THE IMPACT OF THE HAWKER CENTRES UPGRADING PROGRAMME (HUP) ON RESALE HDB PRICES

Abstract

This research paper posits that hawker centres that underwent the Hawker Centres Upgrading Programme (HUP) have an impact on prices of surrounding Housing & Development Board (HDB) resale flats. Hence this research seeks to find out whether there is a price premium or price discount attached to HDB flats after the completion of HUP. Next, it seeks to find out if the distance to the hawker centres studied will affect the type and extent of price impact.

Firstly, a local-polynomial regression-based approach was utilized to determine a cut off boundary of 500 metres from the nearest hawker centre. Following which the treatment and control groups were derived and the difference-in-differences (DID) model was then applied to a total of 478,111 HDB transactions ranging from January 1997 to November 2017.

The study concludes that HDB flats within a 100m radius of a Hawker Centre that underwent the HUP commanded an average price premium of 13.8% after the HUP was completed. Similarly flats that are within the 100 – 500m radius enjoy a price premium of 6.95% but it is lower than that of flats within the 100m radius.