BRINGING THE PARK INTO THE HOME: THE VALUE OF GREENERY IN CONDOMINIUMS

Abstract

Greenery is an attribute that is gaining focus today as more people recognise that it needs to be preserved amidst rapid urbanisation and development.

This dissertation aims to determine the price premium that greenery brings to a condominium, and if condominiums with more greenery display a price premium over other condominiums with less greenery. The confirmation of this would testify that the proximate principle applies even if the greenery is within the residential compound. It is hypothesised that there is a positive relationship between the area of greenery in a condominium project and the resale price of its units.

The hypothesis will be tested using hedonic regression analysis of 132 sets of resale housing transactions from 12 selected condominiums in District 15.

The study finds that units in condominiums with greenery do enjoy a price premium, and that there is a higher price premium if the condominium has more greenery. The premium is discovered to be $1.13psf of the condominium unit. However, the price premium caused by greenery is less than that of other facilities. This could be due to buyers’ lower expected utility of greenery, leading to their lower willingness-to-pay (WTP) for the facility, as shown by the survey results.