The effect of behavioral changes from generation Y during pandemic on Indonesian housing prices growth
List of Authors
  • Djodi Adhikaputera

Keyword
  • COVID-19, Generation Y, House Preferences, Product Specifications, Future Considerations, Dweller Characteristics, Supplemental Factors, PLS-SEM

Abstract
  • During the COVID-19 Pandemic, the stagnant and even a declining growth of Indonesia residential property prices has become a popular issue and drawn the researcher’s attention about the details behind it, as in terms of buying preferences, changes due COVID-19 and solutions for the problem. The purpose of this study is to comprehend the effect of behavioural changes from Indonesian Generation Y during pandemic on housing price growth. Generation Y referred to in this study are Indonesian citizens born between 1991 to 1998 or early 2000 (Junior Gen Y) and between 1980 to 1990 (Senior Gen Y) who dominate Indonesia's population and also have a massive influence on GDP. COVID-19 forced a change in consumer behaviour which further leads to prioritize the most basic needs. This also brings changes to the effect of buyer preferences on house prices during the pandemic. This study also explains Generation Y's preferences in buying houses in order to understand which preferences will affect demand and house prices because it will also help several parties involved in housing transactions construct strategies to make the property more appealing to buy. The data used in this study is collected using quantitative methods by online survey with the total of respondents 219 limited to Generation Y who have a fixed income every month and are willing to own a house in Depok. The data is further processed using PLS-SEM analysis. The study found that COVID-19 has a negative effect on house prices through buyer preferences, particularly on dwellers characteristics. It is also found that Generation Y's preferences are still the same, but some things that are considered more important with the most important supplemental factors are then followed by future considerations, dwellers characteristics and product specifications. From these findings, recommendations for related parties are also given in the last part of this study.

Reference
  • 1. Chen, Z., & Khumpaisal, S. (2009). An analytic network process for risks assessment in commercial real estate development. Journal of Property Investment & Finance.

    2. Delmendo, L. (2021, February 22). Indonesia’s house prices remain more or less steady, amidst the pandemic. Global Property Guide. Retrieved March 5, 2021, from http://www.globalpropertyguide.com/Asia/indonesia/Price-History

    3. Eurostat, ILO, International Monetary Fund, OECD, United Nations Economic Commission for Europe, & World Bank. (2013). Handbook on Residential Property Prices Indices (RPPIs). UTB.

    4. Fornell, C., & Larcker, D. F. (1981). Evaluating structural equation models with unobservable variables and measurement error. Journal of marketing research, 18(1), 39-50.

    5. Ghozali, I., & Latan, H. (2015). Konsep, teknik dan aplikasi menggunakan Program Smart PLS 3.0. Universitas Diponegoro. Semarang.

    6. Hapsariniaty, A. W. (2013). Analisis Perbandingan Preferensi Masyarakat Golongan Menengah Dalam Memilih Hunian pada Gated Communities di Kawasan Kota dan Pinggiran Kota Bandung: StudiKasusKec. Kiara CondongdanKec. Parongpong (Comparative Analysis of Middle-Class’ Preferences Choosing to Live in Gated Communities in the Urban and Suburban area of Bandung: Case Study Kec. Kiara Condong and Kec. Parongpong). School of Architecture, Planning, and Policy Development.

    7. Hofman, E., Halman, J. I., & Ion, R. A. (2006). Variation in housing design: identifying customer preferences. Housing Studies, 21(6), 929-943.

    8. Kamal, E. M., Hassan, H., & Osmadi, A. (2016). Factors influencing the housing price: developers’ perspective. International Journal of Humanities and Social Sciences, 10(5), 1676-1682.

    9. lokadata. (2018, October 26). Membaca status kepemilikan rumah keluarga milenial Indonesia. Retrieved August 12, 2021, from https://amp.lokadata.id/amp/membaca-status-kepemilikan-rumah-keluarga-milenial-indonesia

    10. McLeod, S. (2007). Maslow's hierarchy of needs. Simply psychology, 1(1-18).

    11. Pradana, D. P., & Rahadi, R. A. (2020). Analysis of Housing Affordability by Generation Y Based on Price to Income Ratio in Jakarta Region. Am. Int. J. Bus. Manag, 3, 59-67.

    12. Rabbi, C. (2021, March 23). Pandemi Covid-19 Memicu Empat Perubahan Besar Perilaku Konsumen. Katadata. Retrieved August 15, 2021, from https://katadata.co.id/happy fajrian/brand/605a31cf8e81f/pandemi-covid-19-memicu-empat-perubahan-besar-peril aku-konsumen

    13. Rahadi, R. A., Wiryono, S. K., Koesrindartoto, D. P., & Syamwil, I. B. (2012). Relationship between consumer preferences and value propositions: a study of residential product. Procedia-Social and Behavioral Sciences, 50, 865-874.

    14. Ratcliffe, R. (2020, July 1). First coronavirus cases confirmed in Indonesia amid fears nation is ill-prepared for outbreak. The Guardian. Retrieved March 2, 2021, from https://www.theguardian.com/world/2020/mar/02/first-coronavirus-cases-confirmed-in-indonesia-amid-fears-nation-is-ill-prepared-for-outbreak

    15. Weimer, A. M. (1966). Real Estate Decisions are Different. Harvard Business Review, 105-112.