The Pricing of ‘Luckiness’ in the Apartment Market

Abstract

People are willing to pay a premium for a ‘lucky’ property. In a Cantonese prevailing society such as Hong Kong, many people regard the number ‘8’ as lucky since 8 has similar pronunciation as prosperity in Cantonese. Therefore, a lucky floor number is a valuable attribute. Although not all Cantonese are superstitious about the luckiness of the number 8, it is an added benefit that no Cantonese will reject. A hedonic price model is estimated using transaction data during the booms and slumps of the property market. The results show that flats with lucky floor numbers are sold at a significantly higher price during property booms than during property slumps.