Under invoicing in the residential real estate market in Pakistan
In this paper the meaning of “under invoicing in a real estate market” signifies that the market value of real property exceeds its record value appearing in government documentation. The purpose of this study is to identify the level of under invoicing and determine the factors that affect the unde...
| Main Authors: | , , |
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| Format: | Article |
| Language: | English |
| Published: |
Vilnius Gediminas Technical University
2021-03-01
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| Series: | International Journal of Strategic Property Management |
| Subjects: | |
| Online Access: | https://journals.vgtu.lt/index.php/IJSPM/article/view/14337 |
| _version_ | 1818903255902584832 |
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| author | Abdul Wahid Edmund H. Mantell Muhammad Zubair Mumtaz |
| author_facet | Abdul Wahid Edmund H. Mantell Muhammad Zubair Mumtaz |
| author_sort | Abdul Wahid |
| collection | DOAJ |
| description | In this paper the meaning of “under invoicing in a real estate market” signifies that the market value of real property exceeds its record value appearing in government documentation. The purpose of this study is to identify the level of under invoicing and determine the factors that affect the under invoicing in real estate markets in Pakistan. We apply OLS and Extreme Bounds Analysis techniques to test our propositions. The statistical sample consists of 338 real estate contracts. We find that under invoicing is determined by a multiplicity of factor. These include: the capital gains tax rate, the measurable amount of corruption in the economy, the risk-free rate, a buyer’s profession, the reputation of the local housing authority, and the degree of disequilibria in regional real estate markets. Our findings are consistent with four distinct hypotheses: (a) tax evasion hypothesis, (b) widening gap hypothesis, (c) a corruption hypothesis and (d) a signaling hypothesis. The evidence suggests that higher rates of taxation and a larger statistical incidence of corruption in markets tend to be associated with a greater probability of under-invoicing. The findings of the study have practical implications for those investors who are interested in real estate markets of emerging and developing economies.
First published online 05 March 2021 |
| first_indexed | 2024-12-19T20:48:39Z |
| format | Article |
| id | doaj.art-fc9c01a18ab143bebddcc44749ea468f |
| institution | Directory Open Access Journal |
| issn | 1648-715X 1648-9179 |
| language | English |
| last_indexed | 2024-12-19T20:48:39Z |
| publishDate | 2021-03-01 |
| publisher | Vilnius Gediminas Technical University |
| record_format | Article |
| series | International Journal of Strategic Property Management |
| spelling | doaj.art-fc9c01a18ab143bebddcc44749ea468f2022-12-21T20:06:10ZengVilnius Gediminas Technical UniversityInternational Journal of Strategic Property Management1648-715X1648-91792021-03-0125319020310.3846/ijspm.2021.1433714337Under invoicing in the residential real estate market in PakistanAbdul Wahid0Edmund H. Mantell1Muhammad Zubair Mumtaz2NUML School of Business, National University of Modern Languages (NUML), Islamabad, PakistanLubin School of Business, Pace University, 1 Pace Plaza, NY 10038 New York, USASchool of Social Sciences and Humanities (S3H), National University of Science and Technology (NUST), Islamabad, PakistanIn this paper the meaning of “under invoicing in a real estate market” signifies that the market value of real property exceeds its record value appearing in government documentation. The purpose of this study is to identify the level of under invoicing and determine the factors that affect the under invoicing in real estate markets in Pakistan. We apply OLS and Extreme Bounds Analysis techniques to test our propositions. The statistical sample consists of 338 real estate contracts. We find that under invoicing is determined by a multiplicity of factor. These include: the capital gains tax rate, the measurable amount of corruption in the economy, the risk-free rate, a buyer’s profession, the reputation of the local housing authority, and the degree of disequilibria in regional real estate markets. Our findings are consistent with four distinct hypotheses: (a) tax evasion hypothesis, (b) widening gap hypothesis, (c) a corruption hypothesis and (d) a signaling hypothesis. The evidence suggests that higher rates of taxation and a larger statistical incidence of corruption in markets tend to be associated with a greater probability of under-invoicing. The findings of the study have practical implications for those investors who are interested in real estate markets of emerging and developing economies. First published online 05 March 2021https://journals.vgtu.lt/index.php/IJSPM/article/view/14337under-invoicingreal estate markettax evasionblack moneywidening gapextreme bounds analysis |
| spellingShingle | Abdul Wahid Edmund H. Mantell Muhammad Zubair Mumtaz Under invoicing in the residential real estate market in Pakistan International Journal of Strategic Property Management under-invoicing real estate market tax evasion black money widening gap extreme bounds analysis |
| title | Under invoicing in the residential real estate market in Pakistan |
| title_full | Under invoicing in the residential real estate market in Pakistan |
| title_fullStr | Under invoicing in the residential real estate market in Pakistan |
| title_full_unstemmed | Under invoicing in the residential real estate market in Pakistan |
| title_short | Under invoicing in the residential real estate market in Pakistan |
| title_sort | under invoicing in the residential real estate market in pakistan |
| topic | under-invoicing real estate market tax evasion black money widening gap extreme bounds analysis |
| url | https://journals.vgtu.lt/index.php/IJSPM/article/view/14337 |
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