Description
In recent times, Bangladesh has faced serious housing problems, especially for people who live in cities.
In response, this study examines the relationship between housing expenses, affordability, service
quality, hygienic conditions, and community attachment and residents' satisfaction, respectively. A
questionnaire-based survey was carried out with customers in the major parts of Dhaka, Bangladesh. In
addition to descriptive analysis, other statistical analyses, such as exploratory factor analysis, confirmatory
factor analysis, and a structural equation modeling approach were used to test the hypotheses.
The findings reveal that there is a strong relationship between services provided by the private companies
and residents' satisfaction, with hygienic conditions playing a major role. This study also confirms
a significant relationship between housing expenses and residents' satisfaction when affordability plays a
mediating role. This study is the first of its kind, to the best of our knowledge, conducted on the customers
of the Bangladeshi housing industry. The contribution of this study is the construction of a
research theoretical framework that potentially highlights the perceived satisfaction or dissatisfaction of
residents with the facilities provided by the private apartment owners in Bangladesh.
Original article
Exploring residents' satisfaction of facilities provided by private apartment
companies
Muhammad Sabbir Rahman
a, *
, Bashir Hussain
b
, A.N.M. Meshquat Uddin
b
, Nazrul Islam
c
a
Faculty of Languages and Management, International Islamic University Malaysia (IIUM), Jalan Gombak, Selangor Darul Ehsan, Kuala Lumpur, Malaysia
b
School of Business, North South University (NSU), Dhaka, Bangladesh
c
School of Business, Eastern University (EU), Dhaka, Bangladesh
a r t i c l e i n f o
Article history:
Received 8 February 2014
Accepted 22 September 2014
Available online 4 April 2015
Keywords:
Affordability
Community attachment
Housing expenses
Hygienic conditions
Residents satisfaction
a b s t r a c t
In recent times, Bangladesh has faced serious housing problems, especially for people who live in cities.
In response, this study examines the relationship between housing expenses, affordability, service
quality, hygienic conditions, and community attachment and residents' satisfaction, respectively. A
questionnaire-based survey was carried out with customers in the major parts of Dhaka, Bangladesh. In
addition to descriptive analysis, other statistical analyses, such as exploratory factor analysis, con?r-
matory factor analysis, and a structural equation modeling approach were used to test the hypotheses.
The ?ndings reveal that there is a strong relationship between services provided by the private com-
panies and residents' satisfaction, with hygienic conditions playing a major role. This study also con?rms
a signi?cant relationship between housing expenses and residents' satisfaction when affordability plays a
mediating role. This study is the ?rst of its kind, to the best of our knowledge, conducted on the cus-
tomers of the Bangladeshi housing industry. The contribution of this study is the construction of a
research theoretical framework that potentially highlights the perceived satisfaction or dissatisfaction of
residents with the facilities provided by the private apartment owners in Bangladesh.
© 2015, College of Management, National Cheng Kung University. Production and hosting by Elsevier
Taiwan LLC. All rights reserved.
1. Introduction
The role of housing is part of the social environment rather than
the personal environment. That is why the reputation of an area and
the people living in that area are stronger predictors of residents'
psychosocial bene?ts, such as autonomy, comfort, and status
(Dupuis & Thorns, 1998; Kearns, Hiscock, Ellaway, & Macintyre,
2000). In addition, Shaw (2004) and Wilkinson (1999) argued that
inadequate housing facilities highly in?uenced the poor health of
the residents. Housing facilities also have a positive impact on the
mental health of residents (Thomson & Petticrew, 2005). Studies by
the Commission on Social Determinants of Health (2008) and
Scottish Government (2008) revealed that neighborhood conditions
could also have an impact on the quality of life of the residents.
Evans, Wells, and Moch (2003) and Evans (2003) suggested that
housing design (e.g., dwelling type and street layout) could also
affect the psychological perspective of residents, such as mental
health. Having less control over the shared space and the lack of
social interaction between residents who are living in high-rise
buildings, where housing units comprise a large number of sepa-
rate units, may have an adverse impact on the residents' psycho-
logical perspective, especially mental health (Evans, 2003; Evans
et al., 2003; Weich et al., 2002). Even large blocks of ?ats some-
times discourage social interaction between the neighbors (Day,
2008). A study of residents in the west of Scotland indicated that
those who live in a house as opposed to a ?at, and those who have
access to a garden have more signi?cant psychosocial bene?ts and
greater autonomy over their home (Hiscock, Kearns, Macintyre, &
Ellaway, 2001; Kearns et al., 2000). In fact, the surrounding envi-
ronment of a residential area must include certain characteristics,
such as visual amenity, access to green space, and spaces that permit
social interaction, which ultimately positively affect the well-being
and quality of life of the residents (Cattell, Dines, Gesler, & Curtis,
* Corresponding author. Faculty of Languages and Management, International
Islamic University Malaysia (IIUM), P.O. Box 10, Jalan Gombak, Selangor Darul
Ehsan, 50728 Kuala Lumpur, Malaysia.
E-mail addresses: [email protected], [email protected]
(M.S. Rahman).
Peer review under responsibility of College of Management, National Cheng
Kung University.
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Asia Paci?c Management Review 20 (2015) 130e140
2008; Day, 2008; O'Campo, Salmon, & Burke, 2008; Thomson,
Kearns, & Petticrew, 2003; Warr, Tacticos, Kelaher, & Klein, 2007).
At present, citizens of Bangladesh are facing serious housing
problems, especially those people living inthe cityarea. This is due to
the low rate of gross domestic product, population densities, high
population growth rate in urban areas, and poor standard of living
conditions [Asian Development Bank (ADB), 1995]. According to a
report from the ADB (1995), the situation has not yet improved
signi?cantlyover thepast decade. Inrecent times, a number of private
companies have started offering low-cost housing facilities to meet
the needs of the existing residents. However, very little empirical
analysis has been carried out on housing conditions in Bangladesh.
Thus, there is an urgent need for high-quality empirical research on
resident's satisfaction concerning housing facilities provided by the
private companies in a least developing country like Bangladesh.
Dhaka was chosen as the study site. According to one estimate,
about 320,000 migrants enter Dhaka annually (Islam, Huda, &
Narayan, 1997). This situation causes tremendous stress on the fa-
cilities, which subsequently have a negative impact on the indi-
vidual resident's satisfaction (Uddin et al., 2009). Dhaka is one of
the dynamic cities in Bangladesh that attracts almost
300,000e400,000 new migrants each year. Most migrants come
from rural areas in search of opportunities. The lineaments of the
city include extremely high land costs, very high rental price of
apartments, high apartment purchase price, poor quality of housing
facilities, traf?c congestion, water de?cits, inadequate sanitation
and drainage facilities, irregular electric supply, and increasing air
pollution. However, reports indicate that population of Dhaka is
expected to rise to approximately 20 million in 2020, making it the
world's third greatest metropolis (The World Bank Of?ce, Dhaka,
2007). Given this rapid increase, the shortage of suf?cient infra-
structure and services, and growing social and environmental
problems necessitate an urgent attention to exploring the resi-
dents' satisfaction with facilities provided by the private apartment
companies. To evaluate the magnitude of these problems, this
research focuses on the residents of Dhaka city. We expect that this
effort will lead to a fuller understanding of residents' satisfaction of
their current living place, thus providing fruitful information for the
policy-makers to spot the priorities of residents' satisfaction with
facilities provided by the private apartment companies in
Bangladesh. As a consequence, this research will also underpin the
development and improve the living conditions of the residents in
Dhaka. This study not only reveals the level of satisfaction of the
residents in Dhaka concerning their housing facilities, but it will
also provide better guidelines for the academicians and especially
the managers of housing companies to formulate a better business
strategy. Thus, the objectives of this paper are to suggest an inte-
grative framework describing the factors that in?uence resident's
satisfaction with the facilities provided by the private apartment
companies in Bangladesh.
2. Theoretical background and model development
2.1. Overall satisfaction
The philosophy of customer satisfaction is not speci?c; rather it
varies from one industry to another (Hui & Zheng, 2010). Most re-
searchers de?ne customer satisfaction as a postchoice evaluative
judgment of a speci?c transaction, which can be viewed directly as
an overall feeling, best speci?ed as a function of perceived quality
(Bastos & Gallego, 2008; Parasuraman, Zeithaml, & Berry, 1985).
That is why customers are now becoming increasingly conscious of
their rights and are demanding higher quality service (Hui & Zheng,
2010). As a result, in the housing sector, residents' satisfaction of
housing facilities provided by private companies has become one of
the major issues in a country like Bangladesh (Barua, Mridha &
Khan, 2010). Customers' satisfaction with the facilities provided is
determined not only by technical performance, but also by effective
communication of the management (Choi, Cho, Lee, Lee, & Kim,
2004; Finch, 2004; Mustafa & Maznah, 2012; Snoj, Korda, &
Mumel, 2004). Residential satisfaction research deals with con-
sumers' satisfaction of housing products, and informs them about
housing policy and planning interventions (Fang, 2005). In view of
that housing satisfaction refers to the degree of contentment expe-
rienced by an individual or family with the current housing situation
or facilities (Liu, 1999; Morris, 1978). In fact, a majority of the resi-
dents are only slightly satis?ed with the facilities provided by the
respective authority within their residential area (Mohit & Azim,
2012). Francescato and Weidemann (1979) described residential
satisfaction as the emotional response to a person's dwelling, that is,
the positive or negative opinion the occupants have for the place
where they reside.
Recently, Abrahamsona, Bradley, Morganc, Fultonc, and
Ibrahimou (2013) provided insights about those service domains
that heavily in?uenced the satisfaction among residents in assisted
living facilities. According to Berkoz, Turk, and Kellekci (2009) and
Abrahamsona et al. (2013) factors that increase the level of resident
satisfaction are environmental quality, attractiveness of the facility,
personal issues and their management, accessibility, housing
environment, security, and relationships with neighborhoods.
2.2. Housing expenses and affordability
According to Haffner and Heylen (2011), the net housing
expense for homeowners is calculated by the difference between
the “loan ?nancing expenses” and “income tax effects.” Based on
the previous empirical ?ndings, the researchers agree that a strong
connection exists between housing expenses and affordability,
which plays a vital role in determining residents' satisfaction
(Centre for Housing Research Aotearoa New Zealand, 2004; Field,
1997; Mohit & Azim, 2012; O'Flynn, 2011). Carter (2011) noted
that both affordability and should-cost analyses play a crucial rule
before the production of any goods and services. The ?rst one
concerns with production cost and the sustainment cost for a
product driven by what the end consumers can pay. It is to be noted
because expenses always come into the mind of the consumers, the
cost of a product should be set down to wherever that makes sense.
Affordability analyses are based on the out-of-pocket expenses that
households make to ?nance their housing consumption. It is what
Hancock (1993, p. 140) calls the “short-run costs” being the ex-
penses that households make to ?nance the access to their home.
According to Wilcox (1999), the concept of affordability of housing
is a “vexed one”. It means different things to different people
(Quigley & Raphael, 2004).
Haffner and Heylen (2011) depicted two aspects of affordability,
namely, short-term affordability and long-term affordability. The
?rst one concerns the ?nancial access to the residence and is based
on the cash ?ows, whereas the second one is the long-term
affordability, which is about the costs of housing consumption.
