Please use this identifier to cite or link to this item: https://scholarbank.nus.edu.sg/handle/10635/221638
Title: EFFECT OF NEW ELIGIBLE FLATS ON THE PRICES OF EXISTING OLDER FLATS IN MATURE ESTATES
Authors: LEE HUI JING CRYSTAL
Keywords: Real Estate
Lum Sau Kim
RE
2017/2018 RE
Issue Date: 15-May-2018
Citation: LEE HUI JING CRYSTAL (2018-05-15). EFFECT OF NEW ELIGIBLE FLATS ON THE PRICES OF EXISTING OLDER FLATS IN MATURE ESTATES. ScholarBank@NUS Repository.
Abstract: New residential properties can have positive or negative spillover effects on prices of existing flats. In Singapore’s unique public housing sector, flats that have just fulfilled their Minimum Occupation Period (“MOP”) are considered as new flats in the resale market. Considering both the existence and transaction quantity of new eligible flats, this is the pioneering research in the field that seeks to empirically investigate the impact of the former on the resale prices of existing flats in mature estates. Specifically, this paper aims to discover whether a magnitude difference exists in the effect between younger and older flats. Hedonic pricing method was utilized in the empirical study to isolate the impact of new eligible flats on the prices of existing flats. Empirical results suggest that the mere existence of new eligible flats increases the resale price of an existing flat by 1.85% and each new eligible flat being transacted is expected to increase the resale price by 0.04%. Meanwhile, the existence of new eligible flats is found to have greater magnitude effect for older existing flats than younger existing flats. However, quantity of new eligible flats being transacted has a greater magnitude effect on the prices of younger existing flat than older existing flat. Each new eligible flat increases the transaction price of existing younger and older flats by 0.08% and 0.04% respectively. Furthermore, price indexes analyses were conducted to obtain a clearer understanding of the price dynamics between new eligible flats and oldest group of existing flats. Counter-intuitive observations in the price movements illustrated the need for public housing policies and pertinent events to be taken into consideration.
URI: https://scholarbank.nus.edu.sg/handle/10635/221638
Appears in Collections:Bachelor's Theses

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