Housing prices firm in Q4 — BSP

MANILA, Philippines - Housing prices nationwide remained stable in the fourth quarter of 2016 despite sustained demand, results of a survey conducted by the Bangko Sentral ng Pilipinas (BSP) showed.

The Residential Real Estate Price Index (RREPI) was nearly unchanged, inching up 0.3 percent to 113.9 in the fourth quarter of last year from 113.6 in the same quarter in 2015.

The growth was slower than the 2.2 percent increase recorded in the third quarter of last year when the RREPI stood at 113.4 against the 111 registered in the third quarter of 2015.

The RREPI measures the average changes in prices of different types of housing units over a period of time across geographical areas where the growth rate of the index measures house price inflation.

BSP Deputy Governor Diwa Guinigundo said there is a strong domestic demand for both residential and commercial properties as there is a large shortage of housing units supported by a big base of young, employed people especially in the services sector.

“As the economy continues to grow, demand for commercial space will be sustained. At the same time our real estate developers have become more prudent by doing due diligence of the market as they learned their lesson during the Asian financial crisis,” he said.

Guinigundo pointed out some developers build their projects on a pre-lease basis wherein there are establishments willing to sign contracts for lease even before the actual construction of the building.

The economy grew 6.8 percent last year from 5.9 percent in 2015 as election-related spending boosted private consumption as well as higher investment growth.

The Philippines has booked 72 straight quarters of positive GDP growth.

“Most important, this very strong sign of economic growth is not confined in the National Capital Region. One sees this construction boom in such areas as Cagayan de Oro and Iloilo.”

BSP Governor Amando Tetangco Jr. earlier said housing prices in the country continue to stabilize, signaling a better supply and demand balance in the market.

Data showed townhouses posted the highest growth in prices at 6.2 percent in the fourth quarter last year followed by condominium units with 1.8 percent.

The prices of single detached housing units contracted one percent.

Real property prices continued to rise in areas outside the National Capital Region (AONCR), up 1.7 percent in the fourth quarter of last year while prices in the NCR declined 1.1 percent in the fourth quarter of last year.