The Bangko Sentral ng Pilipinas (BSP) announced that it is targeting to release a commercial property price index, which will complement its residential real estate price index (RREPI), within the year.
In a media briefing on Thursday, BSP Governor Benjamin E. Diokno said the new index will allow the BSP to expand its monitoring of price trends and financial exposures of banks to the property sector.
“Together, these two indicators may be used to monitor the developments in the Philippine property sector as a whole and their linkages with the other sectors in the economy,” Diokno said.
The BSP’s RREPI, which was first published in 2016, was developed in response to the scarcity of official data on the Philippine property sector.
It serves as an indicator of change in the prices of residential properties in the Philippines over a period of time. The growth rate of the index measures house price inflation.
A rising RREPI denotes rising residential prices on average, while a declining RREPI indicates the reverse.
“Using RREPI data, the BSP is able to measure and monitor the banking sector’s exposure to the residential property sector, monitor developing price and credit trends, and develop timely and appropriate policies, together with other regulatory agencies, if needed, to stem the rise of systemic risk,” Diokno said.
“As such, it is imperative for policy-makers to possess timely, relevant and accurate data on financial exposure of banks, as well as price trends, in the property sector of a country.”
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