DETERMINANTS OF DEMAND FOR MORTGAGE FINANCE IN KENYA: A CASE OF NAIROBI COUNTY
DOI:
https://doi.org/10.47672/ajf.121Keywords:
, Price of mortgage cost of mortgage application, income level, promotion, demand of mortgage finance.Abstract
Purpose: The purpose of the study was to determine the determinants for the demand of mortgage finance in Kenya.
Methodology: The study adopted a descriptive research design. The target population of this study was applicants for mortgage finance. Random sampling technique was used. The sample size was 384 respondents. Data was collected using structured questionnaires. The collected primary data was analyzed using Statistical Package for Social Science (SPSS) version 20. A binary logistic regression analysis was conducted. The Pearson Product was used to analyze the data. The findings from the analysis were organized and summarized in form of percentages, means ratios and frequencies and presented using tables and pie charts.
Results: The results indicated that the likelihood of cheap mortgage substitutes resulting to low demand for mortgage finance in Kenya was 4.911 times higher than more costly mortgage substitutes. The findings further indicated that the likelihood of high legal cost and high stump duty cost causing low mortgage demand are 2.550 and 2.274 times higher than when the costs are low. The findings also indicate that the likelihood of low income levels causing low demand for mortgage substitutes was 6.369 high than high income levels. Finally the findings indicate that the likelihood of lack of promotion causing low mortgage demand was 5.808 higher than having promotion.
Unique contribution to theory, practice and policy: The study recommended that mortgage financing institutions should consider the cost of mortgage substitutes, cost of mortgage, income level and promotion in order to increase the demand for mortgage finance in Kenya.
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Copyright (c) 2017 Alfred Irungu, Dr. Brigitte Okonga
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