Price or Rent, That Is the Question

46 Pages Posted: 22 Dec 2015 Last revised: 24 Dec 2015

See all articles by Philip Ji

Philip Ji

Dongguk University

Ernie G. S. Teo

NUS Business School

Date Written: December 24, 2015


We utilize a novel method from Phillips, Shi and Yu (2013) to investigate whether Singaporean real estate markets have experienced bubbles. This method involves a doubly recursive right tailed unit root test which can be used for real time policy decisions. We fi…nd that the Singaporean real estate markets were subjected to explosive growth (where fundamental rental grew at a higher rate than property prices) during the Global Financial Crisis. We also found two specifi…c segments lead the Singaporean residential housing markets and commercial markets. Additionally, it is found that these two leading sectors affected the growth of other markets positively in normal periods and negatively during the Global Financial Crisis.

Keywords: property bubble, singapore real estate, price rent ratio, negative bubbles

JEL Classification: C00, R00

Suggested Citation

Ji, Philip and Teo, Ernie G. S., Price or Rent, That Is the Question (December 24, 2015). Available at SSRN: or

Philip Ji

Dongguk University ( email )

Korea, Republic of (South Korea)

Ernie G. S. Teo (Contact Author)

NUS Business School ( email )

15 Kent Ridge Drive

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