ACCESS TO CHILD CARE CENTRES AND NEIGHBOURING HOUSING PRICES

Abstract

With increasing number of dual income married couples, there is a growth in demand for quality child care services. Nevertheless, children will eventually outgrow their need for child care services and there are negative externalities associated with child care centres. In addition, location and quality are some of the innate considerations when parents are selecting a child care centre for their children. Thus, these various factors may have spillover effects on neighbouring housing prices. This study seeks to understand how accessibility to child care centres affects neighbouring home prices. The impact of accessibility to quality child care centres on home prices will also be examined. Finally, this paper will study whether percentage of children in a planning subzone has any effect on the relationship between accessibility to a quality child care centre and housing prices. Using hedonic price model, the results show that accessibility to child care centre in general influences housing prices positively. Houses located within 200 metres of a child care centre have positive price effect of 2.9%. On average, increase in 100 metres away from nearest child care centre will decrease home prices by 3%, other variables being equal. There is no empirical evidence to show that quality child care centre has effect on housing prices. On the contrary, normal child care centre in proximity reflected a premium on housing prices. Lastly, homes in subzones with higher percentage of children command higher property values when it is located within 200 metres of a quality child care centre.