Abstract
Defaults in residential mortgages could be very costly and hazardous to market stability. This paper sets out to inform homebuyers, lenders and policy makers of the determinants of default, and constructs a mortgage default model to assist them in making mortgage applications, advancing loans, or implementing policies to maintain market stability. Residential default behaviour from 1998 to 2007 is studied and a model is constructed by means of Autoregressive Multiple Linear Regression. The results show that the lag term of default rate, gross mortgage rate, current loan-to-value ratio, change in debt-to-income ratio and Consumer Price Index are positively correlated with default rate; however, property price appreciation and change in the Hang Seng Index have a negative relationship with default rate. © 2010 Taylor & Francis.
| Original language | English |
|---|---|
| Pages (from-to) | 647-669 |
| Journal | Housing Studies |
| Volume | 25 |
| Issue number | 5 |
| DOIs | |
| Publication status | Published - 2010 |
| Externally published | Yes |
Bibliographical note
Publication details (e.g. title, author(s), publication statuses and dates) are captured on an “AS IS” and “AS AVAILABLE” basis at the time of record harvesting from the data source. Suggestions for further amendments or supplementary information can be sent to [email protected].UN SDGs
This output contributes to the following UN Sustainable Development Goals (SDGs)
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SDG 11 Sustainable Cities and Communities
Research Keywords
- Autoregressive Multiple Linear Regression
- Default
- Hong Kong
- Housing market
- Residential mortgage
Policy Impact
- Cited in Policy Documents
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