[url]http://www.straitstimes.com/archive/thursday/premium/top-the-news/story/private-property-price-tracker-under-review-20141204[/url]

[B][SIZE=5]Private property price tracker under review[/SIZE][/B]

Published on Dec 4, 2014 12:58 AM

By Rennie Whang


A WIDELY watched index used to track prices in the private property sector may be revamped to give a more up-to-date picture of the market.

There has been concern that the property price index (PPI), as it is called, does not give an accurate snapshot because it does not take into account the different type of units available, their size and quality. There are also too few transactions included.

The index, last modified in 2000 by the Urban Redevelopment Authority (URA), is also issued quarterly, which some say hinders its ability to be timely in a fast-changing market.

URA said yesterday that it is reviewing the need to revise it, in line with the revision of the Housing Board's resale price index (RPI). It added that reviews are done "periodically... to understand other ways of computing property price indices and ascertain the robustness of the PPI".

The review will take time as the index is more complex, a spokesman said. "Unlike the RPI, the PPI is computed for both completed and uncompleted units. Additionally, there is greater diversity in private housing."

The Singapore Real Estate Exchange and National University of Singapore (NUS) both produce indexes tracking prices. These are issued monthly.

The PPI is based on transaction prices from caveats lodged and uses a "moving average" method. This means the weights used to compute it are derived by taking the moving average of the values of properties transacted in each market segment over 12 quarters.

But Associate Professor Sing Tien Foo of NUS' department of real estate said it fails to account for changes in the quality of property in different locations.

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