PAYA LEBAR MILITARY AIRBASE EFFECTS ON PRIVATE NON-LANDED RESIDENTIAL PROPERTY PRICES

Abstract

The objective of this paper aims to understand how private non-landed residential property price reacts to the proximity of an airbase. Through the Singapore National Day Rally in 2013, it had been announced that Paya Lebar Airbase will be relocated by 2030, and the land to be redeveloped. The study uses econometric models and estimates the pricing premium through a hedonic pricing model, analyzing the distance and announcement effect of the transaction data of private non-landed residential property within a 5 kilometers’(km) radius. It was found that there was an average of 0.3% premium in price for every km away from the airport. While the study of the announcement effect found that properties transacted after the announcement received an average premium of 13.2%, suggesting that the presence of an airbase has a negative effect on property prices.