WILLINGNESS AND ELIGIBILITY TO MORTGAGE FINANCING IN UASIN GISHU COUNTY, KENYA: APPLICATION OF DOUBLE HURDLE MODEL
Keywords:
Mortgage financing, willingness, eligibility, double hurdle model, Uasin Gishu, KenyaAbstract
Mortgage financing plays a significant role in enabling people to be real estate property owners and or hom
eowners. Despite its significance, past statistics indicated that very few people accessed mortgage finance in
Kenya. Previous research indicated that at best only 3% of households in urban areas in Kenya were eligible for
mortgage financing. The purpose of this study was to investigate the factors that influence willingness to par
ticipate in mortgage financing and eligibility to mortgage financing in Uasin Gishu County, Kenya. The study
sought to: determine the role of demographic factors, socio-economic variables and financial variables on will
ingness and eligibility to mortgage financing. The study adopted explanatory research design. The target popula
tion was obtained by visiting all financial institutions licensed by Central Bank of Kenya offering mortgages in
Uasin Gishu County. Purposive and simple random sampling techniques were used to obtain 749 respondents
for the study distributed proportionately to the 16 financial institutions in Uasin Gishu County. The study ad
ministered structured questionnaires individually to all respondents and analyzed using descriptive and infer
ential statistics. Findings were presented in form of tables, cumulative frequency counts, percentages, graphs
and charts. A Double Hurdle Model was employed using data collected on the assumption that willingness and
eligibility to mortgage financing by respondents were two independent decisions and were influenced by the
same decision factors. The results showed that the age, rental income, tax benefit, income level, loan repayment
period and lending interest rate significantly influenced the willingness to participate in mortgage financing by
the respondents. The results also showed that age and income level of the respondents significantly determined
the eligibility to mortgage financing.
