Upgrading programme in public housing: an assessment of price and liquidity enhancements

Upgrading programmes that aim to improve living conditions and enhance property values are often evaluated qualitatively. We propose a methodology for determining the market impacts of such projects and apply it for assessing the Main Upgrading Programme (MUP) in Singapore. This is a systematic S$15 billion project undertaken since 1992 to improve the condition of older public housing units. Both price and liquidity effects are examined. We find evidence that the programme has achieved its objective of value enhancement. Units that have completed upgrading fetch a significantly higher price while units that have been selected and successfully polled for upgrading fetch a small price premium. However, units undergoing upgrading sell at a statistically insignificant discount, ostensibly due to the disutility associated with construction. The MUP has little impact on the saleability of upgraded flats. The trade‐off in liquidity is seen only for units that have completed MUP. These take a longer time to sell.