Its objective is to testify the relationships among legal procedure, quality of product and service, price, location, financial situation and housing purchase decision.. The result demon
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Research Questions na
With these goals, the study was required to answer 5 key research questions”
- Research question 1: Do legal procedures influence strongly in homebuyers’ purchase decisions?
- Research question 2: Do products and services provided by housing supplierssignificantly influence home buyers’ purchase decisions?
- Research question 3: Does location of the house/ department impact on housing purchase decision?
- Research question 4: Is price of the house much more important to home buyers.
- Research question 5: Does the buyer’s financial situation influence purchase decision.
Factors affecting consumer behavior on purchasing house or department of individual who has bought or intend to buy it in the future in Hanoi.
- Space: Vinaland’s client in Ha Noi.
- Time: From March 2016 to May 2016
This thesis employs a quantitative approach to test hypotheses using primary data collected through a survey The questionnaire, designed for individuals who have purchased or are planning to buy a house in Hanoi, consists of two sections: one assessing home buyers' opinions on various housing purchase factors and their impact on purchase decisions and post-purchase satisfaction, and the other gathering demographic information about the respondents.
The thesis is divided into 4 chapters
Chapter 1: Literature review of consumer behavior and housing market
This chapter will provide theoretical framework for the research including fundamental concepts about consumer behavior and factors affecting consumer behavior as well as housing market.
This chapter provides a comprehensive overview of the research methodology, detailing the specific methodologies employed, the data collection processes utilized, and the formulation of factors and questions included in the questionnaire.
This chapter focuses on the results of analyzing collected data through applying SPSS software package but the research context and its objective is also presented.
This chapter will testify once again the research questions and then takes implications for buyers, brokers, construction investors and the government.
The thesis explores the factors influencing consumer behavior in the decision to purchase houses or apartments in Hanoi The findings aim to enhance housing development effectiveness both in Hanoi and across Vietnam By analyzing key elements that affect buyers' decisions, the research provides valuable insights for the government, construction investors, and brokers, enabling them to understand the challenges faced by homebuyers This understanding will facilitate the formulation of supportive policies, the improvement of service quality, and the provision of tailored advice for prospective homeowners.
Scope Toà
The study of consumer behavior is an unusually diverse discipline, and it has been defined in a variety of ways in the marketing literature.
General speaking, consumer behaviors are “activities people undertake when obtaining, consuming and disposing of products and services” (Blackwell,
Consumer behavior, as defined by Professor P Kotler and Keller at Harvard University, examines how individuals, groups, and organizations choose, purchase, utilize, and discard goods, services, ideas, or experiences to fulfill their needs and desires.
Another definition has been defined by Schiffman, Hansen, &Kanuk, 2012 is that
“consumer behavior in seeking, purchasing, using, evaluating and disposing of products and services that they expect to satisfy their personal needs”.
Consumer behavior encompasses the entirety of decisions made by individuals regarding the acquisition, consumption, and disposal of various goods, services, activities, experiences, people, and ideas, as defined by Hoyer & Macinnis (2010) This definition highlights the complexity of human decision-making processes over time.
Some past studies such as Fierr 2009; Huang & Yi, 2010; Opoku& Abdul-
According to Muhmin (2010), home buyers can be considered consumers engaged in various activities related to housing products, including selection, purchase, and utilization.
These studies investigated purchase decision-makingand the researcher also found out home buyers as consumers.
According to Schiffman's 2012 definition, consumer behavior encompasses the actions of individuals, groups, and organizations, involving not only the purchase of products but also their use and disposal.
LITERATURE REVIEW OF CONSUMER BEHAVIOR
Definition of consumer behaVIOT .- - 5< +s se +sezseseererrerrke 5
The study of consumer behavior is an unusually diverse discipline, and it has been defined in a variety of ways in the marketing literature.
General speaking, consumer behaviors are “activities people undertake when obtaining, consuming and disposing of products and services” (Blackwell,
Consumer behavior, as defined by Professor P Kotler and Keller at Harvard University, is the examination of how individuals, groups, and organizations make decisions regarding the selection, purchase, use, and disposal of goods, services, ideas, or experiences to fulfill their needs and desires.
