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    Default New private home price index launched in Singapore

    http://www.channelnewsasia.com/stori...045525/1/.html

    New private home price index launched in Singapore

    By May Wong | Posted: 24 March 2010 1408 hrs


    SINGAPORE: There is a new price index to provide information on the state of the residential market in Singapore.

    The index was developed by the National University of Singapore's Institute of Real Estate Studies and is the first such index by an academic institution here.

    The Singapore Residential Price Index, or SRPI, which tracks month-on-month price movements, will provide a resource for the development of property derivatives.

    That will then help to expand the suite of financial products offered in Singapore.

    Organisations like real estate firms and financial institutions can use the index to help them better manage their direct real estate exposure and to hedge their portfolio risks.

    The index looks at factors like the unique location of each property and volume of transactions to consider the price movement of the market.

    One unique feature of this new index is that it uses a fixed basket of properties to determine the data.

    The basket comprises 364 private residential projects located across 26 postal districts in Singapore.

    The composition of the basket will be adjusted bi-annually to reflect the changes in the completed stock of private non-landed residential properties.

    The basket will be next revised in December 2011.

    The NUS hopes its new index would complement the existing one by the Urban Redevelopment Authority that is released quarterly.

    - CNA/ir

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    Default New price index more timely

    http://www.businesstimes.com.sg/sub/...78366,00.html?

    Published March 25, 2010

    A better picture of the private property market

    New, monthly price index will also help in development of property derivatives

    By UMA SHANKARI


    (SINGAPORE) Singapore now has a second price index to provide information on the state of the private housing market here.

    The new Singapore Residential Price Index, or SRPI, aims to provide a resource for the development of property derivatives. It tracks month-on-month price movements in the private non-landed residential property market.

    Right now, property investors have just one price index to work with: the Urban Redevelopment Authority's (URA) private residential property price index. That index is released on a quarterly basis and has sometimes been criticised for lagging a fast-moving market.

    The National University of Singapore's Institute of Real Estate Studies developed the SRPI after a dialogue with industry players as well as help from the Monetary Authority of Singapore (MAS) and the Singapore Exchange (SGX).

    The institute hopes that, as real estate grows in importance as an asset class in the region, the SRPI will serve as a benchmark index and a reference for structuring property derivative products.

    'As the index gains in acceptance, it can potentially be used for risk management through the development of products such a property derivatives,' said Senior Minister of State for National Development Grace Fu, who officially launched the SRPI yesterday. 'Such derivatives may be one way for real estate developers, asset managers, banks and investors to hedge their property exposure.'

    The new index differs from URA's in several significant ways. For one thing, it will be updated every month, instead of once a quarter.

    The SRPI is also computed using the market values of a basket of only completed properties. Right now, the basket has 364 private residential projects located across the island that were completed between October 1998 and September 2009.

    Uncompleted projects were not included in the basket as price movements in such projects can be vastly different from those seen for the rest of the market. But the impact of new launches on the prices of completed properties in the vicinity will be factored in.

    The URA index, on the other hand, includes transactions at new launches and sub-sales.

    The SRPI also considers the address, completion date, tenure, leasehold maturity, floor level and strata area of all units in the projects in its basket.

    The differences mean that the two indices can throw up very different numbers.

    According to the SRPI, prices of non-landed private homes rose 22.2 per cent from December 2008 to December 2009. But URA's private residential property price index showed that prices of non-landed properties increased just 0.5 per cent for the whole of 2009.

    And as for Singapore's central areas, the SRPI showed a 27.3 per cent jump in prices from December 2008 to December 2009 for the 'central region' (postal districts 1-4 and 9-11). The URA price index, by contrast, showed that prices of non-landed properties in the 'core central region' fell 1.8 per cent over 2009.

    Knight Frank chairman Tan Tiong Cheng pointed out that the methodology used to develop the SRPI is 'clearly spelled out' while that used by URA for its price index is 'less known'.

    'This can lead to some misunderstanding of the URA price index, especially in a volatile market,' Mr Tan said. 'What it means is there will be a lag effect when price movements in a fast-moving market do not get reflected immediately in the price index. This became quite obvious when the market corrected itself significantly post-Lehman, and the URA index clearly did not reflect that.'

    A developer BT spoke to also said that it might be easier to 'bet' on the property market using the SRPI, instead of the URA price index, as more information is available about how the SRPI is calculated.

    But he warned that there will still be some lag effect in the new index as it still uses transaction data from URA. This is derived from caveats lodged by buyers, who can sometimes take months to lodge a caveat - or even choose not to lodge one at all.