Furthermore, affordability is not a one-dimensional concept, but is
concerned with securing any given standard of housing (or different
standards) at a price or a rent that does not impose, in the eyes of any
third party (usually government) an unreasonable burden on
household incomes (Freeman, Kiddle, & Whitehead, 2000; Hancock,
1993). However, without a standard for housing quality, it is not even
possible to evaluate whether housing indeed is unaffordable as
quality in?uences this evaluation (Thalmann, 2003). Thus, afford-
ability is generally considered fundamental to housing satisfaction
and there exists a relationship between expenses, affordability, and
levels of satisfaction of the residents (Healy, 2002). This study also
M.S. Rahman et al. / Asia Paci?c Management Review 20 (2015) 130e140 131
investigates the relationship between housing expense by an indi-
vidual citizen and its in?uence on their overall satisfaction when
affordability plays as a mediating role. To the best of our knowledge,
there are not many studies conducted from the viewpoint of con-
sumers in a least developing country. Taken together, the intensity of
individual resident's housing expenses enhances the level of
affordability, which ultimately in?uences their satisfaction levels.
This research, therefore, advances the following hypothesis:
Hypothesis 1: A signi?cant relationship exists between housing
expenses incurred by the residents and their satisfaction with the
private housing companies when affordability plays a mediating
role
2.3. Service quality and hygiene condition
The satisfaction of a customer depends on the level of service
quality (Lee & Lee, 2000). Over the years, the concept of service
quality has been extensively applied by the hospitality and service
industries (Douglas & Connor, 2003; Lee & Lee, 2000). However,
from the housing sector's perspective, the service quality and
customers' satisfaction levels can be measured by the following
features: “Tangibility” (condition of physical assets such as the
building fabric, infrastructure, and building services systems);
“Reliability” ( to perform the promised service dependably and
accurately by the resident authority); “Responsiveness” (willing-
ness to help building stakeholders and provide prompt service);
“Assurance” (knowledge and courtesy of employees and their
ability to convey trust and con?dence to the residents), and lastly,
“Empathy” (providing caring and individualized attention to
building stakeholders; Fitzsimmons, Noh, & Thies, 1998; Li & Siu,
2001). Results of previous studies have suggested that households
in developing countries are not satis?ed by the overall services
usually provided by the housing units (Aribigbola, 2008; Daramola,
2006; Jiboye, 2004; Ukoha & Beamish, 1997). Karsten (2007) indi-
cated that housing quality is composed of the following two major
ingredients: (1) accommodation for daily life and (2) the situation
of the neighborhood.
However, third ingredient called “hygienic conditions” was
addedtothe housing quality. This is relatedtothe service qualityof a
particular residential area, which primarily includes some essential
attributes such as the locality's decency, security, privacy,
spaciousness, healthy environment, affordability, legally secured
tenures; in addition, it should also accommodate a range of needs
and should be habitable, accessible, and well served by public
transport with connections to work, social, and leisure opportu-
nities (Coleman, 1985; Fiadzo, Houston, & Godwin, 2001; Pickles,
1998; Zubairu, 2002). These hygienic conditions are fundamental
to promoting healthy housing and better living conditions, and
contribute to physical and psychological well-being, which ulti-
mately in?uences the development of social integration of in-
dividuals within the community (Bonnefoy, 2007; Schwaller, 2003).
A high-quality environment conveys a sense of well-being and
satisfaction to its population through the characteristics of hygienic
conditions that may be physical (e.g., house style and condition,
landscaping, available facilities; Lansing and Marans, 1969).
In addition, Canter (1983), Kaitilla (1993), and Mohit, Ibrahim,
and Rashid (2010) presented a subjective approach to evaluate
the perception of occupants on quality of housing and residential
environment, which greatly in?uence the satisfaction levels of the
occupants. By contrast, in some cases, satisfaction with the home is
determined by location rather than by housing type or condition
(Ineichen, 1993). Therefore, we aimed to provide more insights into
the service quality and its in?uence on residents' satisfaction that is
mediated by hygienic conditions. Thus, this research postulates
Hypothesis 2: Service quality has a signi?cant in?uence on resi-
dents' satisfaction when hygienic conditions play a mediating role
2.4. Community attachment facilities
The concept of community attachment can be de?ned by the
sense of place, which is a collection of symbolic meanings,
attachment, and satisfaction with a spatial setting held by an in-
dividual or group (Stedman, 2002). Jorgensen and Stedman (2001)
classi?ed this concept by place identity, place dependence, and
place attachment. Of these three constructs, place attachment was
found to have the most in?uence on a sense of place, which is
de?ned as the involvement between an individual and a place and
the individual's commitment to that place (Tigges, 2006; Williams,
Patterson, Roggenbuck, & Watson, 1992). Previous scholars agree
that the length of time a person has resided in a community is the
most important variable linked to community attachment (Beggs,
Hurlbert, & Haines, 1996). In addition, community is further
de?ned as a group of people who reside in a speci?c locality and
who exercise some degree of local autonomy in organizing their
social life in such a way that they can, within that locality base,
satisfy the full range of their daily needs (Edwards & Jones, 1976, p.
12). Therefore, community attachment to a great extent in?uences
the sense of satisfaction one has with the neighborhood (Forrest &
Kearns, 1999; Goodman & Hankin, 1984).
This sense of satisfaction with one's neighbors is in turn
dependent on a number of attributes that enhance one's feelings
toward the people around and to the environment within the
community (Fredland, 1974; Goodman & Hankin, 1984; Porell,
1982; Rossi, 1980). According to Brehm, Eisenhauer, and Krannich
(2004), most of the researchers investigated community attach-
ment and its relationship with personal and social connections,
whereas only little research was conducted on the association be-
tween community attachment and residents' satisfaction. There-
fore, this study ?lls this gap by examining such a relationship by
proposing the following hypothesis:
Hypothesis 3: A signi?cant relationship exists between community
attachment facilities and residents' satisfaction
3. Conceptual framework
The entire analysis is based on the theoretical framework. The
theoretical framework offers the conceptual foundation to proceed
with the research. Based on the literature review, this research fo-
cuses onthe conceptual framework of the residents' satisfactionwith
the facilities provided by the private housing companies in Dhaka,
Bangladesh. This framework emphasizes that variables such as
housing expenses, service quality, and community attachment fa-
cilities are independent variables that are positively related to the
satisfactionof the residents, whichwas mediated byaffordabilityand
hygienic conditions. The proposed framework is presented in Fig. 1.
4. Research methodology
Structured questionnaires were given to potential respondents in
Dhaka (capital city of Bangladesh) to obtain speci?c information. The
survey questions were set ina prede?ned order; thus, data collection
was also direct (Malhotra, 1999). The survey was self-administered.
4.1. Measures and selecting the format of responses
Because the instrument for measuring the residents' satisfaction
of their current living conditions was developed from scratch, a
M.S. Rahman et al. / Asia Paci?c Management Review 20 (2015) 130e140 132
number of stages were followed. These include the selection and
creation of items, exploratory survey, content validity, pretest, pilot
test, and con?rmatory study. All of the measures used in this study
were drawn from existing literature and were translated and
adapted to the context of this research except for measures related
to affordability and expense variable. Based on literature reviews
and the suggestions of 10 academic experts, the initial instrument
was developed. A pretest of the resulting instrument was con-
ducted with 30 respondents who were randomly selected from a
particular residential area in Dhaka. The respondents were asked to
complete the questionnaire, to determine whether they could un-
derstand the verbiage, and to suggest improvements. The pretest
participants suggested that most of the items under each construct
were understandable and categorized appropriately. In addition,
the time taken to complete the questionnaire was also established.
This study used a 5-point Likert scale, which has been accepted
by various scholars (Aaker, Kumar, & Day, 2001; Neuman, 2000).
There are a number of reasons for choosing a Likert scale as the
interval scale in this research. First, this type of scale has been found
to communicate interval properties to the respondent, and there-
fore produce data that can be assumed to be interval-scaled. Sec-
ond, in the marketing literature, Likert scales are almost always
treated as interval scales (Aaker et al., 2001). Because Likert scales
are treated as interval scales, polychromic correlations were not
used in structural equation modeling (SEM), which is commonly
applied in analysis using AMOS.
In addition, affordability was measured with an initial ?ve items
extracted from the literature review. These ?ve items were as fol-
lows: affordable or middle-income group, easy access of loan, price
of the apartment within the limit of the income, easy ?nancial
access to purchase an apartment, and third-party support to pur-
chase an apartment other than government. This scale proved to be
adequately reliable (alpha ¼0.827). Residents' expenses on housing
were operationalized using the following ?ve items: always
considering the expense before purchasing an apartment; wants to
pay extra if I am satis?ed; saving is more important than an
expense for a new apartment; dif?cult to purchase a moderate
apartment; and in?uenced by the family member to buy a new
apartment. This scale was also proved to be adequately reliable
(alpha ¼ 0.823). Service quality was operationalized using the
following ?ve items: perform the promised service dependably;
security and privacy; willingness to help building stakeholders and
provide prompt service; courtesy of employees and their ability to
convey trust and con?dence to the residents. These items were
adapted from Karsten (2007), Fitzsimmons et al. (1998), and Li and
Siu (2001). The selected scales of service quality had good reliability
(alpha ¼ 0.924). For measuring hygienic condition, the following
?ve items were adapted from literature (Coleman, 1985; Fiadzo
et al., 2001; Pickles, 1998): decency of the current living area,
spacious within my living area, healthy condition, accessible by
public transport with connections to work, and social and leisure
opportunities. These also had adequately reliability (alpha ¼0.867).
In addition, community attachment was operationalized using
the following ?ve items: satisfaction in social and neighborhood
relationships, expecting community support, community organizes
various national and social activities, feeling that you belong to the
community, and people with interests and values similar to yours.
These were adapted from the works of Gober, McHugh, and Leclerc
(1993). This scale also proved to be adequately reliable
(alpha ¼ 0.923). Finally, the dependent variable “residents' satis-
faction” was assessed using the following four items: environ-
mental quality, characteristics of household members, features
related to the housing, characteristics of the housing environment,
and the appearance of the housing environment, which were
adopted from Berkoz et al. (2009). This scale showed adequate
reliability (alpha ¼ 0.926).
4.2. Sampling procedure
Because this study investigated the resident's satisfaction of
facilities provided by private housing providers in Dhaka, we
believed that the data collected would be more reliable if the in-
formation can be directly gathered from residents of different age
groups in the Dhaka residential area. Therefore, the target popu-
lation for the survey included citizens aged 18e50 or older. The
questionnaires were distributed to the respondents according to
the number of residents in each area in Dhaka to minimize bias. The
convenient sampling method was used for this purpose. Conve-
nient sampling is most often used during the exploratory phase of a
research and is perhaps the best way of getting information quickly
and ef?ciently (Brito, Aguilar, & Brito, 2007; Carmon, 2010; Chen,
2009; Manaktola & Jauhari, 2007; Sekaran, 2000; Tih & Ennis,
2006; Tse, 1995). Data were collected from January 2012 to March
2012 by applying the convenience sampling procedure to the res-
idents in established residential areas in different parts of Dhaka
(e.g., Gulshan, Baridhara, Uttara model town, Mirpur). Following
data screening, there were a total of 600 samples, which adequately
represent the study population (Roscoe, 1975).
4.3. Data analysis procedures
The data analysis included four stages. Descriptive and infer-
ential statistical techniques were used for analyzing the screened
data. Data were coded and analyzed using the Statistical Packages
for Social Sciences and AMOS software. The ?rst stage of the data
analysis used means, frequency, and percentages to present the
respondent's overall demographic pro?le. In the second stage, an
exploratory factor analysis (EFA) was conducted to identify the
factor structure and check the validity and the reliability of the
scale. A factor was considered signi?cant if the factor loading was
H2
Resident’s satisfaction (RS)
Community attachment
(CA)
Affordability (AF)
Housing expenses (HE)
Hygienic conditions
(HC)
Services quality
(SQ)
H1
H3
Fig. 1. Conceptual framework of this study.