Another definition has been defined by Schiffman, Hansen, &Kanuk, 2012 is that
“consumer behavior in seeking, purchasing, using, evaluating and disposing of products and services that they expect to satisfy their personal needs”.
Consumer behavior encompasses the entirety of decisions made by individuals regarding the acquisition, consumption, and disposal of goods, services, activities, experiences, people, and ideas over time, as defined by Hoyer & Macinnis (2010).
Some past studies such as Fierr 2009; Huang & Yi, 2010; Opoku& Abdul-
According to Muhmin (2010), home buyers can be viewed as consumers engaged in various activities related to housing products, including the selection, purchase, and utilization of these properties.
These studies investigated purchase decision-makingand the researcher also found out home buyers as consumers.
According to Schiffman's 2012 definition, consumer behavior encompasses the actions of individuals, groups, and organizations, involving not only the purchasing of products but also their use and disposal This behavior extends to services, ideas, and tangible goods, highlighting the comprehensive nature of consumer interactions in the marketplace.
A study by Kotler & Armstrong (2009) reveals that consumers' purchasing decisions are influenced by various factors, including what products they buy, their purchasing locations, timing, motivations behind their purchases, methods of buying, and the amounts spent.
Consumer behavior refers to the analysis of how individuals, groups, and organizations make decisions regarding the selection, purchase, usage, and disposal of goods, services, ideas, or experiences to fulfill their needs and desires.
Model of consumer behaViOT - - 7-5 cv ni 6
Consumer behavior models help explain why individuals choose to purchase specific goods or services, illustrating the underlying patterns of consumer actions A prominent example is the stimulus-response model, developed by Kotler & Keller in 2009 This model posits that marketing and other external stimuli enter a consumer's consciousness, interacting with their psychological processes and unique characteristics, ultimately influencing their decision-making and purchase choices.
The stimulus-response model is increasingly utilized by marketing managers to understand consumer behavior This framework provides insight into the mental processes that occur between a consumer's final purchase decision and the external marketing stimuli they encounter Key psychological processes, including motivation, perception, learning, and memory, along with consumer characteristics such as cultural, social, and personal factors, significantly influence consumer responses.
Figure 1-1 Model of consumer behavior behaviour
The Buying Decision Process Model consists of five key stages: problem recognition, information search, evaluation of alternatives, purchase decision, and post-purchase behavior.
The decision-making process in consumer behavior is typically divided into two main sections: the pre-purchase process and the post-purchase process The pre-purchase process encompasses the stages leading up to a purchase, including problem recognition, information search, and evaluation of alternatives In contrast, the post-purchase process involves the consumer's experiences and activities following the purchase, focusing on post-purchase actions and satisfaction.
The consumer decision-making process involves a series of interconnected steps that lead to selecting among various options Marketing managers aim to gain a comprehensive understanding of this process, which encompasses consumers' experiences in researching, choosing, utilizing, and ultimately disposing of products or services.
Marketing experts have developed a 'five-stage model' outlining the consumer purchase decision-making process, which includes problem recognition, information search, evaluation of alternatives, purchase decision, and post-purchase behavior However, in real-life scenarios, consumers may skip or reverse some of these stages This thesis aims to examine specific aspects of the five-stage model to test the proposed research hypotheses.
Figure 1-2 Five- stage purchase decision- making process
Problem Information Evaluation of Purchase Post-
Recognition Search Alternatives Decision Behavior
The problem recognition stage is the initial phase in the five-stage purchase decision-making process, where consumers identify a need or problem triggered by internal or external stimuli During this stage, individuals become aware of the gap between their desired state and their current situation, prompting them to seek solutions.
In the consumer decision-making process, problem recognition occurs when the desired state surpasses the actual state, prompting the potential acquisition and consumption of products or services If this recognition is absent, consumers may lack the motivation to progress to the subsequent pre-purchasing stages.
