House purchase intention during pandemic COVID-19 in Surabaya, Indonesia

Abstract

PurposeSince the COVID-19 occurred, large-scale social restriction (Pembatasan Sosial Berskala Besar-PSBB) has taken place, and that has led family members to carry out their activities at home. This condition impacts both directly and indirectly the intention of house purchase, as a result of lifestyle changes during the pandemic. A house now serves as a residence, office, as well as school. This study aims to determine the influences of physical attributes, neighborhood preferences, financial concerns, financial risk preferences, health risk preferences, and COVID anxiety towards house purchase intention.Design/methodology/approachThis associative study was carried out from February to May 2021 in the residents of Surabaya aged 20–34 years old as prospective first-home buyers, with relatives at risk of contracting COVID-19 (belong in the susceptible group or live with a family member who is prone to the COVID-19 virus, including having a comorbidity, elderly (= 60 years old), having a low immune system or autoimmune disease, obese). Data were gathered using online questionnaires from which 226 respondents were acquired. Data were analyzed using the PLS-SEM 3.0 technique.FindingsThe results showed that physical attributes, neighborhood preferences, financial concerns, financial risk preferences, and COVID anxiety significantly influence house purchase intention. Furthermore, neighborhood preferences, financial risk preferences, and COVID anxiety as moderating variables also significantly influence house purchase intention.Practical implicationsThis study was carried out in Surabaya as the second-largest city after Jakarta with the highest COVID-19 mortality rate, which is useful for exploring the lifestyle changes and property demand as a result of the pandemic; Developers gain a business opportunity by offering properties that are multifunction and health-oriented.Originality/valueThe COVID-19 pandemic becomes a trigger for a change in the property market that needs to be studied further.