IMPACT OF PROXIMITY TO UNDERGROUND EXPRESSWAYS ON PRIVATE NON-LANDED RESIDENTIAL PROPERTY PRICES

Abstract

This dissertation is motivated by URA’s approach to further expand Singapore’s existing physical capacity by building downwards. The Geylang and Marine Parade planning regions were selected as the study area as they are situated immediately next to the underground section of Kallang-Paya Lebar Expressway (KPE). A hedonic price model was employed in this study to determine the explicit impact of introducing the underground expressway on private non-landed residential property prices. We hypothesized that prices would increase with proximity to the underground expressway due to the enhancement in connectivity with the negative externalities that typically accompany its aboveground counterparts mitigated by its subterranean development. Our findings are somewhat mixed. House prices increased by only 0.0288% during the construction phase of the KPE, which suggests that the strategic relocation of certain undesirable land uses belowground did not create substantial dis- amenities during the building period. After the operation of the KPE however, housing prices experienced an increment of 0.0312% for every one meter increase from its nearest entry or exit point to KPE. Anecdotal observations lead us to posit that a congestion issue arising from the additional highway, which potentially redirected traffic into the neighborhood, had resulted in a price discount for proximity to the KPE entry/exit points. Our findings highlight the importance of thorough planning in urban intensification projects and correspondingly the need for adequate support infrastructure provision, particularly public utilities, to cater for the increased population. Also, valuers should be mindful of negative externalities introduced on the surface by subterranean infrastructures.