M.S. Rahman et al. / Asia Paci?c Management Review 20 (2015) 130e140 133
greater than 0.5 and its eigenvalue was equal to or greater than 1.
The Cronbach alpha coef?cient was used to test the reliability of the
scale. In the third stage, con?rmatory factor analysis (CFA) was
performed to con?rm the factor structure, and check the validity
and reliability of the measuring scale. The adequacy of the mea-
surement model was evaluated based on the following: overall ?t
with data, content validity, unidimensionality analysis, convergent
validity, discriminate validity, and reliability. In this study,
goodness-of-?t testing was conducted using several criteria,
including the Chi-square test, root-mean-square error of approxi-
mation (RMSEA), goodness-of-?t index (GFI), adjusted goodness-
of-?t index (AGFI), normed ?t index (NFI), and comparative ?t in-
dex (CFI), etc.
However, to test Hypotheses 1e3, the fourth part of the data
analysis identi?ed the structural relationships between housing
expenses, service quality, and community attachment with re-
gard to residents' satisfaction of the private housing providers in
Dhaka. It was hypothesized that affordability and hygienic con-
dition play a mediating role under housing expenses and service
quality.
4.4. Estimation and model ?t and absolute measure of ?t
Joreskog and Sorbom (1989) introduced two indices called GFI
and AGFI and these were used in this research. The GFI indicates
goodness-of-?t, and the AGFI attempts to adjust the GFI for the
complexity of the model. Two other well-known measures are the
TuckereLewis Index (Tucker & Lewis, 1973), better known as the
non-normed ?t index (NNFI), and the NFI, which were also used in
this research (Bentler & Bonett, 1980). The most basic measure of
absolute ?t is the Chi-square statistic. However, to assess how well
a given model approximates the exact model, we used RMSEA. If
the approximation is good, the RMSEA value should be small.
Typically, an RMSEAof less than 0.05 is required (Browne &Cudeck,
1993; Hox & Bechger, 1998).
4.4.1. Incremental ?t measures
There are many incremental ?t indices, but some of the most
famous ones are the NFI, NNFI, and CFI, and these were frequently
used in this study (Shah & Goldstein, 2006).
4.4.2. Measurement model ?t
The measurement model ?t was evaluated in two ways: ?rst by
assessing the reliability and the convergent and discriminant val-
idity of the constructs and second by examining the individual path
(parameter) estimates (Bollen, 1989). Various indices of reliability
were also computed to summarize howwell the latent variables are
measured by the mediating variables (either individually or
together). In addition, data on individual item's reliability, com-
posite reliability, and average variance were also extracted from
this research (Bagozzi & Yi, 1988; Fornell & Larcker, 1981).
5. Data analysis
5.1. Descriptive analysis results of survey and respondent's pro?le
A total of 700 questionnaires were distributed to 700 residents
in signi?cant residential areas of Bangladesh (Mirpur, Muhammd-
pur, Uttara residential area, Gulshan, and Baridhara). A total of 650
questionnaires were returned (raw response rate, 92.8%); of these,
50 questionnaires were incomplete, and were thus rejected.
Therefore, we analyzed a total of 600 usable questionnaires
(adjusted response rate, 85%).
5.2. Demographic pro?le of respondents
Among the 600 respondents investigated in this study, a ma-
jority of respondents were male (54.0%; female respondents
comprised the remaining 46.0%). Of the 600 respondents, a sig-
ni?cant number of respondents were living in Mirpur and Bar-
idhara, followed by Uttara and Gulshan in Dhaka. With regard to
the age group, a majority of respondents were aged between 20 and
29 (41.66%). There were equal proportions (25%) of respondents
aged less than 20 and aged 30e39. Therefore, from the aforemen-
tioned information it is pretty clear that most of the respondents
were between 20 and 39 years of age.
5.3. Reliability analysis results for all the attributes of the
questionnaire
The internal consistency of all the items was assessed using
Cronbach alpha. The Cronbach alpha for the overall scale (nominal)
was 0.912 (Table 1). The reliability of the overall items is in the
acceptable range, meaning that the stability and consistency of the
items were good enough for the researchers to move ahead to other
statistical tests.
5.4. Exploratory factor analysis
EFA is a widely utilized and broadly applied statistical technique
in social sciences. A total of 600 usable survey responses were
analyzed in this section. Factor analysis was used to condense the
information contained in these attributes and to con?rmthe notion
that distinct dimensions existed. To assess the validity and reli-
ability of each construct, factor analysis and reliability testing were
used. The items in housing expenses (n ¼ 5), affordability (n ¼ 5),
service quality (n ¼ 5), hygienic conditions (n ¼ 5), and community
attachment (n ¼ 5) were subjected to factor analysis. To test the
appropriateness of factor analysis, the overall measure of sampling
adequacy was calculated (0.869) using the KaisereMeyereOlkin
index, which is meritorious (Kaiser, 1974). In addition, the com-
munalities of each variable ranged from 0.54 to 0.96, with an
average value above 0.62, suggesting that the variance of the
original values was somewhat explained by the common factors.
Then, Bartlett's test of sphericity was conducted, which gave a
signi?cant Chi-square value to test the signi?cance of the correla-
tion matrix (c
2
¼ 3236.980, df ¼ 325, signi?cance ¼ 0.000). Both
tests indicated that factor analysis was appropriate for this study
(Hair, Anderson, Tatham, & Black, 1998; Tabachnick & Fidell, 2001).
After the viability of the factor analysis was determined, principal
component analysis with a varimax rotation was performed. The
varimax, rather than quartimax rotation, was adopted, because we
wanted to identify several dimensions of equal importance in the
data. Items with a factor loading of 0.60 or higher were clustered
together to form constructs and all factors with eigenvalues greater
than 1 were retained (Hair et al., 1998). As a result, ?ve stable
factors with eigenvalues greater than one (explaining 55.379% of
the variance) were derived from the analysis. The factors and their
component variables were analyzed and termed as follows: hous-
ing expenses (3 items, Factor 1), affordability (4 items, Factor 2),
service quality (3 items, Factor 3), hygienic conditions (3 items,
Factor 4), and community attachment (3 items, Factor 5; Table 2).
Table 1
Reliability statistics for all items in the instruments.
Cronbach alpha Cronbach alpha based on standardized items No. of items
0.912 0.940 29
M.S. Rahman et al. / Asia Paci?c Management Review 20 (2015) 130e140 134
5.5. Measurement of validity
Following the two-stage approach suggested by Anderson and
Gerbing (1988), this research used AMOS-7 to test the estimated
measurement model before assessing the structural relationships.
The testing model with all indicators is shown in Fig. 2. All mea-
surement scales were evaluated based on unidimensionality,
convergent validity, and discriminant validity (Anderson & Gerbing,
1988). In addition, this research also maintained validity (e.g., con-
tent or face validity and construct validity) and reliability (Table 3).
The results of the measurement models indicate that all the retained
items from the EFA provide a good ?t for each of the construct,
which had already been re?ected in the results of CFA (Table 4). This
con?rms adequate unidimensionality and convergent validity.
To examine discriminant validity, this research utilized a pair-
wise comparison of the constructs in the modi?cation indices. All
the latent attributes' correlations between constructs were found
to be signi?cantly different from each other except items A2 to A3;
HE3 to HE4; and Sq1 to Sq4. Overall, this research concluded that all
the measures demonstrated good measurement properties. Many
Table 2
Summary of exploratory factor analysis.
Factor name EV1 PV2 CV3 Component variables Factor loading
1. Housing expenses
(alpha ¼ 0.861)
6.931 26.659 26.659 Always considering the expense before purchasing an apartment 0.697
Wants to pay extra if I am satis?ed 0.739
Saving is more important than an expense for a new apartment 0.727
Dif?cult to purchase a moderate apartment 0.723
2. Affordability
(alpha ¼ 0.862)
2.094 8.056 34.715 Affordable or middle-income group 0.779
Easy ?nancial access to purchase an apartment 0.871
Third-party support to purchase an apartment other than government 0.666
3. Service quality
(alpha ¼ 0.841)
1.727 6.638 41.353 Condition of physical assets 0.679
Perform the promised service dependably 0.678
Security and privacy 0.618
4. Hygienic condition
(alpha ¼ 0.821)
1.314 5.048 46.401 Decency 0.679
Spacious 0.878
Healthy 0.618
5. Community attachment
(alpha ¼ 0.851)
1.278 4.721 55.337 Satisfaction with existing residents 0.679
Community support 0.778
Organizing various national and social activities 0.618
CV3 ¼ cumulative variance; EV1 ¼ eigenvalue; PV2 ¼ percent of variance.
Fig. 2. Hypothesized model of relationships among key variables. AF ¼affordability; CA ¼community attachment; HC ¼ hygienic condition; HE ¼ housing expenses; RS ¼ residents'
satisfaction; SQ ¼ service quality.
M.S. Rahman et al. / Asia Paci?c Management Review 20 (2015) 130e140 135
different aspects of construct validity had been proposed in the
psychometric literature (Bagozzi, Yi, & Philips, 1991). In the SEM
methods, construct validity was viewed as hypothesis testing in
which particular relations were tested (Hoyle & Smith, 1994). For
composite measures of the constructs, the summated mean scales
were calculated (Hair et al., 1998). Criterion validity was assessed by
correlation analysis in this study with the summated mean scales of
the constructs. The matrix from the correlation analysis of the
variables indicates signi?cant intercorrelations among the entire
construct.
5.6. Con?rmatory Factor Analysis
To con?rm the factor structure, CFA was performed. Overall, the
?t indices improved from the default to the revised model after
adjusting certain variables (HE, AF and SQ). The CFA results ob-
tained using AMOS are presented in Table 4. The ?t indices
demonstrated a good ?t of the measurement models to the data.
The entire model was tested based on the measurement model
previously validated fromCFA in this study (Fig. 2). The ?t indices of
the entire model were c
2
/df ¼ 2.708 (c
2
¼ 3678.133, df ¼ 1358);
GFI ¼0.931; AGFI ¼0.905; RMSEA ¼0.055; CFI ¼0.913; NFI ¼0.914
(Table 5). Although a relative Chi-square statistic (c
2
/df ¼ 2.708)
indicated a good ?t, other indices were at the lower end of
acceptable ranges to indicate a good model ?t.
To test the mediation, this research then sought to determine
the mediating role of affordability housing between housing ex-
penses and resident's satisfaction by examining the direct and in-
direct effects. This study also investigated the mediating role of
hygienic conditions between service quality and residents' satis-
faction (Chang, Park, & Cahiy, 2010). In addition, we also compared
the magnitude of total (direct and indirect) effects between
housing expenses (HE), service quality (SQ), and community
attachment (CA) and resident satisfaction (RS), respectively. The
total effect of housing expense (HE) on affordability (AF) was 0.615.
