Islamic home financing instruments in Malaysia: the emerging issue of financial (Un)affordability

This study compares and contrasts Islamic home financing instruments such as bay bithaman ajil and musharakah mutanaqisah (MM) by Islamic commercial banks, government-owned home financing institution and financial cooperative. Mathematical simulations were carried out in examining the purchase- and...

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Main Authors:	Md Zabri, Mohd Zaidi, Haron, Razali
Format:	Conference or Workshop Item
Language:	English English
Published:	2018
Subjects:	HG1501 Banking HG3368 Islamic Banking and Finance
Online Access:	http://irep.iium.edu.my/70254/ http://irep.iium.edu.my/70254/ http://irep.iium.edu.my/70254/1/70254%20-%20Islamic%20Home%20Financing%20Instruments%20in%20Malaysia.pdf http://irep.iium.edu.my/70254/2/70254%20-%20programme%20book.pdf

id	iium-70254
recordtype	eprints
spelling	iium-702542019-02-13T07:45:15Z http://irep.iium.edu.my/70254/ Islamic home financing instruments in Malaysia: the emerging issue of financial (Un)affordability Md Zabri, Mohd Zaidi Haron, Razali HG1501 Banking HG3368 Islamic Banking and Finance This study compares and contrasts Islamic home financing instruments such as bay bithaman ajil and musharakah mutanaqisah (MM) by Islamic commercial banks, government-owned home financing institution and financial cooperative. Mathematical simulations were carried out in examining the purchase- and repayment-affordability of Islamic home financing instruments by the above-mentioned providers. We have shown that Islamic home financing instruments by Islamic commercial banks are an unaffordable option for most Malaysians, even vis-à-vis the conventional home loan. Although government-owned home financing institution provides the cheapest option for homeowners, it is, however, restricted to civil servants. MM by the financial cooperative, on the other hand, is a workable, more financially affordable option to potential homeowners. The reason for this is that, unlike Islamic commercial banks, MM uses rental rates as a benchmarking tool which is more flexible as well as more responsive to its member-customers’ specificities of localities and types of homes. As a result, it may reduce the cost of home acquisition (purchase-affordability) and the amount of monthly instalments (repayment-affordability) by homeowners in Malaysia. 2018-11-14 Conference or Workshop Item PeerReviewed application/pdf en http://irep.iium.edu.my/70254/1/70254%20-%20Islamic%20Home%20Financing%20Instruments%20in%20Malaysia.pdf application/pdf en http://irep.iium.edu.my/70254/2/70254%20-%20programme%20book.pdf Md Zabri, Mohd Zaidi and Haron, Razali (2018) Islamic home financing instruments in Malaysia: the emerging issue of financial (Un)affordability. In: 6th ASEAN Universities International Conference on Islamic Finance (AICIF), 14-15 November 2018, Makati, Manila. (Unpublished) http://aicif.net/
repository_type	Digital Repository
institution_category	Local University
institution	International Islamic University Malaysia
building	IIUM Repository
collection	Online Access
language	English English
topic	HG1501 Banking HG3368 Islamic Banking and Finance
spellingShingle	HG1501 Banking HG3368 Islamic Banking and Finance Md Zabri, Mohd Zaidi Haron, Razali Islamic home financing instruments in Malaysia: the emerging issue of financial (Un)affordability
description	This study compares and contrasts Islamic home financing instruments such as bay bithaman ajil and musharakah mutanaqisah (MM) by Islamic commercial banks, government-owned home financing institution and financial cooperative. Mathematical simulations were carried out in examining the purchase- and repayment-affordability of Islamic home financing instruments by the above-mentioned providers. We have shown that Islamic home financing instruments by Islamic commercial banks are an unaffordable option for most Malaysians, even vis-à-vis the conventional home loan. Although government-owned home financing institution provides the cheapest option for homeowners, it is, however, restricted to civil servants. MM by the financial cooperative, on the other hand, is a workable, more financially affordable option to potential homeowners. The reason for this is that, unlike Islamic commercial banks, MM uses rental rates as a benchmarking tool which is more flexible as well as more responsive to its member-customers’ specificities of localities and types of homes. As a result, it may reduce the cost of home acquisition (purchase-affordability) and the amount of monthly instalments (repayment-affordability) by homeowners in Malaysia.
format	Conference or Workshop Item
author	Md Zabri, Mohd Zaidi Haron, Razali
author_facet	Md Zabri, Mohd Zaidi Haron, Razali
author_sort	Md Zabri, Mohd Zaidi
title	Islamic home financing instruments in Malaysia: the emerging issue of financial (Un)affordability
title_short	Islamic home financing instruments in Malaysia: the emerging issue of financial (Un)affordability
title_full	Islamic home financing instruments in Malaysia: the emerging issue of financial (Un)affordability
title_fullStr	Islamic home financing instruments in Malaysia: the emerging issue of financial (Un)affordability
title_full_unstemmed	Islamic home financing instruments in Malaysia: the emerging issue of financial (Un)affordability
title_sort	islamic home financing instruments in malaysia: the emerging issue of financial (un)affordability
publishDate	2018
url	http://irep.iium.edu.my/70254/ http://irep.iium.edu.my/70254/ http://irep.iium.edu.my/70254/1/70254%20-%20Islamic%20Home%20Financing%20Instruments%20in%20Malaysia.pdf http://irep.iium.edu.my/70254/2/70254%20-%20programme%20book.pdf
first_indexed	2023-09-18T21:39:44Z
last_indexed	2023-09-18T21:39:44Z
_version_	1777413059538583552

Islamic home financing instruments in Malaysia: the emerging issue of financial (Un)affordability

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