SRPI will aid the analysis of price trends by offering a snap shot of the non-landed residential property market.
According to Senior Minister of State for National Development & Education Ms Grace Fu, the NUS Singapore Residential Price Index tracks the month-on-month price movements of a selected basket of completed private residential properties, the launch of which adds to the depth of information relating to the property market in Singapore.
Ms Fu said, "As the index gains in acceptance, it can potentially be used for risk management, through the development of products such a property derivatives. Such derivatives may be one way for real estate developers, asset managers, banks and investors to hedge their property exposure."
SRPI, like other risk management products and financial instruments, is expected to meet investors' needs by complementing the existing suite of real estate investment products such as REITs, real estate business trusts, real estate funds and equities.
"The creation of the NUS SRPI is a pioneering initiative and I would like to congratulate NUS for successfully constructing a residential property price index. Going forward, NUS can carefully explore how such indices can be used to meet the needs of property buyers as well as the players in the real estate industry," added the Senior Minister.
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