Condo demand pushed PH property prices up in Q2 despite pandemic

MANILA, Philippines — Residential real estate prices of various types of new housing units in the Philippines rose by 27.1 percent in the second quarter of 2020 despite the onset of the coronavirus pandemic, based on the latest survey of the central bank – the highest growth rate since the survey began in 2016.

In the quarterly, Residential Real Estate Price Index poll, banks cited higher demand for high-end projects, which drove the average price per square meter upwards.

The also attributed the spike to rising prices of construction materials, labor costs, and other indirect costs, including higher marketing costs of appraised premium properties.

Further, in terms of area and type of housing unit, the highest contributors to the increase in housing prices were loans for the purchase of condominium units, particularly those in Metro Manila, and single attached or detached houses.

Low base effects also contributed to the price growth, the central bank said.

By area, residential property prices in both the National Capital Region and in areas outside Metro Manila registered growth.

Residential property prices in the metropolis grew by 34.9 percent relative to a year ago, which is higher than the 18.1 percent growth in other areas.

In Metro Manila, all types of housing units registered an increase in prices, except for duplexes as no loans for the purchase of duplexes in the said area were granted and reported in the second quarter of  2020. Likewise, prices outside Manila increased across all types of housing units.

By category of housing units, residential property prices climbed  across all types of dwelling

All types of housing units recorded growth in prices in the second quarter of this year relative to last year’s levels.

Prices of condominium units rose the fastest at 30.1 percent. Similarly, prices of single-detached or attached houses, townhouses, and duplexes grew by 24.1 percent, 10.8 percent, and 0.8 percent, respectively.

In the second quarter, the number of real estate loans granted for all types of new housing units declined by 55.2 percent. Similarly, declines in real estate loans were also observed in both Metro Manila and other areas.

The average appraised value per square meter of new housing units grew by 66 percent, and all types of new housing units recorded a growth in their average appraised values from a year ago.

During the second quarter of 2020, the purchase of new housing units accounted for 84.8 percent of residential real estate loans.

Meanwhile, by type of housing unit, more than half of residential property loans were used for the acquisition of condominium units (62.7 percent), followed by single-detached/attached houses (32.1 percent), and townhouses (4.8 percent).