This was due to both direct and indirect (mediated) effects of
housing expenses (HE) on affordability (AF); when housing ex-
penses (HE) go up by 1, affordability (AF) goes up by 0.615. The total
(direct and indirect) effects of housing expenses (HE) on residents'
satisfaction (RS) was .539. This was also due to both direct and
indirect (mediated) effects of housing expenses (HE) on resident
satisfaction (RS); when housing expenses (HE) go up by 1, resident
satisfaction (RS) goes up by 0.539. The total (direct and indirect)
effect of hygienic condition (HC) on resident satisfaction (RS) was
0.598. This was also due to both direct (unmediated) and indirect
(mediated) effects of hygienic condition (HC) on resident satisfac-
tion (RS); when hygienic condition (HC) goes up by 1, resident
satisfaction (RS) goes up by 0.598. The total (direct and indirect)
effect of affordability (AF) on residents' satisfaction was (RS) 0.877.
That is again due to both direct (unmediated) and indirect (medi-
ated) effects of affordability (AF) on residents' satisfaction (RS);
when affordability goes up by 1, residents' satisfaction (RS) goes up
by 0.877. The total (direct and indirect) effects of community
attachment (CA) on residents' satisfaction (RS) was 0.159. This was
due to both direct (unmediated) and indirect (mediated) effects of
community attachment (CA) on residents' satisfaction (RS); when
community attachment (CA) goes up by 1, residents' satisfaction
(RS) goes up by 0.159. Therefore, we can conclude that the indirect
effects (affordability and hygienic conditions) were more dominant
than the direct effects in explaining the total effect.
5.7. Hypothesis testing
To assess the mediating effects on residents' satisfaction with
private housing providers in Dhaka and to examine the predictive
validity of the hypothesized model, decomposition of effects using
Mplus was performed. As predicted, affordability and hygienic
conditions had a signi?cant mediating effect on housing expenses
and service quality supporting H1 and H2 (Table 6). The results also
Table 3
Assessment of validity and reliability.
Types of validity
and reliability
De?nition Assessment strategies in this research
Validity The accuracy of measurement (Bollen, 1989; Davis & Cosenza, 1993). The approaches taken to scale development in the
methodology part (Churchill, 1979).
Content or face
validity
The degree to which the content of an indicator re?ects the concept
(Burns & Bush, 2000; Neuman, 2000; Parasuraman, 1991)
Ensured through in-depth literature review, feedback from
experts, pretesting of questionnaire, and con?rmatory
factor analysis.
Construct validity The degree to which a construct achieves empirical and theoretical
meaning (Steenkamp & Van Trijp, 1991)
Literature review, pretesting questionnaire, and data analysis
(EFA, CFA, and SEM).
Convergent validity The degree of association between two different measurement scales,
which are supposed to measure the same concept (Davis & Cosenza, 1993)
Data analysis (EFA, CFA, and SEM).
Discriminant validity The degree to which the measurement is different from other scales
supposed to measure different constructs (Davis & Cosenza, 1993)
Data analysis (EFA, CFA, and SEM).
Reliability A measure is reliable to the extent that is an independent, but a comparable,
measure of the same trait or construct agrees (Churchill, 1979).
Clear statement and multiple indicators in the questionnaire,
and pretesting of questionnaire.
Adapted from Lawley, M.A. (1998) e Choice of Destination in International Education: Cross National Model University of Southern Queensland, University of Southern
Queensland, Toowoomba, Queensland, Australia (along with other sources acknowledged in it).
CFA ¼ con?rmatory factor analysis; EFA ¼ exploratory factor analysis; SEM ¼ structural equation modeling.
Table 4
Con?rmatory factor analysis using AMOS.
Theoretical construct Model GFI AGFI RMSEA CFI NFI
Housing expenses Default 0.921 0.906 0.058 0.921 0.900
Revised 0.945 0.924 0.050 0.965 0.934
Affordability Default 0.940 0.900 0.061 0.910 0.904
Revised 0.970 0.941 0.041 0.964 0.961
Service quality Default 0.951 0.903 0.100 0.907 0.888
Revised 0.990 0.973 0.029 0.994 0.977
Hygienic condition Default 0.991 0.973 0.043 0.991 0.979
AGFI ¼adjusted goodness-of-?t index; CFI ¼comparative ?t index; GFI ¼goodness-
of-?t index; NFI ¼ normed ?t index; RMSEA ¼ root-mean-square error of
approximation.
Table 5
Summary of goodness-of ?t indices for full model testing.
Model c
2
df c
2
/df GFI AGFI RMSEA CFI NFI
Default 3678.133 1358 2.708 0.931 0.905 0.055 0.913 0.914
AGFI ¼adjusted goodness-of-?t index; CFI ¼comparative ?t index; GFI ¼goodness-
of-?t index; NFI ¼ normed ?t index; RMSEA ¼ root-mean-square error of
approximation.
M.S. Rahman et al. / Asia Paci?c Management Review 20 (2015) 130e140 136
showed that there is a positive relationship between community
attachment and residents satisfaction (b ¼ 0.159, CR ¼ 3.090,
p ¼ 0.002), which nearly supports H3 (Table 6).
This research was directed to explore the residents' satisfaction
with facilities provided by the private apartment companies in
Bangladesh. Dhaka was selected as the study site. The result of this
empirical test is expected to ?ll in the existing knowledge gap by
exploration of the residents' satisfaction from a developing coun-
try's perspective. Determinations from the SEM revealed that there
is a strong mediation role of the “affordability” variable between
housing expenses made by the occupiers and their overall satis-
faction. By contrast, the service quality was found to positively in-
?uence residents' overall satisfaction when hygienic condition
plays a mediation function. This means that satisfaction of the
residents with the facilities offered by the owner substantially
depends on the overall service quality of the service providers
(Amerigo & Aragones, 1990).
In view of that, to ful?ll the necessities of the residents, this
research places a few touchstones, also supported by ?ndings of
previous studies, that are considered essential for residents:
physical quality, hygienic condition, location, standard of services
offered by the owners, and neighborhood characteristics (Abdul,
2008; Chi & Grif?n, 1980; Lord & Rent, 1987).
A majority of the respondents concurred that the atonement of
their current housing place are hugely impacted by the expenses.
As a result, not everybody can enjoy comfortable housing facilities
if he/she cannot afford to make these expenses. This determination
is similar to the ?ndings by the Gubbay (1999), who indicated that
housing satisfaction among the residents depends on the low
monetary value of tenant procurement. The studies by Adriaanse
(2007) and Lu (1999) con?rmed that income of households plays
an important role with regard to the grati?cation of individual
occupants. Above all, the researchers think that residents' satis-
faction with their current living place depends on the overall
ful?llment of their needs and dreams (Abdul, 2008). Housing
environment must have a positive living environment by catering
to all sorts of social factors and economic conditions (e.g., accessi-
bility to the workplace, availability of schools and shopping mall
based on their social status; Kellekci & Berkoz, 2006; Salleh, 2008;
Teck-Hong, 2012).
Thus, it is necessary that the residents' satisfaction with the
facilities provided by the private apartment companies in
Bangladesh should be adequately monitored by the agencies con-
cerned for the overall improvement of the residents' satisfaction.
The respective units of the government should check their current
housing development policy to ensure acceptable service delivery
by the private apartment companies in Bangladesh.
6. Conclusions
In a competitive world, apartment companies need to enhance
the quality of their services to sustain their competency in the
market to retain their valuable customers by ensuring that the
apartments are affordable. Therefore, an understanding of what
drives the customer to be more satis?ed is the key element for most
of the apartment business enterprises.
The study aimed to provide an insight into the relationships
between housing expenses, service quality, and community
attachment (de?ned as HE, SQ, and CA, respectively, in Fig. 2),
which in?uence residents' satisfaction (RS). For the ?rst time, to the
author's knowledge, affordability and hygienic conditions were
considered to play a mediating role between housing expenses and
service quality.
The research also demonstrates the use of SEM approach as a
powerful tool to clarify the causal relationships between these
latent and observed factors. We hope that these new contributions
of this study will improve the understanding of those three salient
inter-related clusters that have an effect on the satisfaction of res-
idents from the perspective of a developing country.
Based on literature review, the study results show that all the
three hypotheses postulated were acceptable. More importantly,
the ?ndings of this study suggest that there is a strong relationship
between service qualities (SQ) and residents' satisfaction (RS) when
hygienic conditions (HC) play a mediating role. This study also
con?rms that there is a signi?cant relationship between housing
expenses (HE) and residents' satisfaction (RS) when affordability
(AF) plays a mediating role. In addition, the result also con?rms that
community attachment (CA) has a weak relationship with the
residents' satisfaction (RS) level.
7. Managerial implications
The proposed model suggests that residents in Dhaka, capital of
Bangladesh, who are living in an apartment, expect their provider
to ensure all the facilities provided have decent living conditions.
The satisfaction of residents with the apartment owner starts from
the very beginning when the customers intend to purchase using
their savings (Freeman et al., 2000; Hancock, 1993). It seems very
logical to think that after buying an apartment the residents do
expect that certain services to meet their safety and social needs are
actually available in their locality.
Thus, collective efforts are very much essential for apartment
owners in Bangladesh. The mediating roles such as affordability
and hygienic conditions in their current living area are also
important. Along with housing expenses and the affordability of
the general customers, the apartment owners must also ensure
proper infrastructure and building services systems to gain the
trust and con?dence of residents. In addition, they must also
ensure that the living conditions provided have privacy and are
decent, secure, spacious, healthy, affordable, and with legally
secured tenures (Bonnefoy, 2007; Fitzsimmons et al., 1998; Li &
Siu, 2001; Zubairu, 2002). Each company in a developing coun-
try is constrained by limitations on the resources that are avail-
able. Therefore, the developer must plan accordingly to best
deploy the scarce resources in order to achieve the highest level of
customer satisfaction. Thus, priorities have to be set. Finally, this
Table 6
Estimates of the mentioned variables.
Path Estimates of
regression weight
Standard error of
regression weight
Critical ratio for
regression weight
p (level of signi?cance
for regression weight)
Affordability housing expense 0.615 0.119 5.149 0.000
Hygienic condition service quality 2.474 0.582 4.250 0.000
Residents' satisfaction hygienic condition 0.598 0.089 6.688 0.000
Residents' satisfaction community attachment 0.159 0.052 3.090 0.002
Residents' satisfaction affordability 0.877 0.192 4.564 0.000
M.S. Rahman et al. / Asia Paci?c Management Review 20 (2015) 130e140 137
research suggests that apartment developers should seriously
consider these things before selling an apartments; otherwise,
their reputation is affected, which is somehow re?ected by
customer loyalty.
8. Limitation and further study
Although this research study provided meaningful results, it is
not without limitations. First, the model chosen does not compre-
hensively re?ect various factors such as residents' perception and
experience. In addition, price of the apartment and government
intervention were not considered. Thus, it is suggested that these
factors are included in future research. Second, the data were
collected only once in a particular year for 3 months, whereas if
data were collected on a year-on-year survey, the research could
make a comparative study of the structural change in the residents'
satisfaction of the facilities provided by private apartment pro-
viders. However, because of practical problems (e.g., time con-
straints), this research did not use longitudinal research (Pettigrew,
1990).
Nevertheless, this study is the ?rst of its kind, to the best of our
knowledge, conducted on the customers of the Bangladeshi hous-
ing industry. In the future, further research should be conducted
using SEM to examine the relationship between customers' satis-
faction and other variables using an additional sample with
comprehensive statistical analysis including the moderating effects
of demographic items. As a whole, this research posits that the
potential buyers would consider the corresponding factors when
purchasing an apartment.
Con?icts of interest
All contributing authors declare no con?icts of interest.
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doc_595676284.pdf
In recent times, Bangladesh has faced serious housing problems, especially for people who live in cities.
