Housing body, SHDA oppose report of condo glut in Cebu

CEBU, Philippines - The Subdivision and Housing Developers Association (SHDA) believes the growth of the housing sector in Cebu is sustained given the rise in approved subdivision and condo projects.

Following a report from property consultancy firm Colliers International saying that Cebu's condo market has softened, SHDA-Central Visayas President Julie Castaños dismissed such claim and said there is still "existing growth" in the industry.

She stressed that developers would not risk investing in Cebu if they do not see the potential demand.

Castaños said in an interview the number of projects approved by the Housing and Land Use Regulatory Board (HLURB) in Region 7 rose this year compared to last year.

Official data provided by HLURB Regional Director Alexis Roy Lopez on Thursday showed that as of October 2015, the agency approved and gave licenses to sell to 21 condo projects, mostly located in Metro Cebu, compared to 22 approved in whole 2014.

There are still 14 more condo applications with lacking requirements due for the board's final approval. So there are already 35 condo applications received by HLURB-7 as of October.

In the first 10 months of 2015, HLURB-7 approved a total of 6,478 condo units including those of pending applications. Last year, a total of 6,843 units were approved.

HLURB-7 also approved 49 subdivision projects as of end-October this year from 50 approved as of end-2014.

"The leading indicators have given the industry confidence to sustain production," SHDA said in a statement, referring to the HLURB data.

SHDA said "there has been a steady increase in condominium projects applications in 2015."

Earlier, Julius Guevara, director for research and advisory at Colliers, said the condo market in Cebu has experienced a slowdown over concerns of a possible glut. Guevara pointed out that oversupply worries led developers to pull back the launches of their projects.

"The [condo] market has been slowing down because there's just so much out there that people could choose from," he said.

As of the first half in 2015, a total of 2,200 condo units were launched and 2,100 of which were sold compared to the 6,400 units launched and 4,900 units sold in whole 2014, according to the Colliers report.

"The slowdown in the condo market is apparent," Guevara said.

For its part, SHDA also believes there's a spike in the investors market in Cebu as tourism and business process outsourcing (BPO) continue to boom. "Not just residential condo but also condotels are coming in," it added.

Castaños said investors, or those who buy property to rent it out, account for a big portion in the real estate market particularly condo.

Guevara explained that investors, who mostly drive sales in the industry, are in the "wait and see" mode for new developments to be finished before they make their next purchase.

He further advised property developers to take a very good look at the market before investing. (FREEMAN)