Within-development density and housing prices in Singapore

This paper measures how much more households pay for less density in their immediate surroundings. Using transaction and administrative data and exploiting the introduction of a regulation that restricted the number of housing units for certain land lots, we find that households discount density: a...

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Bibliographic Details
Main Authors: FESSELMEYER, Eric, LIU, Haoming, POCO, Louisa
Format: text
Language:English
Published: Institutional Knowledge at Singapore Management University 2023
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Online Access:https://ink.library.smu.edu.sg/cis_research/143
https://ink.library.smu.edu.sg/context/cis_research/article/1142/viewcontent/MainDocument___deanonymised.pdf
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Institution: Singapore Management University
Language: English
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Summary:This paper measures how much more households pay for less density in their immediate surroundings. Using transaction and administrative data and exploiting the introduction of a regulation that restricted the number of housing units for certain land lots, we find that households discount density: a 10% increase in within-development density decreases the price per square meter by 5%. Further, the mean price per square meter of the average development increased by 1%–3% after the regulation was introduced, while the amount of built-up space remained constant. The increase in total revenue suggests developers may underestimate the externality caused by density.