In response, this study examines the relationship between housing expenses, affordability, service
quality, hygienic conditions, and community attachment and residents' satisfaction, respectively. A
questionnaire-based survey was carried out with customers in the major parts of Dhaka, Bangladesh. In
addition to descriptive analysis, other statistical analyses, such as exploratory factor analysis, confirmatory
factor analysis, and a structural equation modeling approach were used to test the hypotheses.
The findings reveal that there is a strong relationship between services provided by the private companies
and residents' satisfaction, with hygienic conditions playing a major role. This study also confirms
a significant relationship between housing expenses and residents' satisfaction when affordability plays a
mediating role. This study is the first of its kind, to the best of our knowledge, conducted on the customers
of the Bangladeshi housing industry. The contribution of this study is the construction of a
research theoretical framework that potentially highlights the perceived satisfaction or dissatisfaction of
residents with the facilities provided by the private apartment owners in Bangladesh.
Original article
Exploring residents' satisfaction of facilities provided by private apartment
companies
Muhammad Sabbir Rahman
a, *
, Bashir Hussain
b
, A.N.M. Meshquat Uddin
b
, Nazrul Islam
c
a
Faculty of Languages and Management, International Islamic University Malaysia (IIUM), Jalan Gombak, Selangor Darul Ehsan, Kuala Lumpur, Malaysia
b
School of Business, North South University (NSU), Dhaka, Bangladesh
c
School of Business, Eastern University (EU), Dhaka, Bangladesh
a r t i c l e i n f o
Article history:
Received 8 February 2014
Accepted 22 September 2014
Available online 4 April 2015
Keywords:
Affordability
Community attachment
Housing expenses
Hygienic conditions
Residents satisfaction
a b s t r a c t
In recent times, Bangladesh has faced serious housing problems, especially for people who live in cities.
In response, this study examines the relationship between housing expenses, affordability, service
quality, hygienic conditions, and community attachment and residents' satisfaction, respectively. A
questionnaire-based survey was carried out with customers in the major parts of Dhaka, Bangladesh. In
addition to descriptive analysis, other statistical analyses, such as exploratory factor analysis, con?r-
matory factor analysis, and a structural equation modeling approach were used to test the hypotheses.
The ?ndings reveal that there is a strong relationship between services provided by the private com-
panies and residents' satisfaction, with hygienic conditions playing a major role. This study also con?rms
a signi?cant relationship between housing expenses and residents' satisfaction when affordability plays a
mediating role. This study is the ?rst of its kind, to the best of our knowledge, conducted on the cus-
tomers of the Bangladeshi housing industry. The contribution of this study is the construction of a
research theoretical framework that potentially highlights the perceived satisfaction or dissatisfaction of
residents with the facilities provided by the private apartment owners in Bangladesh.
© 2015, College of Management, National Cheng Kung University. Production and hosting by Elsevier
Taiwan LLC. All rights reserved.
1. Introduction
The role of housing is part of the social environment rather than
the personal environment. That is why the reputation of an area and
the people living in that area are stronger predictors of residents'
psychosocial bene?ts, such as autonomy, comfort, and status
(Dupuis & Thorns, 1998; Kearns, Hiscock, Ellaway, & Macintyre,
2000). In addition, Shaw (2004) and Wilkinson (1999) argued that
inadequate housing facilities highly in?uenced the poor health of
the residents. Housing facilities also have a positive impact on the
mental health of residents (Thomson & Petticrew, 2005). Studies by
the Commission on Social Determinants of Health (2008) and
Scottish Government (2008) revealed that neighborhood conditions
could also have an impact on the quality of life of the residents.
Evans, Wells, and Moch (2003) and Evans (2003) suggested that
housing design (e.g., dwelling type and street layout) could also
affect the psychological perspective of residents, such as mental
health. Having less control over the shared space and the lack of
social interaction between residents who are living in high-rise
buildings, where housing units comprise a large number of sepa-
rate units, may have an adverse impact on the residents' psycho-
logical perspective, especially mental health (Evans, 2003; Evans
et al., 2003; Weich et al., 2002). Even large blocks of ?ats some-
times discourage social interaction between the neighbors (Day,
2008). A study of residents in the west of Scotland indicated that
those who live in a house as opposed to a ?at, and those who have
access to a garden have more signi?cant psychosocial bene?ts and
greater autonomy over their home (Hiscock, Kearns, Macintyre, &
Ellaway, 2001; Kearns et al., 2000). In fact, the surrounding envi-
ronment of a residential area must include certain characteristics,
such as visual amenity, access to green space, and spaces that permit
social interaction, which ultimately positively affect the well-being
and quality of life of the residents (Cattell, Dines, Gesler, & Curtis,
* Corresponding author. Faculty of Languages and Management, International
Islamic University Malaysia (IIUM), P.O. Box 10, Jalan Gombak, Selangor Darul
Ehsan, 50728 Kuala Lumpur, Malaysia.
E-mail addresses: [email protected], [email protected]
(M.S. Rahman).
Peer review under responsibility of College of Management, National Cheng
Kung University.
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j ournal homepage: www. el sevi er. com/ l ocat e/ apmrv
http://dx.doi.org/10.1016/j.apmrv.2014.12.012
1029-3132/© 2015, College of Management, National Cheng Kung University. Production and hosting by Elsevier Taiwan LLC. All rights reserved.
Asia Paci?c Management Review 20 (2015) 130e140
2008; Day, 2008; O'Campo, Salmon, & Burke, 2008; Thomson,
Kearns, & Petticrew, 2003; Warr, Tacticos, Kelaher, & Klein, 2007).
At present, citizens of Bangladesh are facing serious housing
problems, especially those people living inthe cityarea. This is due to
the low rate of gross domestic product, population densities, high
population growth rate in urban areas, and poor standard of living
conditions [Asian Development Bank (ADB), 1995]. According to a
report from the ADB (1995), the situation has not yet improved
signi?cantlyover thepast decade. Inrecent times, a number of private
companies have started offering low-cost housing facilities to meet
the needs of the existing residents. However, very little empirical
analysis has been carried out on housing conditions in Bangladesh.
Thus, there is an urgent need for high-quality empirical research on
resident's satisfaction concerning housing facilities provided by the
private companies in a least developing country like Bangladesh.
Dhaka was chosen as the study site. According to one estimate,
about 320,000 migrants enter Dhaka annually (Islam, Huda, &
Narayan, 1997). This situation causes tremendous stress on the fa-
cilities, which subsequently have a negative impact on the indi-
vidual resident's satisfaction (Uddin et al., 2009). Dhaka is one of
the dynamic cities in Bangladesh that attracts almost
300,000e400,000 new migrants each year. Most migrants come
from rural areas in search of opportunities. The lineaments of the
city include extremely high land costs, very high rental price of
apartments, high apartment purchase price, poor quality of housing
facilities, traf?c congestion, water de?cits, inadequate sanitation
and drainage facilities, irregular electric supply, and increasing air
pollution. However, reports indicate that population of Dhaka is
expected to rise to approximately 20 million in 2020, making it the
world's third greatest metropolis (The World Bank Of?ce, Dhaka,
2007). Given this rapid increase, the shortage of suf?cient infra-
structure and services, and growing social and environmental
problems necessitate an urgent attention to exploring the resi-
dents' satisfaction with facilities provided by the private apartment
companies. To evaluate the magnitude of these problems, this
research focuses on the residents of Dhaka city. We expect that this
effort will lead to a fuller understanding of residents' satisfaction of
their current living place, thus providing fruitful information for the
policy-makers to spot the priorities of residents' satisfaction with
facilities provided by the private apartment companies in
Bangladesh. As a consequence, this research will also underpin the
development and improve the living conditions of the residents in
Dhaka. This study not only reveals the level of satisfaction of the
residents in Dhaka concerning their housing facilities, but it will
also provide better guidelines for the academicians and especially
the managers of housing companies to formulate a better business
strategy. Thus, the objectives of this paper are to suggest an inte-
grative framework describing the factors that in?uence resident's
satisfaction with the facilities provided by the private apartment
companies in Bangladesh.
2. Theoretical background and model development
2.1. Overall satisfaction
The philosophy of customer satisfaction is not speci?c; rather it
varies from one industry to another (Hui & Zheng, 2010). Most re-
searchers de?ne customer satisfaction as a postchoice evaluative
judgment of a speci?c transaction, which can be viewed directly as
an overall feeling, best speci?ed as a function of perceived quality
(Bastos & Gallego, 2008; Parasuraman, Zeithaml, & Berry, 1985).
That is why customers are now becoming increasingly conscious of
their rights and are demanding higher quality service (Hui & Zheng,
2010). As a result, in the housing sector, residents' satisfaction of
housing facilities provided by private companies has become one of
the major issues in a country like Bangladesh (Barua, Mridha &
Khan, 2010). Customers' satisfaction with the facilities provided is
determined not only by technical performance, but also by effective
communication of the management (Choi, Cho, Lee, Lee, & Kim,
2004; Finch, 2004; Mustafa & Maznah, 2012; Snoj, Korda, &
Mumel, 2004). Residential satisfaction research deals with con-
sumers' satisfaction of housing products, and informs them about
housing policy and planning interventions (Fang, 2005). In view of
that housing satisfaction refers to the degree of contentment expe-
rienced by an individual or family with the current housing situation
or facilities (Liu, 1999; Morris, 1978). In fact, a majority of the resi-
dents are only slightly satis?ed with the facilities provided by the
respective authority within their residential area (Mohit & Azim,
2012). Francescato and Weidemann (1979) described residential
satisfaction as the emotional response to a person's dwelling, that is,
the positive or negative opinion the occupants have for the place
where they reside.
Recently, Abrahamsona, Bradley, Morganc, Fultonc, and
Ibrahimou (2013) provided insights about those service domains
that heavily in?uenced the satisfaction among residents in assisted
living facilities. According to Berkoz, Turk, and Kellekci (2009) and
Abrahamsona et al. (2013) factors that increase the level of resident
satisfaction are environmental quality, attractiveness of the facility,
personal issues and their management, accessibility, housing
environment, security, and relationships with neighborhoods.
2.2. Housing expenses and affordability
According to Haffner and Heylen (2011), the net housing
expense for homeowners is calculated by the difference between
the “loan ?nancing expenses” and “income tax effects.” Based on
the previous empirical ?ndings, the researchers agree that a strong
connection exists between housing expenses and affordability,
which plays a vital role in determining residents' satisfaction
(Centre for Housing Research Aotearoa New Zealand, 2004; Field,
1997; Mohit & Azim, 2012; O'Flynn, 2011). Carter (2011) noted
that both affordability and should-cost analyses play a crucial rule
before the production of any goods and services. The ?rst one
concerns with production cost and the sustainment cost for a
product driven by what the end consumers can pay. It is to be noted
because expenses always come into the mind of the consumers, the
cost of a product should be set down to wherever that makes sense.
Affordability analyses are based on the out-of-pocket expenses that
households make to ?nance their housing consumption. It is what
Hancock (1993, p. 140) calls the “short-run costs” being the ex-
penses that households make to ?nance the access to their home.
According to Wilcox (1999), the concept of affordability of housing
is a “vexed one”. It means different things to different people
(Quigley & Raphael, 2004).
Haffner and Heylen (2011) depicted two aspects of affordability,
namely, short-term affordability and long-term affordability. The
?rst one concerns the ?nancial access to the residence and is based
on the cash ?ows, whereas the second one is the long-term
affordability, which is about the costs of housing consumption.
