New RREPI shows no hous­ing bub­ble in Philip­pines–BSP

Business Mirror - - BANKING&FINANCE - Bianca Cuaresma

THE Bangko Sen­tral ng Pilipinas (BSP) rolled out the maiden re­sults of the much-awaited Res­i­den­tial Real Es­tate Price In­dex (RREPI)—show­ing a high sin­gledigit growth of res­i­den­tial real- es­tate prices in the first quar­ter of the year, com­pared to year-ago lev­els.

Re­sults showed the RREPI in­creased 9.2 per­cent in the first quar­ter of the year—with con­do­minium unit prices driv­ing the growth dur­ing the pe­riod.

“We be­lieve there’s no real- es­tate bub­ble right now, but we want to con­tinue to mon­i­tor the prop­erty sec­tor,” cen­tral bank Gover­nor Amando M. Te­tangco Jr. said.

“The 9.2-per­cent growth rep­re­sents a vi­brant hous­ing in­dus­try in the Philip­pines, and the ro­bust­ness of this con­clu­sion is con­firmed by the trends in consumer prices, as well as the re­cent re­sult of the consumer ex­pec­ta­tion sur­vey,” said Diwa C. Guini­gundo, cen­tral bank deputy gover­nor for the mon­e­tary sta­bil­ity sec­tor.

The BSP said con­do­minium units posted the high­est year- on-year growth in prices at 12.9 per­cent, fol­lowed by town­houses at 8.5 per­cent.

Asked if the cen­tral bank is alarmed by the rel­a­tively el­e­vated growth rate of con­do­minium prices, Te­tangco said: “Not at all. They’ve some­what slowed down in build­ing. We want to look at the to­tal pic­ture. At this point in time, con­do­mini­ums, if you look at other in­di­ca­tors, like build­ing per­mits, there’s no bub­ble.”

Ge­o­graph­i­cally, ar­eas within and ar­eas out­side the Na­tional Cap­i­tal Region (AONCR) rel­a­tively fol­low the same level of growth.

Real-prop­erty prices in the NCR in­creased 9.7 per­cent, while prices in AONCR in­creased by 9.4 per­cent.

Quar­ter-on-quar­ter, mean­while, RREPI grew by 1.9 per­cent—with prices of real es­tate be­ing driven by growth in AONCR at 4.2 per­cent. Prices in the NCR, mean­while, posted a quar­ter- on- quar­ter de­cline of 0.2 per­cent.

The RREPI mea­sures the av­er­age changes in prices of dif­fer­ent types of hous­ing units over a pe­riod of time, where the growth rate of the in­dex mea­sures house in­fla­tion.

The con­struc­tion of the RREPI is based on banks’ ap­proved hous­ing-loan ap­pli­ca­tions.

Out of the 109 banks cov­ered, 93 banks, or 85.3 per­cent, sub­mit­ted their re­ports for the first quar­ter of the year.


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