IMPACT OF FENG SHUI ON CONDOMINIUM PRICES IN SINGAPORE

Abstract

In this modern day and age, superstitious beliefs are considered one too many and man has moved on from such “associative thinking”. However, particularly in certain aspects of real estate, such beliefs do play a part in affecting the micro-economic movements of properties in the real estate market.

The emergence of geomancy, also known as ‘Fengshui’ to the Chinese, plays a significant role in this aspect. Such traditions are slowly being adopted by the west, and demand for it has been consistently growing. Homebuyers take into account such factors in their decision on whether to purchase a house. However, many still deem this as a fallacy and are unaffected.

Hence, this study aims to examine the effects of Feng Shui on the property housing prices from the homebuyer’s perspective. This proposition is done by analyzing price discrepancies between property prices with the various Feng Shui metrics, such as the values of ‘4’ and ‘8’, and also conducting a survey on consumer sentiment on their perspective of Fengshui in accordance to age.

This research includes the use of a multivariate regression analysis to explore the effects of Lucky numbers on the effects of condominium prices. The results suggest that Fengshui has an impact on housing prices, with a 0.9% premium on ‘Lucky’ numbers and 1.6% discount on ‘Unlucky’ numbers.

A survey is also conducted to investigate the consumer sentiments of Singaporeans with regards to Fengshui being a factor of consideration when purchasing properties. The results show that while 85% of the respondents know about Fengshui and 65% believe in it; about 60% of Fengshui believers would not be willing to pay for a consultation with a Fengshui master due to the additional costs involved.

This research seeks to bring out the importance of Chinese cultural beliefs as a factor of consideration when purchasing properties and how it can be quantified with respect to other housing attributes.