Difference batwean the consumar’s desirad and percsivad conditions
No difference Actual state exceeds dasirad state
No action Search decision initiated
In the past, there were some studies that have studied about the impact of market
The desired state often exceeds the actual state, influencing stimuli and consumers' problem recognition in home buyers' decision-making processes Research by Rahman (2010) on the Australian housing market and Fung, Jeng, and Liu (2010) on China’s housing sector indicates a strong correlation between economic growth and the housing market in both countries The recognition of a need for improved living conditions, coupled with rising housing prices, has motivated residents in Australia and China to invest in real estate.
Research by Fierro et al (2009) and various studies indicate that many home purchases are limited by the buyer's current income relative to housing prices If potential buyers lack sufficient funds to cover the minimum payment, they will not progress to the information search stage of the home buying process, despite acknowledging that their living conditions could improve in the future.
Once consumers identify their problems, they begin searching for information to alleviate uncertainty and perceived risks associated with making a purchasing decision This process involves recalling relevant information from memory to assess known solutions, comparing the attributes of each option, and ultimately selecting what they believe to be the best solution According to Schiffman et al (2012), this retrieval of information from personal memory is termed an internal search If consumers cannot find a suitable solution through this internal search, they must explore other avenues.
Customers often rely on their personal experiences and memories to gather internal information about products or services Additionally, they may conduct external searches to obtain further details and insights.
Before making a purchase decision, consumers must address their identified problems by researching relevant evaluative criteria and the features of potential solutions The information search stage concludes when consumers identify what they believe to be the best solution, illustrating the processes involved in consumer purchase decision-making.
Source: Adapted from Quester, Pettigrew, Hawkins 2011
Consumers gather information from various channels, including personal experiences, family and friends, independent sources like government agencies, marketing sources such as advertisements in newspapers and on television, and experiential sources like product trials The widespread use of the internet has significantly accelerated the flow of information between the market and consumers, shifting the information search process from offline to online platforms.
The next step in the consumer purchase process, following information search, is the evaluation and selection of alternatives This involves using evaluative criteria, which are the standards and specifications established to compare various products and brands, as defined by Blackwell et al (2006).
Major factors influencing consumer behavior - -¿- << <++++ 16
Professor Kotler and Keller's consumer behavior model (2009) identifies four psychological processes—motivation, perception, learning, and memory—that significantly influence consumer responses Additionally, consumer characteristics, shaped by cultural, social, and personal factors, play a crucial role in purchase behavior Research by Blackwell et al (2006) and Quester, Pettigrew, and Hawkins (2011) highlights that individual differences and environmental influences further affect consumer decision-making processes Figure 1-9 illustrates the key factors influencing consumer purchase behavior.
Demographics Products & services Personality andlifestvie
Intention, attitudes, Buying Decision Process
Other Stimuli Evaluation of alternatives
Technological influences Post-purchase behavior
Political —+ằ/| Culture, ethnicity, and social class Family and household Group and personal
Individual factors are the consumers’ psychological processes that affect consumer behaviour in acquiring, obtaining, consuming and disposing of products and services In the work of Blackwell, Miniard, et al., 2006;
Schiffman et al, 2012, individual influences comprise consumer demographics, personality, lifestyle, motivation, knowledge, intention, attitudes, beliefs and feelings.
A couple of main determinants of consumers’ demand for products or services are consumers’ personal characteristics which include their demographic, lifestyles and personalities.
“Demography: in his book “principles of marketing” Phillip Kotler defines demography as the study of human population in terms of size, density, location,
Understanding consumer behavior is essential, and demographic variables such as age, gender, and occupation play a crucial role in shaping purchasing decisions These measurable factors provide insights into consumer preferences and willingness to buy Market segmentation aims to address the diverse needs of different consumer groups by tailoring products accordingly Researchers often analyze various demographic characteristics to better comprehend the specific needs and desires of consumers within segmented markets, ultimately enhancing satisfaction and driving sales.
Personality refers to an individual's distinct and consistent reactions to various environmental stimuli, influencing how they engage with their surroundings According to Kotler & Keller (2009), personal traits are prevalent among individuals, making them valuable for marketers to understand and analyze consumer purchasing behaviors.
