Philippine house prices fall for first time in 4 years

philippine house prices fall for first time in 4 years - Philippine house prices fall for first time in 4 years

By Luz Wendy T. Noble, Reporter

HOUSING PRICES fell for the first time in four years in the third quarter, reflecting low consumer confidence amid a coronavirus pandemic, according to the Philippine central bank.

Prices fell by 0.4% from a year earlier based on the Bangko Sentral ng Pilipinas’s (BSP) residential real estate price index, it said in a statement on Wednesday.

This compares with a 4.5% uptick a year ago and a 26.6% jump in April to June this year, the central bank said. This was also the first time the index fell since it first started in 2016.

The index fell by 14.1% from a quarter earlier, the BSP said. It traced the index decline to weak consumer demand for houses and lots.

“This is consistent with the outcome of the Q3 2020 consumer expectations survey, which pointed to the low preference of consumers to buy real estate property amid the pandemic and economic uncertainty,” it added.

The index measures the average change in home prices across building types and locations and gives the central bank an insight into the property market, bank exposures to which are regulated.

Among housing types, prices of condominium units fell the most at 15%, from a 30.1% hike in the second quarter, the BSP said.

Prices of duplex homes also dropped by 8.8%, while prices of townhouses and single detached/attached houses rose by 12% and 7.4% respectively.

In Metro Manila, residential home prices dropped by 12.2%, with condominium units and duplexes both falling by 17.9% and 11.8% respectively.

Prices of single detached/attached houses and townhomes rose by 23.3% and 11.2% respectively.

Outside the capital region, prices of housing units rose by 6.4%, led by townhomes (12%), followed by single attached/detached houses (6.5%) and condominium units (3.6%). Prices of duplex homes fell by 13.3%.

Housing loans plunged by 43% in the third quarter from a year earlier, but climbed by 60% from the previous quarter. Three-fourths of the loans were for new housing units, the central bank said.

The slump in housing loans also reflect tighter credit standards imposed by banks during the pandemic.

Luxury home sales became a trend, with many rich buyers spending on upscale projects even during the pandemic, Colliers Philippines Research Manager Joey Roi H. Bondoc said.

“In the first nine months of 2020, around 48% of mid-income projects that were sold during the period were located in Parañaque, Pasig and the Alabang-Las Piñas area,” he said in a note.

“During the same period, the bulk of upscale to luxury projects that were sold were in Parañaque, Bay Area, Ortigas Center and fringe, and the C-5 Pasig corridor,” he added.

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