Does Climate Change Affect Real Estate Prices? Evidence from Government Announcement

This paper investigates the relationship between climate change information and property prices. We employ datasets of home transactions and a novel climate change information shock in Singapore, the sea level rise (SLR) projections announced by the government. Based on Difference-in-Differences estimations, we find that public properties in SLR areas experienced a 2.5% decline in price after the announcement, while private properties prices did not respond, relative to their respective control groups. We also show leasehold properties were more affected by the shock, and we estimate lower long-term discount rates further incorporated with climate risks.