PLACES OF WORSHIP AND THEIR IMPACT ON PROPERTY VALUES

Abstract

Does it pay to be near God? This study seeks to address the issue of whether places of worship, positively or negatively affects the value of HDB flats, in Singapore. The hypothesis is tested with a hedonic pricing model, using a sample of 1,666 sales transactions from the HDB town, Jurong East, located in the western part of Singapore. In particular, this study examines the magnitude and direction of the impact of proximity to Chinese Temple, Hindu Temples, Christian Churches, and Islamic Mosques, and whether it varies with proximity and the type of places of worship. Findings show that proximity to churches, Islamic mosques, and Hindu temples have a positive impact on property values, while Chinese temple is the only place of worship that is viewed as a negative externality. The magnitude of the impact of places of worship on property values is found to vary across the different places of worship as well as distance from the place of worship. Thus, it shows that it not only pays to be spiritually near God but it also pays to be physically near God in terms of proximity to places of worship. This study has significant and useful implications on urban planning issues and real estate appraisals.