THE EFFECTS OF URBAN MOBILITY IMPROVEMENTS ON HOUSING PRICES

Abstract

Singapore’s push towards a Smart Nation is the focus of many of the development concepts today. One of the pillars of focus of the Smart Nation Initiative is building a Smart and Sustainable Singapore and a vision of a “Car-Lite Singapore”. In light of Singapore’s goal to phase out diesel and fuel vehicles by 2040, Singapore announced the first test-bedding of a Car-Lite precinct in Ang Mo Kio. This encompasses reducing car lanes and increasing infrastructure to encourage walking and cycling. Under the Walking and Cycling Initiative, dedicated cycling paths were constructed in Phases in Ang Mo Kio with Phase 1 completion announced in July, 2016. While the main purpose of cycling paths is to increase mobility and accessibility, there are underlying effects on its impact to housing values. Despite studies on the impact of cycling paths to housing values from other parts of the world, none of the studies analyze the impact of cycling paths on HDB resale prices. The recent plans to build a Car-Lite Singapore means that there is a lack of research done on the impact of Car-Lite precincts to housing values.

This paper aims to fill in the literature by examining the impact of cycling paths to HDB resale prices and determine Singaporean’s preferences towards a Car-Lite precinct. Through a hedonic pricing model and a Difference-in-Difference hedonic regression, HDB housing units in planning areas with cycling paths and a high density of cycling network have obtained a statistically significant price appreciation of 0.95% while housing values of HDB units in the treatment zone of Ang Mo Kio have obtained a statistically significant decrease in HDB resale price by 0.98%, concluding that Singaporeans perceive Car-Lite precincts positive generally, but the effects are highly heterogeneous across regions, and take some time to materialize.