Hedonic Price of Housing Space

This paper estimates hedonic prices for different levels of housing space, by exploiting a unique space-adding project in Singapore that added a uniform amount of space to each existing housing unit regardless of the original size. This space adding program was carried out if sufficient residents vote in favour of space adding. Using a difference-in-differences strategy after restricting our sample to narrow margins around the voting cut-off, we find that the additional space increased the resale price of a housing unit by 7% on average, and the extent of price appreciation varied significantly across the original size of the units.

Agarwal, Sumit and Chen, Yanying and Li, Jing and Tan, Yi Jin, Hedonic Price of Housing Space (August 15, 2019). Available at SSRN: https://ssrn.com/abstract=3440448 or http://dx.doi.org/10.2139/ssrn.3440448