IMPACT OF ARCHITECTURAL HERITAGE AWARDS ON RESIDENTIAL PROPERTY PRICES

Abstract

Being a small city-state with limited land resources, Singapore is confronted with the pressures of allotting sufficient for land for redevelopment and the need for conservation. However, there seems to be a good balance between these two uses through a rigorous local conservation program. On top of gazetted areas and individual buildings, there is an award, the Architectural Heritage Award, given by the Urban Redevelopment Authority annually to buildings that display outstanding practices in the spirit of conservation. At present, the effects of conservation and architecture awards are assessed separately. This paper hence seeks to add on to the pool of literature by quantifying the economic spillovers of a scheme that encompasses conservation and architecture. This research contends that the award has a positive effect on private and public residential property prices. To examine the effect, the Difference-in-Differences estimator approach was adopted, using a 20-year study timeframe. Positive and significant spillovers were found for the private properties, but insignificant and negative effects were estimated for the HDB flats. The results suggest that homebuyers may have a preference for homes in the private market and are willing to pay a higher price to reside in these areas. Goodness of fit and falsification tests were conducted to determine the robustness of the main regression models, where the results reinforce the empirical findings. The governing body in charge of the local conservation scene, property developers and individual home and conservation property buyers may find this study useful in guiding their policy, investment and purchasing decisions respectively.