Term Paper on Consumer Behaviour

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Understanding Consumer Behavior for Purchase of Real Estate (Residential Property) Term Paper on Consumer Behavior

Submitted by Ms Kiran Joshi – EEPM-04-018

IIM KOZHIKODE

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Table of Contents

I. II. III. IV. V. VI. VII.

Introduction ............................................................................................................................. 3 Objective of the Paper .......................................................................................................... 3 Research Methodology ........................................................................................................ 3 Discussions and findings...................................................................................................... 4 Buying Decision Process Cycle ........................................................................................... 5 Conclusion ........................................................................................................................... 7 Limitation ............................................................................................................................. 8

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I. Introduction

Investment in real estate has seen a change in investors' mindset. Apart from owning a house, people are increasingly looking to buy a second property to earn some investment income out of the property Different people invest in a second property with different motives. For some, second home is to have a relaxing or Chilled out place away from the hustle and bustle of city life. Some people invest in a second home in order to earn rental income or additional income which adds up to their family total income. A customer opting for second home is primarily looking at an opportunity to get away from the day-today hectic city life and enjoy the calm, peaceful atmosphere within the comfort of their home. This means that while making the ultimate choice for first homes, most buyers invariably sacrifice comfort and natural ambiance in favor of daily commuting distances. Purchases for weekend homes, or vacation homes, however, are preferred in close-by to nature (like greenery, River bank or for some hill stations etc.) or other accessible locations with cordial surroundings. Indians who buy holiday homes tend to have higher disposable incomes and hail from the middle and higher class segments. This buyer segment is usually in the age bracket of 30- 45 years and these purchases are made either for investment or as weekend getaways. It is believed that the second home segment has been witnessing a growth of 70-80 per cent in 2012,(holidayhometimes.com) therefore consumers have started to believe that two homes are always better than one and that the second one should provide what the first one cannot.

II.

Objective of the Paper

The study thru this paper is to examine consumer home buying behavior from the consumer perspective. The purpose of this research is to:   To know the degree of importance of various factor which buyer consider while purchasing a second house. Elements that influence the real estate purchase behavior of consumers.

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Research Methodology

The methodology used for this study was obtained from depth Interview techniques where we probed the consumer with open ended questions to uncover information buried under the conscious mind. We selected few couples from various parts of Mumbai suburban area and ran a in-depth interview understanding their needs for second home and how their decision making process concluded. Interview was divided in three different sections. The first section covered the general information about responders, including age, gender, education level, income level, intention of house purchasing, purchase period and information search of real estate properties. The second part covered relating to the risk involved- Perceived Risk as there is large financial obligation. What was the most...
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