UNCERTAINTY OF TRAVELING TIME ON HOUSING PRICE IN SINGAPORE

Abstract

Travel time variability is a source of disutility which impairs commuters’ ability to forecast the duration of their trip and hence creates uncertainty to the commuters. With increasing recognition of the importance of reliable traveling time, this paper contributes by studying the role of uncertainty in influencing housing price hence facilitating the direct computation of the marginal value of reliability of traveling time. Using the Geographic Information Systems’ (GIS) heatmap plugin, this paper examines how dispersion of travel times to workplace during morning peak affects the prices of Housing and Development Board (HDB) flats in Singapore. The results indicate that the dispersion of daily average traveling time has an effect on housing prices. The standard deviation of daily average traveling time to the employment centre(s) is inversely related to housing price in Singapore. Thus, the results clearly suggest that travel time uncertainty plays an important role in influencing housing price.