IMPACT OF POLYCLINICS ON SURROUNDING RESIDENTIAL VALUES

Abstract

Despite the integral role public polyclinics play in the healthcare system, the effects of polyclinics on surrounding residential values has often been a topic less explored compared to various other healthcare facilities. With the supply of polyclinics expected to increase significantly in the near future, the issue of NIMBY may pose as a concern given the existing negative perceptions on certain healthcare facilities. This study attempts to examine the general impact of polyclinics on the transacted HDB resale prices through the use of hedonic pricing model as the main statistical approach. Based on 57,505 HDB resale transactions from January 2015 to December 2017, it was found that HDB units located 1 kilometre closer to a polyclinic will face a price premium of 2.8%. Through the use of a non-linear model specification, it was also determined that polyclinics generally have a non-linear effect on property prices. The study also examined the impact of the elderly population in a neighbourhood on the resale values of housing properties in proximity to polyclinics. The results illustrated that a 1% increase in elderly population in a town would enhance the property values by 0.0024% when located 1 kilometre closer to a polyclinic. In addition, the paper also investigated the quality of polyclinic and the extent of influence it has on the impact on property prices. Through the use of two indicators to determine the quality of polyclinic – namely the polyclinic cluster group and waiting times in a polyclinic, it was found that units located 1 kilometre nearer to a National Healthcare Group (NHG) polyclinic would face a price discount of 1.17%. Furthermore, a 1-minute increase in waiting time at the median or 95th percentile would lead to a 0.163% and 0.028% price premium respectively, for properties located 1 kilometre nearer to a polyclinic.