Furthermore, affordability is not a one-dimensional concept, but is
concerned with securing any given standard of housing (or different
standards) at a price or a rent that does not impose, in the eyes of any
third party (usually government) an unreasonable burden on
household incomes (Freeman, Kiddle, & Whitehead, 2000; Hancock,
1993). However, without a standard for housing quality, it is not even
possible to evaluate whether housing indeed is unaffordable as
quality in?uences this evaluation (Thalmann, 2003). Thus, afford-
ability is generally considered fundamental to housing satisfaction
and there exists a relationship between expenses, affordability, and
levels of satisfaction of the residents (Healy, 2002). This study also
M.S. Rahman et al. / Asia Paci?c Management Review 20 (2015) 130e140 131
investigates the relationship between housing expense by an indi-
vidual citizen and its in?uence on their overall satisfaction when
affordability plays as a mediating role. To the best of our knowledge,
there are not many studies conducted from the viewpoint of con-
sumers in a least developing country. Taken together, the intensity of
individual resident's housing expenses enhances the level of
affordability, which ultimately in?uences their satisfaction levels.
This research, therefore, advances the following hypothesis:
Hypothesis 1: A signi?cant relationship exists between housing
expenses incurred by the residents and their satisfaction with the
private housing companies when affordability plays a mediating
role
2.3. Service quality and hygiene condition
The satisfaction of a customer depends on the level of service
quality (Lee & Lee, 2000). Over the years, the concept of service
quality has been extensively applied by the hospitality and service
industries (Douglas & Connor, 2003; Lee & Lee, 2000). However,
from the housing sector's perspective, the service quality and
customers' satisfaction levels can be measured by the following
features: “Tangibility” (condition of physical assets such as the
building fabric, infrastructure, and building services systems);
“Reliability” ( to perform the promised service dependably and
accurately by the resident authority); “Responsiveness” (willing-
ness to help building stakeholders and provide prompt service);
“Assurance” (knowledge and courtesy of employees and their
ability to convey trust and con?dence to the residents), and lastly,
“Empathy” (providing caring and individualized attention to
building stakeholders; Fitzsimmons, Noh, & Thies, 1998; Li & Siu,
2001). Results of previous studies have suggested that households
in developing countries are not satis?ed by the overall services
usually provided by the housing units (Aribigbola, 2008; Daramola,
2006; Jiboye, 2004; Ukoha & Beamish, 1997). Karsten (2007) indi-
cated that housing quality is composed of the following two major
ingredients: (1) accommodation for daily life and (2) the situation
of the neighborhood.
However, third ingredient called “hygienic conditions” was
addedtothe housing quality. This is relatedtothe service qualityof a
particular residential area, which primarily includes some essential
attributes such as the locality's decency, security, privacy,
spaciousness, healthy environment, affordability, legally secured
tenures; in addition, it should also accommodate a range of needs
and should be habitable, accessible, and well served by public
transport with connections to work, social, and leisure opportu-
nities (Coleman, 1985; Fiadzo, Houston, & Godwin, 2001; Pickles,
1998; Zubairu, 2002). These hygienic conditions are fundamental
to promoting healthy housing and better living conditions, and
contribute to physical and psychological well-being, which ulti-
mately in?uences the development of social integration of in-
dividuals within the community (Bonnefoy, 2007; Schwaller, 2003).
A high-quality environment conveys a sense of well-being and
satisfaction to its population through the characteristics of hygienic
conditions that may be physical (e.g., house style and condition,
landscaping, available facilities; Lansing and Marans, 1969).
In addition, Canter (1983), Kaitilla (1993), and Mohit, Ibrahim,
and Rashid (2010) presented a subjective approach to evaluate
the perception of occupants on quality of housing and residential
environment, which greatly in?uence the satisfaction levels of the
occupants. By contrast, in some cases, satisfaction with the home is
determined by location rather than by housing type or condition
(Ineichen, 1993). Therefore, we aimed to provide more insights into
the service quality and its in?uence on residents' satisfaction that is
mediated by hygienic conditions. Thus, this research postulates
Hypothesis 2: Service quality has a signi?cant in?uence on resi-
dents' satisfaction when hygienic conditions play a mediating role
2.4. Community attachment facilities
The concept of community attachment can be de?ned by the
sense of place, which is a collection of symbolic meanings,
attachment, and satisfaction with a spatial setting held by an in-
dividual or group (Stedman, 2002). Jorgensen and Stedman (2001)
classi?ed this concept by place identity, place dependence, and
place attachment. Of these three constructs, place attachment was
found to have the most in?uence on a sense of place, which is
de?ned as the involvement between an individual and a place and
the individual's commitment to that place (Tigges, 2006; Williams,
Patterson, Roggenbuck, & Watson, 1992). Previous scholars agree
that the length of time a person has resided in a community is the
most important variable linked to community attachment (Beggs,
Hurlbert, & Haines, 1996). In addition, community is further
de?ned as a group of people who reside in a speci?c locality and
who exercise some degree of local autonomy in organizing their
social life in such a way that they can, within that locality base,
satisfy the full range of their daily needs (Edwards & Jones, 1976, p.
12). Therefore, community attachment to a great extent in?uences
the sense of satisfaction one has with the neighborhood (Forrest &
Kearns, 1999; Goodman & Hankin, 1984).
This sense of satisfaction with one's neighbors is in turn
dependent on a number of attributes that enhance one's feelings
toward the people around and to the environment within the
community (Fredland, 1974; Goodman & Hankin, 1984; Porell,
1982; Rossi, 1980). According to Brehm, Eisenhauer, and Krannich
(2004), most of the researchers investigated community attach-
ment and its relationship with personal and social connections,
whereas only little research was conducted on the association be-
tween community attachment and residents' satisfaction. There-
fore, this study ?lls this gap by examining such a relationship by
proposing the following hypothesis:
Hypothesis 3: A signi?cant relationship exists between community
attachment facilities and residents' satisfaction
3. Conceptual framework
The entire analysis is based on the theoretical framework. The
theoretical framework offers the conceptual foundation to proceed
with the research. Based on the literature review, this research fo-
cuses onthe conceptual framework of the residents' satisfactionwith
the facilities provided by the private housing companies in Dhaka,
Bangladesh. This framework emphasizes that variables such as
housing expenses, service quality, and community attachment fa-
cilities are independent variables that are positively related to the
satisfactionof the residents, whichwas mediated byaffordabilityand
hygienic conditions. The proposed framework is presented in Fig. 1.
4. Research methodology
Structured questionnaires were given to potential respondents in
Dhaka (capital city of Bangladesh) to obtain speci?c information. The
survey questions were set ina prede?ned order; thus, data collection
was also direct (Malhotra, 1999). The survey was self-administered.
4.1. Measures and selecting the format of responses
Because the instrument for measuring the residents' satisfaction
of their current living conditions was developed from scratch, a
M.S. Rahman et al. / Asia Paci?c Management Review 20 (2015) 130e140 132
number of stages were followed. These include the selection and
creation of items, exploratory survey, content validity, pretest, pilot
test, and con?rmatory study. All of the measures used in this study
were drawn from existing literature and were translated and
adapted to the context of this research except for measures related
to affordability and expense variable. Based on literature reviews
and the suggestions of 10 academic experts, the initial instrument
was developed. A pretest of the resulting instrument was con-
ducted with 30 respondents who were randomly selected from a
particular residential area in Dhaka. The respondents were asked to
complete the questionnaire, to determine whether they could un-
derstand the verbiage, and to suggest improvements. The pretest
participants suggested that most of the items under each construct
were understandable and categorized appropriately. In addition,
the time taken to complete the questionnaire was also established.
This study used a 5-point Likert scale, which has been accepted
by various scholars (Aaker, Kumar, & Day, 2001; Neuman, 2000).
There are a number of reasons for choosing a Likert scale as the
interval scale in this research. First, this type of scale has been found
to communicate interval properties to the respondent, and there-
fore produce data that can be assumed to be interval-scaled. Sec-
ond, in the marketing literature, Likert scales are almost always
treated as interval scales (Aaker et al., 2001). Because Likert scales
are treated as interval scales, polychromic correlations were not
used in structural equation modeling (SEM), which is commonly
applied in analysis using AMOS.
In addition, affordability was measured with an initial ?ve items
extracted from the literature review. These ?ve items were as fol-
lows: affordable or middle-income group, easy access of loan, price
of the apartment within the limit of the income, easy ?nancial
access to purchase an apartment, and third-party support to pur-
chase an apartment other than government. This scale proved to be
adequately reliable (alpha ¼0.827). Residents' expenses on housing
were operationalized using the following ?ve items: always
considering the expense before purchasing an apartment; wants to
pay extra if I am satis?ed; saving is more important than an
expense for a new apartment; dif?cult to purchase a moderate
apartment; and in?uenced by the family member to buy a new
apartment. This scale was also proved to be adequately reliable
(alpha ¼ 0.823). Service quality was operationalized using the
following ?ve items: perform the promised service dependably;
security and privacy; willingness to help building stakeholders and
provide prompt service; courtesy of employees and their ability to
convey trust and con?dence to the residents. These items were
adapted from Karsten (2007), Fitzsimmons et al. (1998), and Li and
Siu (2001). The selected scales of service quality had good reliability
(alpha ¼ 0.924). For measuring hygienic condition, the following
?ve items were adapted from literature (Coleman, 1985; Fiadzo
et al., 2001; Pickles, 1998): decency of the current living area,
spacious within my living area, healthy condition, accessible by
public transport with connections to work, and social and leisure
opportunities. These also had adequately reliability (alpha ¼0.867).
In addition, community attachment was operationalized using
the following ?ve items: satisfaction in social and neighborhood
relationships, expecting community support, community organizes
various national and social activities, feeling that you belong to the
community, and people with interests and values similar to yours.
These were adapted from the works of Gober, McHugh, and Leclerc
(1993). This scale also proved to be adequately reliable
(alpha ¼ 0.923). Finally, the dependent variable “residents' satis-
faction” was assessed using the following four items: environ-
mental quality, characteristics of household members, features
related to the housing, characteristics of the housing environment,
and the appearance of the housing environment, which were
adopted from Berkoz et al. (2009). This scale showed adequate
reliability (alpha ¼ 0.926).
4.2. Sampling procedure
Because this study investigated the resident's satisfaction of
facilities provided by private housing providers in Dhaka, we
believed that the data collected would be more reliable if the in-
formation can be directly gathered from residents of different age
groups in the Dhaka residential area. Therefore, the target popu-
lation for the survey included citizens aged 18e50 or older. The
questionnaires were distributed to the respondents according to
the number of residents in each area in Dhaka to minimize bias. The
convenient sampling method was used for this purpose. Conve-
nient sampling is most often used during the exploratory phase of a
research and is perhaps the best way of getting information quickly
and ef?ciently (Brito, Aguilar, & Brito, 2007; Carmon, 2010; Chen,
2009; Manaktola & Jauhari, 2007; Sekaran, 2000; Tih & Ennis,
2006; Tse, 1995). Data were collected from January 2012 to March
2012 by applying the convenience sampling procedure to the res-
idents in established residential areas in different parts of Dhaka
(e.g., Gulshan, Baridhara, Uttara model town, Mirpur). Following
data screening, there were a total of 600 samples, which adequately
represent the study population (Roscoe, 1975).
