Does hedonism influence real estate investment decisions? The moderating role of financial self-efficacy

Figures & data

Figure 1. The hypothesized Research Model with moderating effect.

Table 1. List of constructs with its items

Construct	Item Measurement	Item Code	Reference
Real estate investment decision (REID)	“When making a real estate investment decision, I trust my inner feelings and reactions.”	REID1	Wangzhou et al. (2021)
	“I generally make investments in real estate that feel right to me.”	REID2
	“In making a real estate investment decision, it is more important for me to feel the investment is right than have a rational reason for it.”	REID3
	“I rely on my intuition, when making real estate investment decisions.”	REID4
	“My real estate investment decision making requires careful thought.”	REID5
Hedonism (HED)	Exciting life	HED1	Singla and Hiray (2019)
	Happiness	HED2
	Comfortable life	HED3
	Social recognition	HED4
	Pleasure	HED5
Financial Self-efficacy (FSS)	“It is hard to stick to my spending plan when unexpected expenses arise.”	FSS1	Lown (2011).
	“It is challenging to make progress toward my financial goals.”	FSS2
	“When unexpected expenses occur, I usually have to use credit.”	FSS3
	“When faced with a financial challenge, I have a hard time figuring out a solution.”	FSS4
	“I lack confidence in my ability to manage my finances.”	FSS5
	“I worry about running out of money in retirement.”	FSS6

Table 2. Investors’ Socio demographic profiling

Demographic Profile	Occurrence	Percentage
Age (in years)
20–30	66	18
31–40	104	28
41–50	96	26
51–60	74	20
Above 60	35	9
Gender
Male	246	65.6
Female	129	34.4
Occupation
Business	71	19
Government sector employee	95	25
Private sector employee	80	21
Retired	61	16
Others	68	18
Income
less than 50,000	25	7
50001–100000	43	11
100001–150000	59	16
150001–200000	74	20
Above 200,000	174	46

Table 3. Measurement model assessment

Construct & Item	Factor loadings	CA	rho_A	CR	AVE	VIF
Real estate investment decision (REID)		0.907	0.908	0.931	0.729	2.497
REID1	0.849
REID2	0.853
REID3	0.861
REID4	0.876
REID5	0.83
Hedonism (HED)		0.914	0.915	0.936	0.744	2.994
HED1	0.853
HED2	0.844
HED3	0.868
HED4	0.882
HED5	0.866
Financialself-efficacy(FSS)		0.926	0.927	0.942	0.73	3.11
FSS1	0.859
FSS2	0.838
FSS3	0.852
FSS4	0.865
FSS5	0.84
FSS6	0.871
Age	1	1	1	1	1	-
Income	1	1	1	1	1	-

Note: CA- Cronbach’s Alpha; CR- Composite Reliability; AVE-Average Variance Expected;

VIF- Variance inflation factor.

Source: Authors’ calculation

Table 4. Discriminant validity

Construct	Financial self-efficacy	Hedonism	Real estate investment decision
Financial self efficacy (FSS)	0.853
Hedonism (HED)	0.716	0.863
Real estate investment decision (REID)	0.650	0.703	0.854

Note(s): Bold text indicates square root of AVE.

Source: Calculation by the Author

Table 5. Cross loading Tabulation

Construct	Items	FSS	HED	REID	Age	Income
Financial self-efficacy (FSS)	FS1	0.859	0.84	0.572	0.458	0.523
	FS2	0.838	0.784	0.563	0.427	0.47
	FS3	0.852	0.83	0.557	0.516	0.5
	FS4	0.865	0.74	0.58	0.523	0.567
	FS5	0.84	0.701	0.551	0.453	0.506
	FS6	0.871	0.732	0.5	0.426	0.481
Hedonism (HED)	HED1	0.697	0.853	0.631	0.519	0.555
	HED2	0.712	0.844	0.64	0.522	0.542
	HED3	0.852	0.868	0.557	0.516	0.5
	HED4	0.845	0.882	0.62	0.497	0.536
	HED5	0.861	0.866	0.575	0.46	0.525
Real estate Investment decision (REID)	REID1	0.545	0.608	0.849	0.71	0.682
	REID2	0.578	0.608	0.853	0.67	0.618
	REID3	0.57	0.611	0.861	0.639	0.657
	REID4	0.546	0.607	0.876	0.678	0.668
	REID5	0.539	0.568	0.83	0.669	0.69
Age	Age	0.548	0.584	0.789	1	0.677
Income	Income	0.596	0.618	0.777	0.677	1

Source: Authors’ Calculation

Table 6. Evaluation of structural models

Hypothesis	β coefficient	Standard Deviation	T Statistics	r^2	f^2
HED→REID (H1)	0.215	0.104	2.064**	0.56	0.037

Note(s): ** represents 0.05 level of significance

Source: Authors’ calculation

Figure 2. Structural model.

Table 7. Moderation effect

Hypothesis	β coefficient	Standard Deviation	T Statistics
FSS*HED → REID (H2)	−0.153	0.059	2.587**

**represents 0.05 level of significance.

Source: Authors’ calculation

Table 8. Control variable Effect

Variable	β coefficient	Standard Deviation	T Statistics
Age → REID	0.39	0.044	8.840***
Income → REID	0.32	0.052	5.995***

Note(S): *** represents 0.01 level of significance.

Source: Authors’ calculation

Table 9. Coefficient of determination (R-Square)

Dependent Variable	R square	Threshold Value	Model Fit decision
REID	0.56	r^2< 0.25 - Very weak 0.25 ≤ r^2 < 0.50 - Weak 0.50 ≤ r^2 < 0.75 - Moderate 0.25 ≤ r^2 < 0.50 -Strong	Moderate.

Source: Authors’ calculation

Wangzhou, K., Khan, M., Hussain, S., Ishfaq, M., & Farooqi, R. (2021). Effect of regret aversion and information cascade on investment decisions in the real estate sector: The mediating role of risk perception and the moderating effect of financial literacy. Frontiers in Psychology, 12(October), 1–15. https://doi.org/10.3389/fpsyg.2021.736753

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Singla, H. K., & Hiray, A. (2019). Evaluating the impact of hedonism on investment choices in India. Managerial Finance, 45(12), 1526–1541. https://doi.org/10.1108/MF-07-2019-0324

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Lown, J. M. (2011). 2011 oustanding AFCPE® Conference paper: Development and validation of a financial self-efficacy scale. Journal of Financial Counseling & Planning, 22(2), 54–63.

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