    URA said the SRPI is compiled for the purpose of trading property derivatives. It lets market participants refer to an index that tracks the price movements of a specific basket of properties, or the specific sector of the property market which they wish to gain exposure to or hedge against.

    On the other hand, URA's property price index is designed to provide the general public and industry players with a 'broad indication of price trends in the private residential market'.

    URA's index captures 'all transactions and so may present a different picture from specific parts of the market', a spokesman said.


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    http://www.straitstimes.com/PrimeNew...ry_506186.html

    Mar 25, 2010

    New monthly index of private home prices

    It will offer closer tracking of prices of non-landed properties

    By Joyce Teo, Property Correspondent


    A NEW index that tracks the price of private non-landed homes month by month has been created to help owners, investors and other property watchers keep a handle on the fast-moving market.

    The Singapore Residential Price Index (SRPI), as it is called, has been formulated by the National University of Singapore (NUS) after two years of research.

    It functions much like the Straits Times Index for shares but instead of following certain stocks, the SRPI is based on the transacted prices of a selected basket of completed non-landed private homes.

    The only other index that tries to get a grip on the property market is one put out by the Urban Redevelopment Authority, but that is only published quarterly.

    It is compiled based on all types of private home transactions and is intended to provide a broad indication of price trends.

    The new index, which has a narrower focus, was launched yesterday by Senior Minister of State for National Develop- ment Grace Fu.

    Ms Fu told the function at the Four Seasons hotel that the index can help analyse price trends and assist investors in making more informed decisions.

    Associate Professor Lum Sau Kim, who led the NUS project, said formulating the index was motivated by industry interest in property derivatives.

    These financial products can give investors exposure to real estate or help others manage risks in their investments.

    The SRPI reflects such risks. It is based on a basket that broadly represents the target market, so landed homes, forming such a small segment, are excluded.

    It also excludes projects that are more than a decade old, those that are small, rarely traded, or targeted for en bloc sale.

    The basket will change every two years to reflect changes in the completed stock of private non-landed homes.

    Its initial make-up comprises 74,359 units in 364 projects across 26 postal districts, completed between October 1998 and September last year.

    Only completed homes are used so as to reduce the influence of new launch prices and sub-sales, which may not reflect the market. Care will also be taken to dampen the effect of one-off deals or over-the-top prices.

    'Once it is an index that people trade on, it has to be very robust to guard against manipulations,' said Savills Singapore managing director Michael Ng.

    While property derivatives may be some time away, the SRPI's immediate benefit will be in providing reliable price data, said Mr Simon Cheong, president of the Real Estate Developers' Association of Singapore.

    Mr Cheong said it is all the more timely as the non-landed homes sector is going through 'a particularly volatile period with shorter cycles where market watchers are eagerly looking for more transparency and greater clarity on market movements'.

    Cushman & Wakefield managing director Donald Han added: 'We're seeing higher volumes and rapid movements in prices, so there's a need to have a monthly coverage of property prices.

    'The SRPI will have a more accurate picture. It helps to reduce panic.'

    Updated on the 28th of each month, the SRPI is on the NUS website at www.ires.nus.edu.sg/srpi_main.aspx

    [email protected]
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    Default New home price index makes a light splash

    http://www.businesstimes.com.sg/sub/...78918,00.html?

    Published March 30, 2010

    New home price index makes a light splash

    Much-anticipated index shows private home prices edged up just 0.2% in February

    By UMA SHANKARI


    (SINGAPORE) Prices of non-landed private homes held steady in February, a new index set up to track residential property prices here shows.

    The Singapore Residential Price Index, or SRPI, showed that private home prices across the island rose just 0.2 per cent month-on-month in February 2010, after climbing 2.2 per cent in January.

    But the gains come on the back of a 22.2 per cent rise in 2009 - putting the index's current value just 0.4 per cent below its peak in November 2007.

    The new index, which is compiled by the Institute of Real Estate Studies at the National University of Singapore, was set up last week to serve as a resource for developing property derivatives in Singapore. It tracks month-on-month price movements in the private non-landed residential property market using a basket of 364 completed projects.

    By contrast, the official Urban Redevelopment Authority (URA) private residential property price index, which is released every quarter, includes transactions at new launches and sub-sales.

