THE NEXT six years belong to Davao, according to property analyst Enrique M. Soriano III.
“Without any doubt, Davao is expected to experience capital and property bliss in the next six years,” Soriano told Inquirer Property.
“This newfound confidence will translate into a buoyant real estate sector fueled primarily by two types of property activity. First, there is speculative real estate, or real estate bought for resale at a profit. The second type of property activity is investment in income-producing property, bought to maintain and hold for its rental income and its future capital growth,” said Soriano, Ateneo program director for real estate and senior adviser for Wong+Bernstein Advisory Group.
Soriano added that with President-elect Rodrigo Duterte, Davao City’s long-running mayor, assuming office on July 1, it would be difficult to temper businessmen, developers or even speculators as they continuously troop to Davao to seek an audience with Duterte.
Monique Cornelio-Pronove, chief executive officer of Pronove Tai International Property Consultants, said: “Davao has been one of the next wave cities for the business process outsourcing (BPO) market and has always been in the radar screen as a tourist destination. Our new president will further boost the attractiveness of Davao as he continues to draw local and foreign attention to it. As it is, the foreign chambers, starting with the European Chamber, have started holding their general membership meetings in Davao. This will bode well for the province.”
So what can Filipinos expect in Davao in the next six years?
“Fundamentally, the first sign of this renewed vigor will be higher sales velocity in new residential developments. The rental market will also experience intermittent increases as the momentum gains traction,” said Soriano.
He added that the vacancy rate would be a good benchmark for office buildings, hotels and condominium developments.
Soriano said: “With rising rents, investors are normally the first to be attracted back into the market. If values are increasing due to repeated land acquisition by national developers, brisk condo sales and rising rents, then we can expect local and foreign investors to pour money into the market. Finally, we will also see the growth of other asset classes like industrial parks and economic zones, and shopping centers.”
Davao was cited as one of the nine trending local cities this year in an Inquirer Property article in January.
Davao remains southern Philippines’ economic and business center, and one of the most searched cities in the Lamudi website in 2015.
Its population is projected to balloon to 1.83 million by 2020. Davao is also consistently among the most searched by online property hunters, and the sixth and third most searched city by property hunters based in the United States and Saudi Arabia, respectively, according to the Lamudi data.
In 2014, Davao, together with Cebu and Iloilo, was cited in an Inquirer Property article featuring popular BPO sites driving Philippine property values up. Analysts added that these cities would continue to book solid growth for as long as the local government leadership provides regulatory and marketing support.