Interpretive-Structural Modeling of Behavioral Biases of Housing Sector Investors

Based on studies, the housing market, much like financial markets, does not always behave rationally. Various behavioral biases are observed in the housing market at different times, contrary to market norms. Studying these behavioral biases, alongside other decision variables and economic policies, will enhance understanding and improvement.To achieve this, initially, defined biases were collected through literature reviews, and the impacts of the identified biases were discovered using the Delphi method. In the second phase, a canonical group composed of experts in behavioral finance and housing identified ten influential biases on housing market investors based on Delphi results and a comprehensive definition synthesis.Finally, based on an interaction matrix derived from the opinions of 13 experts, a five-tier model was drawn using the interpretive-structural method. In this model, at the fifth level, we Confirmation Bias and Overconfidence; at the fourth level, Endowment Bias; at the third level, regret aversion, social interactions(Herd Behavior) and self-attribution; at the second level, Conservatism Bias; and at the first level, Framing Bias, overreaction, and anchoring and adjustment