    According to the URA index, private home prices hit a recent high in the second quarter of 2008 - before falling for the next four quarters. Home prices then recovered somewhat, rising 15.8 per cent in Q3 2009 and 7.4 per cent in Q4. But the URA index is still some 6.6 per cent off its recent Q2 2008 peak.

    Analysts said that the SRPI moved up only slightly in February as most of the market activity centred around new launches.

    Developers sold 1,196 new homes in February 2010 (slightly less than the 1,480 new homes sold in January). But market watchers said that in the resale market (sales of units in completed projects) there was a larger month-on-month fall in the transaction volume.

    'The new index is for completed properties and most of the price movements and market activity over the last few weeks have been seen for new launches,' said Colin Tan, director of research and consultancy at Chesterton Suntec International. 'Prices at completed properties are also more stable as these projects tend to draw a different type of investors as compared to new launches.'

    Tay Huey Ying, Colliers' director for research and advisory, similarly said that the index was flat in February 2010 as only properties completed between October 1998 and September 2009 are included in the basket.

    Associate Professor Lum Sau Kim, who leads the group that compiles the new index, said one key feature of the SRPI is that it is not too affected by new launches. It is also designed to not be unduly influenced by low transaction volumes in a quiet market.

    She attributed the marginal movement in the index for February to the Chinese New Year season, when buying activity traditionally tapers off.

    The SRPI also showed a drop in home prices in the central region (postal districts 1-4 and 9-11) in February. Prices there fell 0.1 per cent last month after climbing 1.6 per cent in January.

    For the whole of 2009, prices in the central region rose 27.3 per cent. But prices in the central region are still around 10 per cent off the pre-crisis peak, according to the index.

    Elsewhere, prices in the non-central areas rose 0.5 per cent in February after climbing 2.7 per cent in January. Private home prices in the non-central regions have now exceeded the pre-crisis peak.

    Analysts predict that when the URA flash estimates are released early next month, it will show that private home prices climbed 5-8 per cent in the first quarter of 2010.

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    http://www.straitstimes.com/Invest/S...ry_507478.html

    Mar 28, 2010

    property

    New price index more timely

    SRPI tracks prices on monthly basis, gives more accurate picture of state of market

    By Joyce Teo


    Last Wednesday, the Institute of Real Estate Studies at the National University of Singapore (NUS) announced that it had formulated an index called the Singapore Residential Price Index (SRPI).

    It tracks prices of completed private non-landed homes month on month and will provide owners, investors, banks and property watchers with another source of price data.

    Property experts have commented that it will be a more timely index than the quarterly one put out by the Urban Redevelopment Authority (URA).

    The SRPI can serve as a reference index that will help expand the suite of property-based financial products, such as property derivatives.

    The index is based on the transacted prices of a selected basket that broadly represents the target market. Therefore, landed homes, projects that are more than a decade old, and those that are small, rarely traded or targeted for collective sales, are excluded.

    The basket will change every two years to reflect changes in the completed stock of private non-landed homes.

    Its initial make-up comprises 74,359 units in 364 projects across 26 postal districts, completed between October 1998 and September last year.

    Also, the SRPI takes into account the address, completion date, tenure, leasehold maturity, floor level and strata area of all units in the completed projects in this basket.

    The URA property price index, on the other hand, is designed to provide the general public and industry players with a broad indication of price trends in the private residential market, a URA spokesman said.

    It is thus compiled based on all types of transactions (that is, new sales, sub-sales and resales) and covers both landed and non-landed private homes.

    Also, the URA releases price indices for both non-landed and landed properties.

    In particular, URA's index includes prices of uncompleted units sold by developers and sub-sales. Such transactions account for about half of all transactions, said the spokesman.

    The SRPI has only two sub-indices by region - central and non-central areas.

    Already, its flash data for January showed a rise in prices that month.

    The data shows that resale prices in the non-central regions have now exceeded the previous high in January 2008 by 4.5 per cent.

    However, the prices for the central region are still about 10 per cent below the previous peak.

    Associate Professor Lum Sau Kim, who led the NUS project, said one key feature of the SRPI is that it will not be unduly influenced by small numbers of transactions in a quiet market.

    The impact of one-off extremely high or low prices will also be dampened, she said.

    Knight Frank chairman Tan Tiong Cheng said: 'Now we have a very clear, transparent and timely index. The lag period is only one month. The main difference is that the URA indices are computed based on the moving average of the value of transactions over the last 12 quarters, so there's a greater lag effect.'

    Besides the timing, Cushman & Wakefield managing director Donald Han pointed out that the SRPI should provide a more accurate picture as its basket does not include new launches. These are typically priced higher than the market and may not reflect the state of the overall market.

