The non-linearity of hospitals’ proximity on property prices: experiences from Taipei, Taiwan

Abstract

Given the semi-obnoxious characteristic of hospitals, either being right next to hospitals or being too farther away without easy medical access indicates inconvenience to residents. Quantile regression is applied to examine the potentially non-linear effects of hospital spline distance on quantiles of property prices in Taipei Metropolis, Taiwan. The conventional continuous distance (from property to hospital) showed consistent negative impact on property prices, implying hospitals as amenities as generally believed. Nevertheless, the splines of hospital distance demonstrated a non-linear effect on property prices: the positive effect of spline k1 (0–500 m) on property prices indicates farther away from the hospital, higher the prices, possibly due to stronger negative externalities; the negative impact of spline k2 (500–1000 m) on property prices implies the negative impact of hospitals wears off as the positive impact reveals itself gradually; thus, the property prices fall as the distance increases; splines k5 (2000–2500 m) and k6 (2500–3000 m) also demonstrated significant negative effects. In short, hospitals would only be highly evaluated in a ‘close-but-not-too-close’ geographic location. From urban planning perspective, hospitals, which are crucial in ageing societies, may reduce its externalities by creating spatial barriers such as scenic roads to keep distance from adjacent properties.

Keywords:

• semi-obnoxious facility
• hospital
• spline function
• quantile regression
• Taiwan

Disclosure statement

No potential conflict of interest was reported by the authors.

Notes

1. In Taiwan, the proportion of elders swells to 12% in 2014 and is predicted to be 41% in 2060. In 2011, the times of doctor appointment and the days of hospital admission were on average 15.7 and 1.43 per person, respectively, based on the report of Ministry of Health and Welfare. See http://www.nhi.gov.tw/epaper/ItemDetail.aspx?DataID=3327&IsWebData=0&ItemTypeID=3&PapersID=289&PicID (accessed 29 December 2014).

2. Please refer to: http://news.ltn.com.tw/news/business/breakingnews/1166152 (accessed 20 May 2015).

3. Residents at Da-An County, Taipei, filed a petition in 2012 against the establishment of a hospital in neighbourhood because of the worries of disease spread and other kinds of annoyance. See http://news.ltn.com.tw/news/focus/paper/599794 (accessed 20 May 2015).

4. National Statistics of Taiwan: http://statdb.dgbas.gov.tw/pxweb/Dialog/statfile9.asp.

5. The unit measurement of land or floor size in Taiwan is ‘ping’. 1 ‘ping’ = 3.3058 m² = 35.5832 sq. ft.

6. MRT in Taiwan or Singapore, a type of high-capacity public transport that operates on elevated electronic railways, is also known as subway in United States or underground in United Kingdom.

7. It may indicate that lower quantile house prices (Q10–Q20) tend to be responsive to relatively high proximity to hospitals, which is partly supported by the findings in Model 4 that in the 10th and 20th quantiles, splines k1–k5 were all significant except spline k6 (2500–3000 m), which was insignificant on these two quantiles, but significant on the rest of the quantiles (Q30–Q90).

8. The elders account for 25.8% of total population in Japan, 21.1% in Germany, 18.3% in France and 14.5% in United States; see http://money.usnews.com/money/retirement/slideshows/10-rapidly-aging-countries (accessed 20 January 2015).

Additional information

Funding

This work was supported by the Ministry of Science and Technology, Taiwan [grant number 102-2410-H-259 -049].