THE INFLUENCE OF AN MRT STATION ON RESIDENTIAL PROPERTY VALUE : A �TIMELINE � PERSPECTIVE

Abstract

This study seeks to examine the influence of the introduction of a Mass Rapid Transit (MRT) station on residential property price throughout three time periods — the pre-construction, construction and post-construction of the station. A controlled study, with respect to these stages, was conducted on the recently completed Pioneer MRT Station. It observed the differences in resale prices experienced by two public housing precincts — one located next to the station and the other located beyond the influence of the station. Hedonic Regression was utilized in the empirical study to isolate the influence of the station’s presence on housing price. Three hedonic equations were estimated, each representing one time period, to uncover the station’s impact during the different stages. It was hypothesized that the station’s presence would bring about a positive premium for residential units within its influence. However, these units might experience a drop in premium, or even a discount, during the construction phase due to the negative externalities incurred. Results from the pooled linear regression showed that properties within the station’s influence enjoyed a price premium throughout all three stages, with the highest (22.6%) during the pre-construction stage. This premium dropped to 6.61% during the construction stage and rose marginally to 7.14% upon its completion. These findings would aid the valuation of residential units impacted by upcoming stations. This study, to the best of the author’s knowledge, is the first formal local assessment of an MRT’s temporal impact on residential price. Further research could enhance the findings.