted a descriptive survey research design.Results: The study findings revealed that lending interest rates had a negative and significant relationship with real estate growth in Nairobi. The findings show that deposit interest rates were insignificantly related to growth of the real estate firm in Nairobi. The long run model findings also revealed that overdraft interest rates had a significant relationship with real estate growth in Nairobi. The findings revealed that inflation had a negative and significant relationship with performance of real estate firms in Nairobi. GDP growth was found to have a positive relationship with the performance of real estate firms though the relationship was insignificant.Unique contribution to theory, practice and policy: The study findings revealed that lending interest rates have a negative and significant relationship with real estate growth in Nairobi. The study recommends that the CBK should implement monetary policies that aim to reduce the lending interest rates that financial institutions charge on lending so as to bring stability in the industries including real estate industry. The study recommends that the Central bank of Kenya as well as the Treasury should come up with monetary policies to regulate the rate of volatility in inflation rate in the long run since long term investors in real estate are likely to suffer loses if the economy is characterized by unstable rates of inflation. The study findings also indicated that GDP growth has a positive relationship with the performance of real estate firms in the long run. The study recommends that the government should reexamine the strategies and policies that aim to spur GDP growth.

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The Relationship between Interest Rates, Income, GDP Growth and House Prices

Research in Economics and Management ◽

10.22158/rem.v2n1p30 ◽

2017 ◽

Vol 2 (1) ◽

pp. 30 ◽

Cited By ~ 4

Author(s):

Ting Xu

Keyword(s):

Interest Rate ◽

Real Estate ◽

Interest Rates ◽

House Prices ◽

Gdp Growth ◽

The Real ◽

The Real Estate ◽

Control Power ◽

The Relationship

<em>This paper will analyse the relationship between interest rate, income, GDP growth and house prices. First, the control power of interest rate for the prices is limited. Second, people’s income increases, thus that also increases the demand for housing. But house prices are too high and will cause buying pressure. Third, the real estate industry’s growth and GDP growth have inseparable relationship, they interact with each other.</em>

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Application of ARMA Regression Model of Housing Prices Influence Factors of Xi'an

Applied Mechanics and Materials ◽

10.4028/www.scientific.net/amm.405-408.3340 ◽

2013 ◽

Vol 405-408 ◽

pp. 3340-3342

Author(s):

Hui Zhi ◽

Yue Fan Wang

Keyword(s):

Real Estate ◽

Regression Model ◽

Housing Prices ◽

Influence Factors ◽

Housing Price ◽

The Real Estate ◽

Housing Price Index ◽

Long Run ◽

The Government ◽

The Impact

By selecting the relevant factors affect the real estate price, with the qualitative analysis method to analyze the housing prices changes of Xi'an, and then establish ARMA regression model of the housing price index, found that the factors exist long-run co-integration. In order to better reflect the actual, the government policy as a dummy variable is introduced into the model to make regression results more significantly, showing that government policies play an important role in the control of the impact on real estate prices.

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The hegemony of the real estate industry: Redevelopment of ‘Government/Institution or Community’ (G/IC) land in Hong Kong

Urban Studies ◽

10.1177/0042098016679607 ◽

2016 ◽

Vol 54 (15) ◽

pp. 3403-3422 ◽

Cited By ~ 3

Author(s):

Joanna Wai Ying Lee ◽

Wing-Shing Tang

Keyword(s):

Hong Kong ◽

Real Estate ◽

Capital Accumulation ◽

Real Estate Industry ◽

Property Development ◽

The Real ◽

The Real Estate ◽

Local Literature ◽

The Government ◽

Government Institution

The high property price syndrome in Hong Kong has led to heightened concern about the role of landed capital in property development. Recently, the hegemony of the real estate industry has become a buzzword in local literature, but unfortunately there is neither adequate theoretical articulation nor informed understanding of the concept of hegemony. There is widespread misunderstanding of hegemony, equating it to domination by property tycoons. The local literature has overlooked the government-business collusion in constructing the common sense of society so as to dominate others. Through an empirical investigation of the redevelopment of ‘Government/Institution or Community’ (G/IC) land in Hong Kong, this article attempts to offer an alternative explanation to the land question of G/IC redevelopment by highlighting that the everyday life of the silent majority and of professionals has in fact perpetuated the hegemony of the real estate industry in Hong Kong. It is argued that the government, property developers, professionals, charitable organisations and the general public have altogether participated, in different ways and to different extents, in the capital accumulation projects of leading developer conglomerates in Hong Kong. A land (re)development regime has thus contributed to the property boom in Hong Kong.

