Islamic Finance and Shariah‐Compliant Real Estate Investment

Parsa, Ali; Muwlazadeh, M

doi:10.1002/9781444315301.ch10

Cited by 1 publication

(1 citation statement)

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“…Therefore, to mitigate from those sudden increase in real estate price and to avoid from fluctuate in interest rate due to asset price bubbles, we suggesting that the authorities should consider to enhance the role of financial institutions either Islamic nor conventional in providing a stable rate and always ensuring the conduct of Islamic financial system following the Shariah guidelines. For instances, a few studies on Islamic financing suggest Islamic commercial real estate financing to use Sukuk (Parsa & Muwlazadeh, 2013); rental rate as the pricing of Islamic home financing (Yusof, Kassim, Majid, & Hamid, 2011).…”

Section: Discussionmentioning

confidence: 99%

Islamic Financial Institutions and Real Estate Cycle

Harun

Wahab

Yusof

2018

IPJAF

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The role of Islamic financial intuitions is essential in providing Islamic financing specifically to investors and stakeholders to invest in real estate. Therefore, understanding the link of the real estate cycle to the financial institutions is crucial. This is because the real estate cycle is one of the critical elements that will affect financing decisions and strategies of the banking sectors. Hence, this paper employed meta-analysis which aims (1) to systematically review survey the growing literature on real estate cycle and its links to the financial institutions; (2) to highlight possible cross-country trend analysis financial strategy among investors in dealing in with the real estate cycle. The results of the study suggest that during the peak cycle or period of crisis, most investors are risk-averse and increase the risk to the financing of real estate as well. This real estate cycle that occurs almost every 10 years in conventional real estate sectors also give some consequences to the Islamic financial institutions. This paper suggests to investors to understand the real estate cycle and its impact on Islamic financial institutions.

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Section: Discussionmentioning

confidence: 99%