Personal values play a crucial role in shaping an individual's life and significantly influence consumer behavior, particularly in purchase decisions According to Blackwell, Souza, et al (2006), these values affect the need recognition stage and the evaluative criteria used by consumers In the context of housing decisions, research by Greene, Margarita, & Ortuzar, Juan De Dios (2002) highlights that home buyers' personal values directly impact their selection of property attributes.
A lifestyle encompasses an individual's way of living, including their spending habits, social activities, and the expression of interests and opinions (East et al., 2008) People frequently rely on their personal lifestyles to make sense of current events and to anticipate future occurrences.
A consumer’s purchase decision processes generally are appropriate with their lifestyle and are appropriate for the price level the consumer can afford (Kotler& Armstrong, 2009).
Motivation plays a crucial role in understanding consumer behavior, as it drives individuals to fulfill their physiological and psychological needs When a need arises, motivated consumers become eager to engage in the purchasing process, seeking diverse products or services that align with their unique needs This variation in consumer motivation influences how they evaluate and choose products, prompting marketers to analyze these motivations to better predict demand characteristics Understanding consumer motivation is essential for effective marketing strategies.
Knowledge refers to the information retained in an individual's memory that aids consumers in evaluating and choosing products or services (Schiffman et al., 2012) This consumer knowledge encompasses diverse information sources, including product attributes, associations, and insights related to the purchasing process, as well as how products or services can be effectively utilized.
5) Intention, attitudes, beliefs and feelings
The interplay of four key psychological factors significantly influences consumer behavior Initially, consumers assess their beliefs about a product or service, which shapes their attitude toward it This process culminates in a purchase decision, followed by the consumption experience Individual factors such as demographics, personality, lifestyle, motivation, knowledge, intention, attitudes, beliefs, and feelings all play a crucial role in shaping consumers' purchasing behaviors.
Environmental factors include culture, ethnicity, social class, family, household,group and personal influences.
1) Culture, ethnicity, and social class
Culture, as defined by Kotler and Armstrong (2009), encompasses the fundamental values, perceptions, desires, and behaviors acquired by individuals from their families, educational institutions, and society This cultural framework significantly influences each of the five stages of the purchasing process, including need recognition, information search, evaluation of alternatives, purchase decision, and post-purchase behavior.
Ethnicity encompasses the strengths and weaknesses individuals experience within their ethnic group, where shared knowledge and culture foster similar perceptions among members Distinct cultural backgrounds and lifestyles among different ethnic groups can significantly influence their consumer behaviors (Blackwell, Souza, et al., 2006).
Social classes are enduring divisions within society, characterized by members who share similar economic positions, wealth, status, values, lifestyles, interests, education, and behaviors Factors such as occupation, personal performance, interactions, possessions, value orientation, and class consciousness also play a crucial role in defining an individual's social class The primary dimensions of achievement-based status that influence social standing include education, occupational prestige, and income These distinctions among social classes lead to varying consumption behaviors and significantly impact the evaluation of alternatives during consumer purchase decision-making.
The family or household is the basic consumption unit for many consumer products or services, and consumer purchase decisions are significantly
Family members significantly influence the purchasing and consumption of products, with various demographic factors such as age, head of household, marital status, employment status, number of children, and family size impacting these decisions These factors shape the dynamics within families and households, ultimately affecting their buying choices According to Solomon (2009), each family member assumes distinct roles and exerts varying levels of influence throughout the purchase decision-making process.
According to Kolter and Keller (2009), reference groups are categorized into primary and secondary groups Primary groups, such as family, friends, neighbors, and co-workers, involve continuous and informal interactions In contrast, secondary groups consist of individuals connected through religious, professional, or trade union affiliations, characterized by more formal relationships that are less comprehensive and influential on thoughts and behaviors.
Individuals are often part of multiple groups, leading them to adopt the values, beliefs, and norms of those groups, which in turn influences their consumer behavior As noted by Blackwell et al (2006), two key personal factors that significantly impact individual behavior are word-of-mouth communication—informal exchanges of ideas and opinions between people—and the influence of leaders within these groups.