    Mr Simon Cheong, president of the Real Estate Developers' Association of Singapore, said at the launch of the index that an index like the SRPI, computed based on the market value of a fixed reference basket of properties over time, 'can better reflect the actual movement in price'.

    'We are all well aware of how, for example, the current proliferation of 'micro apartments' can distort the picture and send a wrong signal to the market when only median prices of all transactions are tracked and reported,' he said.

    This is because these micro units, which can be 500 sq ft or less, are sold at a higher per sq ft price. As prices rise, units shrink to keep the total quantum price at an affordable level.

    The index, updated on the 28th of every month, is available at www.ires.nus.edu.sg/srpi.aspx

    [email protected]

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    http://www.straitstimes.com/STForum/...ry_507751.html

    Mar 29, 2010

    New property index shouldn't be restrictive


    LAST Thursday's report, 'New monthly index of private home prices', is constructive for the long-term development of the local property market.

    It provides for greater price transparency which allows the market and regulators to work more efficiently.

    In cases where different statistics indicate conflicting states of the property market, the new index can also act as a principal gauge against which these other statistics are compared.

    This is due to its fairly comprehensive nature comprising '74,359 units in 364 projects across 26 postal districts'.

    However, the inclusion of only completed homes may not be a sound practice. While there is reason to exclude 'outlier' deals where prices are exceptionally high or low, new launch and sub-sale prices can form a portion of the index.

    This proportion should certainly be smaller than completed homes but not including them would affect the representativeness and accuracy of the index. People may inaccurately use the index to gauge property prices when considering the purchase of a new condominium launch.

    Furthermore, there seems to be a premium charged for new property launches and their non-inclusion would understate the index.

    As a principle, the index should give representation to segments of the market which are significant and non-completed homes fit that criterion.

    The index is a significant step forward but its composition must not be too restrictive. This is especially so if it is used as a benchmark by property participants and the basis of financial derivatives.

    Loke Hon Yiong

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    Quote Originally Posted by mr funny
    Published March 25, 2010

    A better picture of the private property market

    New, monthly price index will also help in development of property derivatives

    By UMA SHANKARI


    (SINGAPORE) Singapore now has a second price index to provide information on the state of the private housing market here.

    The SRPI is also computed using the market values of a basket of only completed properties. Right now, the basket has 364 private residential projects located across the island that were completed between October 1998 and September 2009.

    URA's index captures 'all transactions and so may present a different picture from specific parts of the market', a spokesman said.

    WRONG! WRONG! WRONG!

    How can stock indices like STI and DJIA be allowed to track only "selective companies" while property indices have to track ALL properties "across the island"?

    This allows some people here to claim that stocks outperform properties over the long term, which is NONSENSE.

    That's like saying Nigerians are wealthier than Singaporeans because the top 30 Nigerians have an average networth greater than the average of ALL Singaporeans.

    I have compiled JLRX's Singapre PROPERTISM Index (JSPI).

    The JSPI index tracks 30 "selected" properties (same as the number of stocks in STI).

    METHODOLOGY OF JLRX PROPERTISM INDEX (JSPI)

    Same methology as stock indices throughout the world.

    Includes only 30 "selective" properties.

    Example 1: Farrer Court transacted $380,000 on 21 Jan 2002 and en bloced at $2.4 million on 28 Jun 2007 (up 532%).

    Example 2: Margate Road detached houses transacted $306 psf on 12 July 2001 and $1,815 psf on 12 Nov 2007 (up 493%).

    The average return of JSPI "selective" properties is as representative of all properties in Singapore as STI is of Singapore's stock market. The average return of properties was 500% over the past 10 years.

    JLRX is pleased to superimpose JLRX Singapore PROPERTISM Index (JSPI) onto the URA property index, NUS's Singapore Residential Price Index (SRPI) and the Straits Times Index (STI).

    It clearly shows that Singapore properties have appreciated by 500% over the last ten years, compared to a miserable 46% for the Straits Times Index (STI) and (not shown to avoid contaminating the graph) the DJIA which has appreciated 0% over the last 10 years.


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    Not only that, you need to review the component properties every quarter and remove those whose prices got stuck and cannot move with those "highly liquid" (read "prices keep moving upwards") ones and you JLRX Property Index will look even more fantastic!


    Quote Originally Posted by jlrx
    WRONG! WRONG! WRONG!