4.3. Data analysis procedures
The data analysis included four stages. Descriptive and infer-
ential statistical techniques were used for analyzing the screened
data. Data were coded and analyzed using the Statistical Packages
for Social Sciences and AMOS software. The ?rst stage of the data
analysis used means, frequency, and percentages to present the
respondent's overall demographic pro?le. In the second stage, an
exploratory factor analysis (EFA) was conducted to identify the
factor structure and check the validity and the reliability of the
scale. A factor was considered signi?cant if the factor loading was
H2
Resident’s satisfaction (RS)
Community attachment
(CA)
Affordability (AF)
Housing expenses (HE)
Hygienic conditions
(HC)
Services quality
(SQ)
H1
H3
Fig. 1. Conceptual framework of this study.
M.S. Rahman et al. / Asia Paci?c Management Review 20 (2015) 130e140 133
greater than 0.5 and its eigenvalue was equal to or greater than 1.
The Cronbach alpha coef?cient was used to test the reliability of the
scale. In the third stage, con?rmatory factor analysis (CFA) was
performed to con?rm the factor structure, and check the validity
and reliability of the measuring scale. The adequacy of the mea-
surement model was evaluated based on the following: overall ?t
with data, content validity, unidimensionality analysis, convergent
validity, discriminate validity, and reliability. In this study,
goodness-of-?t testing was conducted using several criteria,
including the Chi-square test, root-mean-square error of approxi-
mation (RMSEA), goodness-of-?t index (GFI), adjusted goodness-
of-?t index (AGFI), normed ?t index (NFI), and comparative ?t in-
dex (CFI), etc.
However, to test Hypotheses 1e3, the fourth part of the data
analysis identi?ed the structural relationships between housing
expenses, service quality, and community attachment with re-
gard to residents' satisfaction of the private housing providers in
Dhaka. It was hypothesized that affordability and hygienic con-
dition play a mediating role under housing expenses and service
quality.
4.4. Estimation and model ?t and absolute measure of ?t
Joreskog and Sorbom (1989) introduced two indices called GFI
and AGFI and these were used in this research. The GFI indicates
goodness-of-?t, and the AGFI attempts to adjust the GFI for the
complexity of the model. Two other well-known measures are the
TuckereLewis Index (Tucker & Lewis, 1973), better known as the
non-normed ?t index (NNFI), and the NFI, which were also used in
this research (Bentler & Bonett, 1980). The most basic measure of
absolute ?t is the Chi-square statistic. However, to assess how well
a given model approximates the exact model, we used RMSEA. If
the approximation is good, the RMSEA value should be small.
Typically, an RMSEAof less than 0.05 is required (Browne &Cudeck,
1993; Hox & Bechger, 1998).
4.4.1. Incremental ?t measures
There are many incremental ?t indices, but some of the most
famous ones are the NFI, NNFI, and CFI, and these were frequently
used in this study (Shah & Goldstein, 2006).
4.4.2. Measurement model ?t
The measurement model ?t was evaluated in two ways: ?rst by
assessing the reliability and the convergent and discriminant val-
idity of the constructs and second by examining the individual path
(parameter) estimates (Bollen, 1989). Various indices of reliability
were also computed to summarize howwell the latent variables are
measured by the mediating variables (either individually or
together). In addition, data on individual item's reliability, com-
posite reliability, and average variance were also extracted from
this research (Bagozzi & Yi, 1988; Fornell & Larcker, 1981).
5. Data analysis
5.1. Descriptive analysis results of survey and respondent's pro?le
A total of 700 questionnaires were distributed to 700 residents
in signi?cant residential areas of Bangladesh (Mirpur, Muhammd-
pur, Uttara residential area, Gulshan, and Baridhara). A total of 650
questionnaires were returned (raw response rate, 92.8%); of these,
50 questionnaires were incomplete, and were thus rejected.
Therefore, we analyzed a total of 600 usable questionnaires
(adjusted response rate, 85%).
5.2. Demographic pro?le of respondents
Among the 600 respondents investigated in this study, a ma-
jority of respondents were male (54.0%; female respondents
comprised the remaining 46.0%). Of the 600 respondents, a sig-
ni?cant number of respondents were living in Mirpur and Bar-
idhara, followed by Uttara and Gulshan in Dhaka. With regard to
the age group, a majority of respondents were aged between 20 and
29 (41.66%). There were equal proportions (25%) of respondents
aged less than 20 and aged 30e39. Therefore, from the aforemen-
tioned information it is pretty clear that most of the respondents
were between 20 and 39 years of age.
5.3. Reliability analysis results for all the attributes of the
questionnaire
The internal consistency of all the items was assessed using
Cronbach alpha. The Cronbach alpha for the overall scale (nominal)
was 0.912 (Table 1). The reliability of the overall items is in the
acceptable range, meaning that the stability and consistency of the
items were good enough for the researchers to move ahead to other
statistical tests.
5.4. Exploratory factor analysis
EFA is a widely utilized and broadly applied statistical technique
in social sciences. A total of 600 usable survey responses were
analyzed in this section. Factor analysis was used to condense the
information contained in these attributes and to con?rmthe notion
that distinct dimensions existed. To assess the validity and reli-
ability of each construct, factor analysis and reliability testing were
used. The items in housing expenses (n ¼ 5), affordability (n ¼ 5),
service quality (n ¼ 5), hygienic conditions (n ¼ 5), and community
attachment (n ¼ 5) were subjected to factor analysis. To test the
appropriateness of factor analysis, the overall measure of sampling
adequacy was calculated (0.869) using the KaisereMeyereOlkin
index, which is meritorious (Kaiser, 1974). In addition, the com-
munalities of each variable ranged from 0.54 to 0.96, with an
average value above 0.62, suggesting that the variance of the
original values was somewhat explained by the common factors.
Then, Bartlett's test of sphericity was conducted, which gave a
signi?cant Chi-square value to test the signi?cance of the correla-
tion matrix (c
2
¼ 3236.980, df ¼ 325, signi?cance ¼ 0.000). Both
tests indicated that factor analysis was appropriate for this study
(Hair, Anderson, Tatham, & Black, 1998; Tabachnick & Fidell, 2001).
After the viability of the factor analysis was determined, principal
component analysis with a varimax rotation was performed. The
varimax, rather than quartimax rotation, was adopted, because we
wanted to identify several dimensions of equal importance in the
data. Items with a factor loading of 0.60 or higher were clustered
together to form constructs and all factors with eigenvalues greater
than 1 were retained (Hair et al., 1998). As a result, ?ve stable
factors with eigenvalues greater than one (explaining 55.379% of
the variance) were derived from the analysis. The factors and their
component variables were analyzed and termed as follows: hous-
ing expenses (3 items, Factor 1), affordability (4 items, Factor 2),
service quality (3 items, Factor 3), hygienic conditions (3 items,
Factor 4), and community attachment (3 items, Factor 5; Table 2).
Table 1
Reliability statistics for all items in the instruments.
Cronbach alpha Cronbach alpha based on standardized items No. of items
0.912 0.940 29
M.S. Rahman et al. / Asia Paci?c Management Review 20 (2015) 130e140 134
5.5. Measurement of validity
Following the two-stage approach suggested by Anderson and
Gerbing (1988), this research used AMOS-7 to test the estimated
measurement model before assessing the structural relationships.
The testing model with all indicators is shown in Fig. 2. All mea-
surement scales were evaluated based on unidimensionality,
convergent validity, and discriminant validity (Anderson & Gerbing,
1988). In addition, this research also maintained validity (e.g., con-
tent or face validity and construct validity) and reliability (Table 3).
The results of the measurement models indicate that all the retained
items from the EFA provide a good ?t for each of the construct,
which had already been re?ected in the results of CFA (Table 4). This
con?rms adequate unidimensionality and convergent validity.
To examine discriminant validity, this research utilized a pair-
wise comparison of the constructs in the modi?cation indices. All
the latent attributes' correlations between constructs were found
to be signi?cantly different from each other except items A2 to A3;
HE3 to HE4; and Sq1 to Sq4. Overall, this research concluded that all
the measures demonstrated good measurement properties. Many
Table 2
Summary of exploratory factor analysis.
Factor name EV1 PV2 CV3 Component variables Factor loading
1. Housing expenses
(alpha ¼ 0.861)
6.931 26.659 26.659 Always considering the expense before purchasing an apartment 0.697
Wants to pay extra if I am satis?ed 0.739
Saving is more important than an expense for a new apartment 0.727
Dif?cult to purchase a moderate apartment 0.723
2. Affordability
(alpha ¼ 0.862)
2.094 8.056 34.715 Affordable or middle-income group 0.779
Easy ?nancial access to purchase an apartment 0.871
Third-party support to purchase an apartment other than government 0.666
3. Service quality
(alpha ¼ 0.841)
1.727 6.638 41.353 Condition of physical assets 0.679
Perform the promised service dependably 0.678
Security and privacy 0.618
4. Hygienic condition
(alpha ¼ 0.821)
1.314 5.048 46.401 Decency 0.679
Spacious 0.878
Healthy 0.618
5. Community attachment
(alpha ¼ 0.851)
1.278 4.721 55.337 Satisfaction with existing residents 0.679
Community support 0.778
Organizing various national and social activities 0.618
CV3 ¼ cumulative variance; EV1 ¼ eigenvalue; PV2 ¼ percent of variance.
Fig. 2. Hypothesized model of relationships among key variables. AF ¼affordability; CA ¼community attachment; HC ¼ hygienic condition; HE ¼ housing expenses; RS ¼ residents'
satisfaction; SQ ¼ service quality.
M.S. Rahman et al. / Asia Paci?c Management Review 20 (2015) 130e140 135
different aspects of construct validity had been proposed in the
psychometric literature (Bagozzi, Yi, & Philips, 1991). In the SEM
methods, construct validity was viewed as hypothesis testing in
which particular relations were tested (Hoyle & Smith, 1994). For
composite measures of the constructs, the summated mean scales
were calculated (Hair et al., 1998). Criterion validity was assessed by
correlation analysis in this study with the summated mean scales of
the constructs. The matrix from the correlation analysis of the
variables indicates signi?cant intercorrelations among the entire
construct.
5.6. Con?rmatory Factor Analysis
To con?rm the factor structure, CFA was performed. Overall, the
?t indices improved from the default to the revised model after
adjusting certain variables (HE, AF and SQ). The CFA results ob-
tained using AMOS are presented in Table 4. The ?t indices
demonstrated a good ?t of the measurement models to the data.
The entire model was tested based on the measurement model
previously validated fromCFA in this study (Fig. 2). The ?t indices of
the entire model were c
2
/df ¼ 2.708 (c
2
¼ 3678.133, df ¼ 1358);
GFI ¼0.931; AGFI ¼0.905; RMSEA ¼0.055; CFI ¼0.913; NFI ¼0.914
(Table 5). Although a relative Chi-square statistic (c
2
/df ¼ 2.708)
indicated a good ?t, other indices were at the lower end of
acceptable ranges to indicate a good model ?t.
To test the mediation, this research then sought to determine
the mediating role of affordability housing between housing ex-
penses and resident's satisfaction by examining the direct and in-
direct effects. This study also investigated the mediating role of
hygienic conditions between service quality and residents' satis-
faction (Chang, Park, & Cahiy, 2010). In addition, we also compared
the magnitude of total (direct and indirect) effects between
housing expenses (HE), service quality (SQ), and community
attachment (CA) and resident satisfaction (RS), respectively. The
total effect of housing expense (HE) on affordability (AF) was 0.615.