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PRODUCTIVITY ASSESSMENT OF THE REAL ESTATE INDUSTRY IN CHINA: A TWO-STAGE MALMQUIST PRODUCTIVITY INDEX

International Journal of Strategic Property Management ◽

10.3846/ijspm.2021.14199 ◽

2021 ◽

Vol 25 (2) ◽

pp. 146-168

Author(s):

Xiao-xiao Liu ◽

Hui-hui Liu ◽

Guo-liang Yang ◽

Jiao-feng Pan

Keyword(s):

Real Estate ◽

Regional Analysis ◽

Development Stage ◽

Malmquist Productivity Index ◽

Productivity Index ◽

Real Estate Industry ◽

Two Stage ◽

The Real ◽

The Real Estate ◽

The Government

Considering that the real estate industry is a critical industry to promote the economy in China, it is necessary to measure the real estate performance. However, few studies about the performance evaluation of China’s real estate industry have focused on the production process. To fill this gap, this paper proposes a two-stage framework to investigate the real estate productivity of 30 sample provinces on mainland China from 2008 to 2015, based on a common-weight global Malmquist productivity index (MPI). The major findings are shown as follows: (a) the real estate efficiency is low, and it is mainly caused by the inefficiency in the sales stage, not the development stage; (b) the development trend of the real estate sector in China is sensitive to the government policies, and the fluctuations of MPI are consistent with the direction of policy adjustment during the observation period; (c) as for the regional analysis of MPI, we introduce the concept of the dependence degree of the economy on the real estate industry and predict that MPI in economically underdeveloped regions may decline in the future. Finally, policy recommendations are provided for the high-quality development of China’s real estate industry.

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The Risk Spillover Effects of the Real Estate Industry on the Financial Industry: A GARCH-Time-Varying-Copula-CoVaR Approach on China

SAGE Open ◽

10.1177/21582440211067226 ◽

2021 ◽

Vol 11 (4) ◽

pp. 215824402110672

Author(s):

Yunsong Xu ◽

Hanying Qi ◽

Jiaqi Li ◽

Ning Ding

Keyword(s):

Real Estate ◽

Spillover Effects ◽

Time Varying ◽

Real Estate Industry ◽

Financial Industry ◽

Financial Policies ◽

The Real ◽

The Real Estate ◽

Regulatory Policies ◽

The Government

This paper analyzes the multiple transmission mechanisms of the real estate industry’s risk spillovers to the financial industry. A GARCH-time-varying-copula-CoVaR model is used to measure the spillover effects and dynamic evolution trends of risk in the Chinese real estate industry. The results show that (1) in recent years, the risk spillovers from the real estate industry to the whole financial industry in China has been relatively high, and the possibility of systemic risks has increased. (2) The channel of the risk spillovers of the real estate industry into the financial industry has shifted from being concentrated within a traditional single banking industry to the accumulation and superposition of risk across the banking, securities, trust industries. (3) Current regulations have not fundamentally mitigated the risk spillovers. As such, this paper proposes three suggestions on financial policies and regulations: firstly, the government should reasonably regulate cooperation between the real estate industry and the financial industry, curb excessive speculation and abnormal fluctuations in real estate prices. Secondly, the government should maintain the continuity of regulatory policies, formulate differentiated policies according to the essential attributes of given industries, and eliminate risk contagion among the real estate industry and financial industries. Thirdly, the government should improve the macro prudential management framework.

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