Modelling Housing Mismatch for Affordable Housing Demand and Supply in Malaysia

Abstract

The housing mismatch between housing demand and supply in recent years has become a crucial agenda for enhancing the availability of affordable housing in Malaysia. This research paper presents a study on the factors that affect individuals and housing developers that keep them from owning and supplying affordable housing. This cross-sectional study validates the existence of a housing mismatch in Malaysia from a view of housing demand and supply. This study employed 400 respondents on housing demand and 120 respondents from housing developers who represented housing suppliers. The Partial Least Square Equation Modelling (PLS-SEM) method was used to develop the model and validate the data. By performing the composite reliability and convergent validity through PLS-SEM, 25 attributes from housing demand and 22 attributes from housing supply were found significant for the development of the structural housing mismatch model. The final output was established by findings their coefficients determination, path coefficient, effect size and predictive relevance towards variables of housing mismatch. The result indicates five factors with nine attributes in housing demand and 11 attributes from housing supply contributed to the existence of a housing mismatch at 12%. Finally, by incorporating an analysis of the significant findings, it becomes clear that identifying the features of housing mismatch from both sides enables the government to have strategic interventions. This underlines the importance of recognising the key features in guiding authorities aimed at minimising housing disparities.