BSP prepares real estate price monitoring.

In implementing the residential real estate price index (RREPI), the Bangko Sentral ng Pilipinas (BSP) is now requiring banks to submit quarterly residential real estate loans (RRELs) reports.

Data from commercial and thrift banks' RRELs will "provide information for the generation" of RREPI.

"The construction of RREPI based on banks' approved housing loan applications is a first in the Philippines and is expected to provide a valuable tool in assessing the real estate and credit market conditions in the country," said the BSP in a statement yesterday.

Based on the new circular which was approved last October 29, the initial report will cover the second and third quarter of 2015 and must be submitted on or before December 29. The later submissions will be every 20th banking day from the reference quarter.

The BSP is planning to release the RREPI first quarter next year. In a previous interview, BSP managing director for monetary policy sub-sector, Francisco G. Dakila Jr., said the RREPI will plug the gap in the BSP's statistical data when monitoring real estate prices and credit market conditions in the country.

It was explained that the availability of data on property prices is one of the information gaps identified in the Group of Twenty or G-20 report following the Global Financial Crisis, and is also included in the Special Data Dissemination Standard Plus categories under Financial Soundness Indicators that member countries of the International Monetary Fund should adhere to within five years from the time the country signifies its intent to participate in this global undertaking.

Dakila said the RREPI will be one of its valuable tools in assessing the real estate market and trends in asset prices.

Banks' loan applications for real estate is one of the many information that BSP is using in processing RREPI on a quarterly basis. It is also using what it called a preliminary RREPI which was based on construction materials and building permits. This is data they obtain from the Philippine Statistics Authority.

BSP officials insist there is no evidence yet of asset bubble formation. An asset bubble or the rapid rise of property prices triggered the 2007 and 2008 global financial crisis.

CAPTION(S):

File photo of the Bangko Sentral ng Pilipinas complex on Roxas Blvd. in Malate, Manilaa