This was due to both direct and indirect (mediated) effects of
housing expenses (HE) on affordability (AF); when housing ex-
penses (HE) go up by 1, affordability (AF) goes up by 0.615. The total
(direct and indirect) effects of housing expenses (HE) on residents'
satisfaction (RS) was .539. This was also due to both direct and
indirect (mediated) effects of housing expenses (HE) on resident
satisfaction (RS); when housing expenses (HE) go up by 1, resident
satisfaction (RS) goes up by 0.539. The total (direct and indirect)
effect of hygienic condition (HC) on resident satisfaction (RS) was
0.598. This was also due to both direct (unmediated) and indirect
(mediated) effects of hygienic condition (HC) on resident satisfac-
tion (RS); when hygienic condition (HC) goes up by 1, resident
satisfaction (RS) goes up by 0.598. The total (direct and indirect)
effect of affordability (AF) on residents' satisfaction was (RS) 0.877.
That is again due to both direct (unmediated) and indirect (medi-
ated) effects of affordability (AF) on residents' satisfaction (RS);
when affordability goes up by 1, residents' satisfaction (RS) goes up
by 0.877. The total (direct and indirect) effects of community
attachment (CA) on residents' satisfaction (RS) was 0.159. This was
due to both direct (unmediated) and indirect (mediated) effects of
community attachment (CA) on residents' satisfaction (RS); when
community attachment (CA) goes up by 1, residents' satisfaction
(RS) goes up by 0.159. Therefore, we can conclude that the indirect
effects (affordability and hygienic conditions) were more dominant
than the direct effects in explaining the total effect.
5.7. Hypothesis testing
To assess the mediating effects on residents' satisfaction with
private housing providers in Dhaka and to examine the predictive
validity of the hypothesized model, decomposition of effects using
Mplus was performed. As predicted, affordability and hygienic
conditions had a signi?cant mediating effect on housing expenses
and service quality supporting H1 and H2 (Table 6). The results also
Table 3
Assessment of validity and reliability.
Types of validity
and reliability
De?nition Assessment strategies in this research
Validity The accuracy of measurement (Bollen, 1989; Davis & Cosenza, 1993). The approaches taken to scale development in the
methodology part (Churchill, 1979).
Content or face
validity
The degree to which the content of an indicator re?ects the concept
(Burns & Bush, 2000; Neuman, 2000; Parasuraman, 1991)
Ensured through in-depth literature review, feedback from
experts, pretesting of questionnaire, and con?rmatory
factor analysis.
Construct validity The degree to which a construct achieves empirical and theoretical
meaning (Steenkamp & Van Trijp, 1991)
Literature review, pretesting questionnaire, and data analysis
(EFA, CFA, and SEM).
Convergent validity The degree of association between two different measurement scales,
which are supposed to measure the same concept (Davis & Cosenza, 1993)
Data analysis (EFA, CFA, and SEM).
Discriminant validity The degree to which the measurement is different from other scales
supposed to measure different constructs (Davis & Cosenza, 1993)
Data analysis (EFA, CFA, and SEM).
Reliability A measure is reliable to the extent that is an independent, but a comparable,
measure of the same trait or construct agrees (Churchill, 1979).
Clear statement and multiple indicators in the questionnaire,
and pretesting of questionnaire.
Adapted from Lawley, M.A. (1998) e Choice of Destination in International Education: Cross National Model University of Southern Queensland, University of Southern
Queensland, Toowoomba, Queensland, Australia (along with other sources acknowledged in it).
CFA ¼ con?rmatory factor analysis; EFA ¼ exploratory factor analysis; SEM ¼ structural equation modeling.
Table 4
Con?rmatory factor analysis using AMOS.
Theoretical construct Model GFI AGFI RMSEA CFI NFI
Housing expenses Default 0.921 0.906 0.058 0.921 0.900
Revised 0.945 0.924 0.050 0.965 0.934
Affordability Default 0.940 0.900 0.061 0.910 0.904
Revised 0.970 0.941 0.041 0.964 0.961
Service quality Default 0.951 0.903 0.100 0.907 0.888
Revised 0.990 0.973 0.029 0.994 0.977
Hygienic condition Default 0.991 0.973 0.043 0.991 0.979
AGFI ¼adjusted goodness-of-?t index; CFI ¼comparative ?t index; GFI ¼goodness-
of-?t index; NFI ¼ normed ?t index; RMSEA ¼ root-mean-square error of
approximation.
Table 5
Summary of goodness-of ?t indices for full model testing.
Model c
2
df c
2
/df GFI AGFI RMSEA CFI NFI
Default 3678.133 1358 2.708 0.931 0.905 0.055 0.913 0.914
AGFI ¼adjusted goodness-of-?t index; CFI ¼comparative ?t index; GFI ¼goodness-
of-?t index; NFI ¼ normed ?t index; RMSEA ¼ root-mean-square error of
approximation.
M.S. Rahman et al. / Asia Paci?c Management Review 20 (2015) 130e140 136
showed that there is a positive relationship between community
attachment and residents satisfaction (b ¼ 0.159, CR ¼ 3.090,
p ¼ 0.002), which nearly supports H3 (Table 6).
This research was directed to explore the residents' satisfaction
with facilities provided by the private apartment companies in
Bangladesh. Dhaka was selected as the study site. The result of this
empirical test is expected to ?ll in the existing knowledge gap by
exploration of the residents' satisfaction from a developing coun-
try's perspective. Determinations from the SEM revealed that there
is a strong mediation role of the “affordability” variable between
housing expenses made by the occupiers and their overall satis-
faction. By contrast, the service quality was found to positively in-
?uence residents' overall satisfaction when hygienic condition
plays a mediation function. This means that satisfaction of the
residents with the facilities offered by the owner substantially
depends on the overall service quality of the service providers
(Amerigo & Aragones, 1990).
In view of that, to ful?ll the necessities of the residents, this
research places a few touchstones, also supported by ?ndings of
previous studies, that are considered essential for residents:
physical quality, hygienic condition, location, standard of services
offered by the owners, and neighborhood characteristics (Abdul,
2008; Chi & Grif?n, 1980; Lord & Rent, 1987).
A majority of the respondents concurred that the atonement of
their current housing place are hugely impacted by the expenses.
As a result, not everybody can enjoy comfortable housing facilities
if he/she cannot afford to make these expenses. This determination
is similar to the ?ndings by the Gubbay (1999), who indicated that
housing satisfaction among the residents depends on the low
monetary value of tenant procurement. The studies by Adriaanse
(2007) and Lu (1999) con?rmed that income of households plays
an important role with regard to the grati?cation of individual
occupants. Above all, the researchers think that residents' satis-
faction with their current living place depends on the overall
ful?llment of their needs and dreams (Abdul, 2008). Housing
environment must have a positive living environment by catering
to all sorts of social factors and economic conditions (e.g., accessi-
bility to the workplace, availability of schools and shopping mall
based on their social status; Kellekci & Berkoz, 2006; Salleh, 2008;
Teck-Hong, 2012).
Thus, it is necessary that the residents' satisfaction with the
facilities provided by the private apartment companies in
Bangladesh should be adequately monitored by the agencies con-
cerned for the overall improvement of the residents' satisfaction.
The respective units of the government should check their current
housing development policy to ensure acceptable service delivery
by the private apartment companies in Bangladesh.
6. Conclusions
In a competitive world, apartment companies need to enhance
the quality of their services to sustain their competency in the
market to retain their valuable customers by ensuring that the
apartments are affordable. Therefore, an understanding of what
drives the customer to be more satis?ed is the key element for most
of the apartment business enterprises.
The study aimed to provide an insight into the relationships
between housing expenses, service quality, and community
attachment (de?ned as HE, SQ, and CA, respectively, in Fig. 2),
which in?uence residents' satisfaction (RS). For the ?rst time, to the
author's knowledge, affordability and hygienic conditions were
considered to play a mediating role between housing expenses and
service quality.
The research also demonstrates the use of SEM approach as a
powerful tool to clarify the causal relationships between these
latent and observed factors. We hope that these new contributions
of this study will improve the understanding of those three salient
inter-related clusters that have an effect on the satisfaction of res-
idents from the perspective of a developing country.
Based on literature review, the study results show that all the
three hypotheses postulated were acceptable. More importantly,
the ?ndings of this study suggest that there is a strong relationship
between service qualities (SQ) and residents' satisfaction (RS) when
hygienic conditions (HC) play a mediating role. This study also
con?rms that there is a signi?cant relationship between housing
expenses (HE) and residents' satisfaction (RS) when affordability
(AF) plays a mediating role. In addition, the result also con?rms that
community attachment (CA) has a weak relationship with the
residents' satisfaction (RS) level.
7. Managerial implications
The proposed model suggests that residents in Dhaka, capital of
Bangladesh, who are living in an apartment, expect their provider
to ensure all the facilities provided have decent living conditions.
The satisfaction of residents with the apartment owner starts from
the very beginning when the customers intend to purchase using
their savings (Freeman et al., 2000; Hancock, 1993). It seems very
logical to think that after buying an apartment the residents do
expect that certain services to meet their safety and social needs are
actually available in their locality.
Thus, collective efforts are very much essential for apartment
owners in Bangladesh. The mediating roles such as affordability
and hygienic conditions in their current living area are also
important. Along with housing expenses and the affordability of
the general customers, the apartment owners must also ensure
proper infrastructure and building services systems to gain the
trust and con?dence of residents. In addition, they must also
ensure that the living conditions provided have privacy and are
decent, secure, spacious, healthy, affordable, and with legally
secured tenures (Bonnefoy, 2007; Fitzsimmons et al., 1998; Li &
Siu, 2001; Zubairu, 2002). Each company in a developing coun-
try is constrained by limitations on the resources that are avail-
able. Therefore, the developer must plan accordingly to best
deploy the scarce resources in order to achieve the highest level of
customer satisfaction. Thus, priorities have to be set. Finally, this
Table 6
Estimates of the mentioned variables.
Path Estimates of
regression weight
Standard error of
regression weight
Critical ratio for
regression weight
p (level of signi?cance
for regression weight)
Affordability housing expense 0.615 0.119 5.149 0.000
Hygienic condition service quality 2.474 0.582 4.250 0.000
Residents' satisfaction hygienic condition 0.598 0.089 6.688 0.000
Residents' satisfaction community attachment 0.159 0.052 3.090 0.002
Residents' satisfaction affordability 0.877 0.192 4.564 0.000
M.S. Rahman et al. / Asia Paci?c Management Review 20 (2015) 130e140 137
research suggests that apartment developers should seriously
consider these things before selling an apartments; otherwise,
their reputation is affected, which is somehow re?ected by
customer loyalty.
8. Limitation and further study
Although this research study provided meaningful results, it is
not without limitations. First, the model chosen does not compre-
hensively re?ect various factors such as residents' perception and
experience. In addition, price of the apartment and government
intervention were not considered. Thus, it is suggested that these
factors are included in future research. Second, the data were
collected only once in a particular year for 3 months, whereas if
data were collected on a year-on-year survey, the research could
make a comparative study of the structural change in the residents'
satisfaction of the facilities provided by private apartment pro-
viders. However, because of practical problems (e.g., time con-
straints), this research did not use longitudinal research (Pettigrew,
1990).
Nevertheless, this study is the ?rst of its kind, to the best of our
knowledge, conducted on the customers of the Bangladeshi hous-
ing industry. In the future, further research should be conducted
using SEM to examine the relationship between customers' satis-
faction and other variables using an additional sample with
comprehensive statistical analysis including the moderating effects
of demographic items. As a whole, this research posits that the
potential buyers would consider the corresponding factors when
purchasing an apartment.
Con?icts of interest
All contributing authors declare no con?icts of interest.
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