PRICES of residential products in the Philippines have reached its quiescent period yet construction of housing projects has continued, according to a real-estate consulting firm.
Per its Market Insight report for the third quarter of 2017, Pinnacle Real Estate Consulting Services Inc. (Precsi) cited that residential property values in the country slightly slipped from the first-quarter rates to the second-quarter prices.
In fact, the Residential Real Estate Price Index (RREPI) of the Bangko Sentral ng Pilipinas (BSP) modestly decreased from 116.7 in the first quarter of the year to 116.6 for the second quarter of 2017.
The base period of the index, or the time when it was at the “100” level, is from January to March of 2015.
Given this, residential property prices grew by 16.6 percent since the first quarter of 2015.
“The slight decrease from the first quarter to the second quarter of 2017 means that prices are ‘plateauing’ or perhaps even dipping,” explained Precsi Director of Research and Consulting Jose Romarx Salas in the study. “Nonetheless, the big players are still building due to the huge housing backlog.”
He elaborated that major developers get tough and maximize their corporate advantages.
“They look for new demand in the market, like the dormitory housing,” the executive added.
A lot of real-estate developers, including the small- and medium-size players, are also waiting for the implementing rules and regulation, as well as the price ceiling of the vertical socialized projects.
“This is intended to tame the housing backlog,” Salas noted.
Earlier reports showed Pag-IBIG Fund Chief Executive Officer Acmad Rizaldy P. Moti revealing his expectations that workers would be highly mobile in the future.
“We may have to consider that people may prefer to rent than get housing units in fixed communities,” he said.
Beyond the traditional lending they provide, Moti pointed out that the public housing sector could consider constructing condominiums and tenements to suit the highly mobile nature of some occupations.
Housing developers may also consider “offering them rent-to-own units,” he added.
Taking a cue from Moti’s pronouncement and the bullish outlook of the big players, Precsi is in the view that residential development shall continue, according to Salas.
“It is doubly important then that proper market research and segmentation is done to avoid margin compression when faced with stiff competition for the same market share,” he stressed.