CEBU, Philippines - The real estate sector can likely ride on the decline of the global oil price, which has benefited oil importer Philippines and its consumers, an official from the industry said.
Jose Soberano III, chairman and CEO of Cebu Landmasters Inc, said the recent oil price plunge could possibly translate to cheaper construction materials, thus benefiting local property developers.
Oil’s current slide triggered a cut in transportation costs and a boost for businesses which are mostly dependent on fuel in their operations.
“Sometimes, the misfortune of one favors the other,” Soberano shared this insight at the sidelines of CLI’s Park Centrale office building topping-off Thursday.
The sharp collapse in fuel cost may have a psychological impact on real estate investors and buyers. This could likely impact the industry especially the developers, the official said.
Soberano noted cheaper oil allows consumers to have more disposable income and reduces their cost of living expenses. This, in turn, can further drive consumer spending which largely fuels the local economy.
The cost of Brent crude oil in the world market has further dipped below $50 to a six-year low since May 2009. The cheaper oil in recent months is attributed to slowing global economic growth and surging production of gas and oil.
The trend triggers significant revenue shortfalls in oil exporting nations. But if low oil prices are here to stay, oil importers like the Philippines and the consumers at large are the ones getting the advantage of cheap oil.
In addition, Department of Trade and Industry-7 director Asteria Caberte earlier said consumers may have to expect lower prices of basic goods early March amid the drastic drop in global oil price.
Caberte noted lower prices of goods may not directly take effect because producers normally have a three-month inventory of their products. (FREEMAN)