CEBU, Philippines, June 4 (Reuters) - Philippine house inflation rose at a faster annual pace in the first quarter of this year compared with the previous quarter, the central bank said, citing the first results of a newly formulated index tracking property prices.
The residential real estate price index (RREPI), which covers different types of housing units, climbed 9.2 percent in the first three months of this year from a year earlier.
That was higher than the annual increases of 5.1 percent and 4.3 percent in the fourth and third quarters of 2015 but lower than the 12.8 percent gain in the second quarter of last year.
Diwa Guinigundo, deputy governor of the Bangko Sentral ng Pilipinas, said the first-quarter rate pointed to a "vibrant" housing industry that was "driven by demand and not by oversupply" and that the likelihood of asset price inflation was "quite remote".
The RREPI is the first such indicator in the Philippines and is based on banks' approved housing loan applications. The index would help regulators track property prices, credit market conditions and assess the risks arising from the booming real estate market in the Philippines, Guinigundo said late on Friday.
About seven out of 10 residential real estate loans granted were for the purchase of new housing units, central bank data showed, with condominiums the most common housing purchases in Metro Manila.
Guinigundo said the index would become a better gauge of risk as policymakers collect more information, allowing them to create a longer series of data.
Policymakers have repeatedly said there were no signs of an asset bubble in the rapidly expanding property market. They have noted that, while banks' property exposure continued to rise, their non-performing real estate loans were declining.
Strong consumption, fuelled by rising incomes from a growing outsourcing industry and steady remittance inflows from Filipino workers overseas, have been driving the property market upturn.
The Philippines is expected to remain one of the fastest-growing economies in Asia, with the incoming government of President-elect Rodrigo Duterte aiming for faster growth of 7-8 percent.
The Philippine economy grew 6.9 percent in the first quarter, its fastest annual growth in nearly three years on strong domestic demand and investments. (Reporting by Karen Lema; Editing by Paul Tait)