Aging like fine wine: a Singapore public housing story

Author

Start Page / End Page

Volume

Issue Number

Year

Publication

LI Bingqiao, Fei GAO, Seck Tan

95 / 126

26

1

2023

International Real Estate Review

 

Abstract

This paper examines the unique context of the public housing resale market in Singapore over a 29-year period (1990 to 2018). We find that, on average, there is a price premium for housing units with a longer-term lease. This premium effect is significant and nonlinear after controlling for size, floor level, macroeconomic conditions, as well as year and location fixed effects. Specifically, the town and street fixed effects address the concern that older (but established) districts are characterized by more reputable schools and infrastructure such as health care offerings and shopping malls, while developing districts have innovative facilities with a fresh contemporary outlook as that of modern satellite towns. We document a different lease premium in mature towns as compared to that of the new towns, which captures the different concerns of buyers in combination with location and other characteristics of the houses.

 

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Keywords

Singapore, Public Housing, Resale Price, Lease Premium