    How can stock indices like STI and DJIA be allowed to track only "selective companies" while property indices have to track ALL properties "across the island"?

    This allows some people here to claim that stocks outperform properties over the long term, which is NONSENSE.

    That's like saying Nigerians are wealthier than Singaporeans because the top 30 Nigerians have an average networth greater than the average of ALL Singaporeans.

    I have compiled JLRX's Singapre PROPERTISM Index (JSPI).

    The JSPI index tracks 30 "selected" properties (same as the number of stocks in STI).

    METHODOLOGY OF JLRX PROPERTISM INDEX (JSPI)

    Same methology as stock indices throughout the world.

    Includes only 30 "selective" properties.

    Example 1: Farrer Court transacted $380,000 on 21 Jan 2002 and en bloced at $2.4 million on 28 Jun 2007 (up 532%).

    Example 2: Margate Road detached houses transacted $306 psf on 12 July 2001 and $1,815 psf on 12 Nov 2007 (up 493%).

    The average return of JSPI "selective" properties is as representative of all properties in Singapore as STI is of Singapore's stock market. The average return of properties was 500% over the past 10 years.

    JLRX is pleased to superimpose JLRX Singapore PROPERTISM Index (JSPI) onto the URA property index, NUS's Singapore Residential Price Index (SRPI) and the Straits Times Index (STI).

    It clearly shows that Singapore properties have appreciated by 500% over the last ten years, compared to a miserable 46% for the Straits Times Index (STI) and (not shown to avoid contaminating the graph) the DJIA which has appreciated 0% over the last 10 years.


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    Quote Originally Posted by teddybear
    Not only that, you need to review the component properties every quarter and remove those whose prices got stuck and cannot move with those "highly liquid" (read "prices keep moving upwards") ones and you JLRX Property Index will look even more fantastic!
    Wow ... You read my mind so well!

    I offer you a position as Chief PROPERTISM Analyst at JRLX PROPERTISM Research Corporation.

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    Quote Originally Posted by teddybear
    Not only that, you need to review the component properties every quarter and remove those whose prices got stuck and cannot move with those "highly liquid" (read "prices keep moving upwards") ones and you JLRX Property Index will look even more fantastic!

    does this work in the govt ??

    those ministers thats not 'performing'... wiill become Minister with No Portfolio?

    and then suddenly one day he annouces he resigns ..... due to health or what crap reasons?

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    Thank you thank you.
    How much is my pay? Can work from home right?

    Quote Originally Posted by jlrx
    Wow ... You read my mind so well!

    I offer you a position as Chief PROPERTISM Analyst at JRLX PROPERTISM Research Corporation.

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    Quote Originally Posted by teddybear
    Thank you thank you.
    How much is my pay? Can work from home right?
    do you think he needs an oversea branch ???

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    May be may be? He needs one to convince the Ang Mohs on "Propertism" (because they are still not believers - that is why have US sub-prime!).

    Quote Originally Posted by proud owner
    do you think he needs an oversea branch ???

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    Quote Originally Posted by teddybear
    Thank you thank you.
    How much is my pay? Can work from home right?
    The wonders of this religion called PROPERTISM is that the believers are automatically rewarded financially by the religion itself, in this lifetime.

    PROPERTISM believes that property prices always go up in the long term, hence properties should only be bought and not sold.

    Mark the sentence underlined in bold and recite it 5 times a day while helping me to compile the JSPI index.

    It will either help you achieve tremendous financial rewards if you carry out the "bought" part, or avoid undue agony if you uphold the principle of "not sold".

    Quote Originally Posted by proud owner
    do you think he needs an oversea branch ???
    I may open an overseas branch in due course, but at this moment there is no suitable candidate to man its office.

    Although you are based overseas, unlike teddybear who has shown his understanding of PROPERTISM from his post above, you are constantly preoccupied by the ministerial salaries.

    Although both property prices and ministerial salaries always go up in the long term, I don't want my JLRX Singapore PROPERTISM Index to end up as a Ministerial Salaries Index.

    If you want to reap the heavenly rewards of PROPERTISM, you must clear your mind of ministerial salaries and think more about PROPERTISM.

    Quote Originally Posted by proud owner
    does this work in the govt ??

    those ministers thats not 'performing'... wiill become Minister with No Portfolio?

    and then suddenly one day he annouces he resigns ..... due to health or what crap reasons?
    Quote Originally Posted by proud owner
    by the way ... almost every country is making adjustments to their bonus pay out to bankers ...

    are our ministers bonus being reviewed ?

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