The stabilisation of residential property prices continued.
- The stabilisation of residential property prices continued with small fluctuations in the RPPI (houses and apartments) and its sub-indices, amid positive prospects for the sector evident in other economic indicators.
- According to the RPPI, residential property prices fell marginally by 0,8% in 2016Q1 compared with 2015Q4. Apartment prices increased on a quarterly basis by 0,6% and house prices decreased by 1,3%.
- During the last four quarters, the RPPI recorded on a quarterly basis either small reductions or no change, which, in combination with other developments in the sector, suggests that residential property prices are stabilising.
- On an annual basis, the reductions in residential property prices continued to decelerate, declining by 1,6% in 2016Q1. This is the smallest decrease since 2010Q3.
- Other relevant indicators of the property market show positive developments and suggest favourable prospects for the sector. For example, demand for properties, as measured by the sales contracts registered with the Department of Lands and Surveys, recorded a significant increase in 2016Q1, while in the same period construction activity increased.
Residential property price indices
During 2016Q1, the RPPI recorded a marginal decrease (0,8%) compared with the fourth quarter of 2015. House prices showed a quarterly decline of 1,3%, while the apartment prices registered a quarterly increase of 0,6% (Chart 1). The fact that during the last four quarters the RPPI registered either marginal decreases or remained stable, shows the trend for price stabilisation that currently exists in the property market.
On an annual basis, the RPPI recorded a 1,6% decrease compared with an annual decrease of 1,8% in 2015Q4. House prices fell by 1,9% and apartment prices fell by 0,7% on an annual basis, compared with annual reductions of 1,4% and 2,8%, respectively, in 2015Q4. As shown in Chart 2, these annual reductions are on a steady path towards the zero line, meaning that residential property prices are stabilising.
Download the full PDF Residential Property Price Index Q1 2016