You might heard of PMI, CPI and STI over and over again in the news. PMI stands for Purchasing Managers Index, it is a
measure of the prevailing direction of economic trends in manufacturing, when the number is above 50, it means the
manufacturing is in expanding mode, when the number is under 50, it means manufacturing is in contracting mode.
CPI stands for Consumer Product Index, it is a number to measure a basket of goods are cheaper or more expensive compared with its historic record, or in more economic term, the cost of living or inflation level.
Whereas STI - Straights Times Index is a measure of Singapore stock market movement, it is used to indicate whether the market is over-valued, under-valued or just reasonably valued.
Here RPI is quite the same, it is a number to measure the overall HDB resale market price level. It aims to give us some simplified idea of how the HDB flat resale market is moving compared against its historic record.
Mainly due to its simplicity, by looking at this single index number, you would have an idea of how the resale market is doing for that quarter.
The index is based on quarterly average resale price by date of registration. They are computed using the stratified hedonic regression method, and an index of 100 was set as the base index according to the resale transaction data of 1st quarter 2009.
Overall the Resale Price Index (RPI) number raised from 24.3 to 131.5 during the
past 30 years, and the compounded annual growth rate is about 5.79%, based on formula 24.3x(1+x)30 = 131.5
There are two major fast growing period, one is from 1st quarter of 1993 to 4th quarter of 1996, it is about 4 years. Another one is from 1st quarter of 2007 to 2nd quarter of 2013, it lasted for about 6.5 years.
From an investor's point of view, buying and selling of HDB flat might not be a good choice as suggested by the overall market return. The inflation and interests that you paid could eat up all the returns or a large portion of it.
However, from a public policy perspective, it is a huge success. A stable and affordable flat not only make Singapore one of the highest home ownership rate among many countries in the world, but also achieve relative fairness cross generations, greatly reduced the social inequality that caused problems for many other countries.
Singapore HDB flat resale transactions in last 10 years. Get to know the overall HDB property market trend; Estmate your property value when selling; Or get a benchmark price when you are buying. Help you to make informed decision when buying or selling your property.
Data Used here is from https://data.gov.sg, which are under the Singapore Open Data License.
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