A comparative analysis of financial affordability in Islamic home financing instruments in Malaysia
Purpose – This study aims to compare and contrast the financial affordability of Islamic home financing instruments such as bay’ bithaman ajil and musharakah mutanaqisah (MM) offered by various home financing institutions in Malaysia. Design/methodology/approach – Mathematical simulations were ca...
| Main Authors: | , |
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| Format: | Article |
| Language: | English English English |
| Published: |
Emerald Publishing Limited
2019
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| Subjects: | |
| Online Access: | http://irep.iium.edu.my/72407/ http://irep.iium.edu.my/72407/12/72407_A%20comparative%20analysis%20of%20financial%20affordability_article.pdf http://irep.iium.edu.my/72407/7/72407_A%20comparative%20analysis%20of%20financial%20affordability%20in%20Islamic%20home%20financing%20instrumentsin%20Malaysia_Scopus.pdf http://irep.iium.edu.my/72407/13/72407_A%20comparative%20analysis%20of%20financial%20affordability_wos.pdf |
| _version_ | 1848787609745096704 |
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| author | Md Zabri, Mohd Zaidi Haron, Razali |
| author_facet | Md Zabri, Mohd Zaidi Haron, Razali |
| author_sort | Md Zabri, Mohd Zaidi |
| building | IIUM Repository |
| collection | Online Access |
| description | Purpose – This study aims to compare and contrast the financial affordability of Islamic home financing
instruments such as bay’ bithaman ajil and musharakah mutanaqisah (MM) offered by various home
financing institutions in Malaysia.
Design/methodology/approach – Mathematical simulations were carried out in examining the
financial affordability (or lack thereof) of various Islamic home financing by both Islamic commercial banks
(ICB) and financial cooperatives (FC).
Findings – This study has shown that MM by FC is a workable, more financially affordable option to
potential homeowners. Unlike ICB, MM by FC uses rental rates as a benchmarking tool because of its inherent
nature of flexibility.
Research limitations/implications – MM by FC has the potential to reduce the cost of home
acquisition (purchase affordability) and the amount of monthly installments (repayment affordability) of
homeowners in Malaysia.
Originality/value – This study shows the financial implication of unaffordable Islamic home financing
instruments may have on the Malaysian households, which were derived from using official data from
various government agencies. |
| first_indexed | 2025-11-14T17:27:39Z |
| format | Article |
| id | iium-72407 |
| institution | International Islamic University Malaysia |
| institution_category | Local University |
| language | English English English |
| last_indexed | 2025-11-14T17:27:39Z |
| publishDate | 2019 |
| publisher | Emerald Publishing Limited |
| recordtype | eprints |
| repository_type | Digital Repository |
| spelling | iium-724072020-04-11T14:51:42Z http://irep.iium.edu.my/72407/ A comparative analysis of financial affordability in Islamic home financing instruments in Malaysia Md Zabri, Mohd Zaidi Haron, Razali HB126.4 Islamic Economics HG Finance HG3368 Islamic Banking and Finance Purpose – This study aims to compare and contrast the financial affordability of Islamic home financing instruments such as bay’ bithaman ajil and musharakah mutanaqisah (MM) offered by various home financing institutions in Malaysia. Design/methodology/approach – Mathematical simulations were carried out in examining the financial affordability (or lack thereof) of various Islamic home financing by both Islamic commercial banks (ICB) and financial cooperatives (FC). Findings – This study has shown that MM by FC is a workable, more financially affordable option to potential homeowners. Unlike ICB, MM by FC uses rental rates as a benchmarking tool because of its inherent nature of flexibility. Research limitations/implications – MM by FC has the potential to reduce the cost of home acquisition (purchase affordability) and the amount of monthly installments (repayment affordability) of homeowners in Malaysia. Originality/value – This study shows the financial implication of unaffordable Islamic home financing instruments may have on the Malaysian households, which were derived from using official data from various government agencies. Emerald Publishing Limited 2019-05-29 Article PeerReviewed application/pdf en http://irep.iium.edu.my/72407/12/72407_A%20comparative%20analysis%20of%20financial%20affordability_article.pdf application/pdf en http://irep.iium.edu.my/72407/7/72407_A%20comparative%20analysis%20of%20financial%20affordability%20in%20Islamic%20home%20financing%20instrumentsin%20Malaysia_Scopus.pdf application/pdf en http://irep.iium.edu.my/72407/13/72407_A%20comparative%20analysis%20of%20financial%20affordability_wos.pdf Md Zabri, Mohd Zaidi and Haron, Razali (2019) A comparative analysis of financial affordability in Islamic home financing instruments in Malaysia. International Journal of Housing Markets and Analysis. pp. 1-20. ISSN 1753-8270 https://doi.org/10.1108/IJHMA-11-2018-0090 |
| spellingShingle | HB126.4 Islamic Economics HG Finance HG3368 Islamic Banking and Finance Md Zabri, Mohd Zaidi Haron, Razali A comparative analysis of financial affordability in Islamic home financing instruments in Malaysia |
| title | A comparative analysis of financial affordability in Islamic home financing instruments in Malaysia |
| title_full | A comparative analysis of financial affordability in Islamic home financing instruments in Malaysia |
| title_fullStr | A comparative analysis of financial affordability in Islamic home financing instruments in Malaysia |
| title_full_unstemmed | A comparative analysis of financial affordability in Islamic home financing instruments in Malaysia |
| title_short | A comparative analysis of financial affordability in Islamic home financing instruments in Malaysia |
| title_sort | comparative analysis of financial affordability in islamic home financing instruments in malaysia |
| topic | HB126.4 Islamic Economics HG Finance HG3368 Islamic Banking and Finance |
| url | http://irep.iium.edu.my/72407/ http://irep.iium.edu.my/72407/ http://irep.iium.edu.my/72407/12/72407_A%20comparative%20analysis%20of%20financial%20affordability_article.pdf http://irep.iium.edu.my/72407/7/72407_A%20comparative%20analysis%20of%20financial%20affordability%20in%20Islamic%20home%20financing%20instrumentsin%20Malaysia_Scopus.pdf http://irep.iium.edu.my/72407/13/72407_A%20comparative%20analysis%20of%20financial%20affordability_wos.pdf |