CONDO IN THE PHILIPPINES

Condominiums are changing the way we live, or at least changing the way we want to. Real estate in the Philippines has never been this bullish. In 2013 alone, 51,000 new high-rise units were unveiled based on the data released by property consultancy firm, Colliers International Philippines.

This boom in the real estate industry may be attributed to affordable payment terms, according to National Real Estate Association Inc. president, Benigno Cabrieto. In an interview with the Business Mirror in February 2013, he said that low interest rates and Pag-IBIG fund have helped boost the condo industry. Cabrieto mentioned that more Filipinos are now embracing vertical living because land is scarce and expensive. The seemingly unstoppable urban migration also has a hand in this.

He also pointed out the increasing demand from Overseas Filipino Workers. Estimates show that 30% or P240-billion of the $20-billion remittances was invested in real estate, mostly to condominiums in Metro Manila.

The demand, he adds, is dictated by the need and affordability. For example, OFWs buy for investment while professionals for location and convenience. Starter families are also encouraged to leave their apartments because they may find that the rent is almost the same as the monthly amortization cost for a condo.


Rock Star Economy

Local real estate developers and foreign investors have never been more confident with the Philippine economy. In 2013, the Philippines recorded the second highest economic growth in Asia with a gross domestic product (GDP) of 7.2%, next only to China. The National Economic Development Authority is confident that the trend will continue this year.

True enough, even the International Monetary Fund hiked the country’s growth forecast this year. The initial forecast of 6.3% was increased to 6.5%. Credit rating firms Moody’s and Standard and Poor’s also raised their forecasts. Moody’s analytics are so optimistic that they even predicted that the Philippines will be the economic leader in Asia in 2014.

Thanks to the robust economy, the business of real estate is showing no signs of slowing down. According to the World Bank, there is an increase in consumer confidence to buy real estate properties. The WB latest Philippine Economic Update stated that low interest rates are mostly to be credited for the boost. Furthermore, the report also put emphasis on the luxury residential segment that is significantly picking up largely because of OFWs and expatriates.

This is phenomenal because in 2013, the average price of a luxury 3-bedroom condominium in the Makati Central Business District soared by 12.92%, nearly P129,000 per square meter, according to Colliers International. In other high-end districts like Bonifacio Global City and Rockwell, the average price of a premium 3-bedroom unit was pegged at P127,000 and P132,000 respectively.

We can measure economic progress through the real estate industry’s success. It can also measure how foreign investors are perceiving Philippine markets now. In a survey by the Urban Land Institute and PwC, Manila ranked 4th out of 23 Asian cities as a real estate market and investment prospect, next only to Tokyo, Shanghai, and Jakarta. In the survey, the country edged out Sydney, Guangzhou, Singapore, and Beijing. The fast growing economy and increasing popularity as an alternative to traditional markets allowed the Philippines to jump from the twelfth spot to fourth place. Specifically, in the category city development, the Philippines ranked 8th and received a “buy” rating for the capital’s residential sector.

Foreign investments show a positive outlook for the real estate industry despite typhoons, earthquakes, and even traffic. In an interview with Inquirer Business, Managing Director of real estate firm KMC MAG Group, Michael McCullough, said that Metro Manila is a perfect place for business. “Metro Manila remains the best value city to do business, largely because of the relatively low real estate costs, and Makati remains to be the location of choice of luxurious residential spaces.” Although there are risks, he said the benefits outweigh them.

FOR INQUIRIES PLEASE CONTACT:
RAQUEL CINENSE
(0920) 6273091
(0915) 3636381
(02) 736-1731
FOR MORE PROPERTIES VISIT:

WWW.BAHAYSHOP.COM
WWW.CONDYSHOP.COM