POLITICAL INFLUENCE ON PUBLIC RESIDENTIAL HOUSING PRICE

Abstract

There are benefits often associated with living in the constituencies of the ruling party. An example of such benefits is the upgrading programme. Studies have shown that upgrading programmes that aim to improve living conditions have also helped to enhance property values. However, the opposition constituencies are deprived of such opportunity because priority is given to HDB flats under the control of the People Action's Party (PAP). This study provides an empirical evaluation on the impact of opposition constituencies as a form of an externality upon public residential housing price. Using hedonic pricing model, the multiple regression analysis revealed that HDB flats in opposition party electorates fetch a significantly lower price after controlling for other pertinent variables. However, there is lack of statistically significant evidence to show that the housing price changes continuously across the electoral boundaries.