Factors affecting house purchase deciSIOn - 5c csxssxcsees 21 1:2 HOuUsingTHARK€EssssssasssenenseiiiiintiiiiELE0161118611131543583843515634851365581-861583410324%60368 22
When purchasing a house, buyers should evaluate several key factors, including the property's price, quality, and legal documentation, alongside their financial situation, such as monthly net income and potential for promotions The five primary considerations that influence a buyer's decision to purchase a home are the legal procedures involved, the quality of products and services, the property's location, its price, and the buyer's income.
Despite efforts by management bodies to facilitate house buyers, legal procedural barriers remain that hinder access to government credit support packages Although there have been modifications such as extended borrowing targets and reduced interest rates, the requirement to demonstrate current income continues to be a significant obstacle for buyers.
Product and service quality: The house qualities are tangible attributes such as structure, house design, number of bathrooms, bedrooms
When purchasing a house, the total cost is crucial for buyers, encompassing not only the purchase price but also ongoing expenses such as maintenance and lift fees Additionally, the price should reflect the property's value in relation to its location.
When purchasing a house, location plays a crucial role in the decision-making process Many buyers prioritize proximity to essential amenities such as schools, hospitals, and commercial centers, while others prefer to be near main roads or close to their workplace.
Financial situation: The buyer’s net income indicates their financial ability in covering all expenses they pay out to own and use the house.
Definition of housing market eee eee eeeseeeceeeteeeeeeeseeeseseseeceeeneees 22
The housing market, as defined by Jones and Watkins (2009), involves transactions between buyers and sellers, which can occur directly or through brokers Companies involved in housing ownership, management, and development have seen significant revenue growth Priemus (1984) further categorizes the housing market into three segments: the dwellings trading market, the rental housing market, and the housing services offered by rental suppliers, a framework widely accepted among scholars.
Figure 1-10 Composition of the housing market
Development of the global real estate market - ô+ << <2 23
The housing market is a vital segment of the real estate market, heavily impacted by its overall trends Gaining insights into the broader real estate market enhances our comprehension of the housing market dynamics.
The real estate market is defined as: “the interaction of individuals who exchange real property rights for other assets, such as money” (Kahr&Thomsett, 2005, p. 217).
Real estate markets can be defined by various factors such as property type, location, and income potential (Kahr & Thomsett, 2005) From 2004 to 2008, the global real estate industry experienced significant growth, achieving a total capitalization of US$501.60 billion, with the American and European markets valued at US$175.80 billion and US$180.40 billion, respectively, in 2008 The residential sector was particularly profitable, generating US$287.10 billion, which accounted for 57.20% of the industry's total value (Datamonitor, 2010) However, this period of prosperity ended with the collapse of America's housing bubble at the end of 2008, leading to widespread negative repercussions in the market.
The US housing market has seen a notable decline, which has adversely impacted global housing markets, particularly in Europe This downturn is reflected in various factors, including home valuations, the performance of residential builders, employment rates, and the availability of homes in retail outlets.
The real estate industry has evolved into a global marketplace, attracting a diverse array of investors, including domestic and foreign institutional and individual investors Over the past two decades, commercial real estate has increasingly drawn interest beyond national borders, with cross-border investments tripling to US$116 billion from 2002 to 2006, accounting for 20 percent of global property investments By the end of 2006, North America emerged as the leading destination for real estate investments, totaling US$216 billion, while the Asia-Pacific region experienced the fastest growth, with a 46 percent increase in investments, reaching US$68 billion.
2006) Worldwide, investors faced property decline risks which started at the end of 2008 As a result, the total global real estate investment fell to its lowest point
In 2009, global investment in the real estate industry was valued at US$209 billion However, a report by Jones Lang Lasalle and data from Datamonitor indicated a significant recovery in 2010, with the market experiencing an average growth rate of 35% over 2010 and 2011 Consequently, the real estate market reached approximately US$316 billion in 2010 and further increased to US$379 billion in 2011.