The National Bank of Cambodia (NBC) is currently working with the International Monetary Fund (IMF) to review the methodology for measuring housing prices nationwide under the Residential Property Price Index (RPPI), an inflation monitor first installed by the NBC in 2022. The review comes in the background of a detailed report initiated by the international organization in January, which suggested some oversights in the current data and methodology used to formulate the RPPI by the NBC, which may be inflating the index’s growth, and overestimating house price increases. RPPI is an important indicator of inflation levels within the economy, alongside the Consumer Price Index (CPI).
In the same fashion that the CPI compares periodic consumer price trends, the RPPI provides an overall national housing price index based on data from housing loans issued by Cambodian banks. As Cambodia witnessed a boom in the real estate sector between 2017 and 2021, the NBC launched the RPPI in mid-2022 to specifically focus on the rise and fall of residential housing prices, as a guide for managing economy-wide inflation levels. In June 2022, the newly instated RPPI index indicated a 9 percent increase in housing prices nationwide compared to 2020 levels.
By mid-2023, the RPPI had undergone a significant 16 percent rise in housing prices. As of the first quarter of 2024, the RPPI dipped somewhat again to 12 percent, compared to 2020 prices. In the corresponding period, however, Cambodia’s i.
