The global real estate industry is teetering on a meltdown, bogged by raging inflation, the Ukraine war, stock market turmoil, rapidly rising interest rates and soaring borrowing costs.
But the Philippine housing industry is going against the headwinds, with the residential segment maintaining its growth momentum in the first quarter. The Q1 2022 Consumer Expectations Survey (CES) shows that the Residential Real Estate Price Index (RREPI) rose by 5.6 percent from a year ago but declined by 1 percent from the previous quarter.
The year-on-year (YoY) increase in the RREPI is consistent with the outcome of the CES, which showed a higher percentage of consumers preferring to buy real estate property in the first quarter of 2022.
“Meanwhile, residential property prices in the National Capital Region (NCR) increased by 9.5 percent YoY, primarily driven by the increase in the prices of condominium units and townhouses, which more than offset the decrease in the prices of duplex housing units and single-detached/attached houses,” CES said.
Similarly, property prices in the Areas Outside the NCR (AONCR) rose by five percent YoY as all housing units registered an upturn, except for single-detached/attached houses, which posted a decline.
On a quarter-on-quarter (QoQ) basis, trends were mixed as residential property prices rose by 3.5 percent in the NCR but declined by 2.1 percent in the AONCR.
The survey also shows that in the first quarter of 2022, the 5.6 percent YoY growth in the nationwide RREPI was mainly driven by the rise in the prices of townhouses, duplex housing units, and condominiums units, increasing by 25.6 percent, 20.9 percent, and 14.7 percent, respectively. Conversely, prices of single-detached/attached houses contracted by 2.5 percent.
Meanwhile, the 1 percent QoQ contraction in the RREPI was because of the lower prices of townhouses (-1.7 percent) and single-detached/attached houses (-5.1 percent).
In Q1 2022, the number of residential real estate loans (RREL) granted for all types of new housing units in the Philippines contracted by 9.2 percent YoY due mainly to the 39.3-percent decrease in the number of NCR RREL.
Meanwhile, on a QoQ basis, the number of RREL granted contracted by 30.2 percent as the number of RREL in the NCR and AONCR declined by 42.5 percent and 22.9 percent, respectively, CES added.