Everyone knows location, location, location helps determine the value of a house. But who knew that truism extended to your exact street address?
That’s the conclusion of trio of economists writing in the journal Economic Inquiry.Nicole Fortin, Andrew Hill, and Jeff Huang report that “superstitious beliefs associated with fateful Chinese numbers” can have “significant effects on house prices in a North American residential market with a substantial ethnic Chinese presence.”
The economists gathered data nearly 117,000 home sales in the greater Vancouver area from 2000 to 2005. They found that, in neighborhoods where the percentage of ethnic Chinese residents was above the 18 percent regional average, houses with addresses ending with a “4” sold, on average, at an $8,000 discount.
A few cities have passed laws allowing homeowners to change their “unlucky” numbers for a fee. While this could potentially cause confusion, it might also be an unexpected source of revenue for local governments.
On the other hand, homes with addresses ending with an “8” were sold at about a $10,000 premium.
“The pronunciation of the word for “four” is very similar to the word for “death” in Mandarin, Cantonese, and several Chinese dialects,” the researchers note. “Conversely, the word for “eight” is phonetically similar to the word for prosperity or wealth.”
The researchers find similar price effects in other neighborhoods, “but only for repeated sales consistent (with) speculative behavior.”
“These effects persist long after the arrival of the new immigrants,” they write. “Whether they will extend to the second-generation immigrants … remains an open question.”
Also uncertain: Whether this effect extends to other North American cities with sizable Asian populations. “It would not be surprising to find similar discounts and premiums in these locales,” they add.
It’d also be interesting to track the value of houses with the address “13,” a number associated with bad luck among many Westerners.
The researchers note that, in response to this trend, a few cities have passed laws allowing homeowners to change their “unlucky” numbers for a fee. While this could potentially cause confusion, it might also be an unexpected source of revenue for local governments.
You might even consider them lucky.
