Land values in key urban areas in Metro Manila rose in the third quarter of 2011 as rising income levels led to an increase in demand for real estate.
Data from the Bangko Sentral ng Pilipinas showed that land values in the central business district of Makati City averaged at P274,141 per square meter in the third quarter, up by 2.8 percent from P266,674 in the same period the previous year, and 1.9 percent more than the P269,029 per sqm recorded in the second quarter of 2011.
Similarly, land values in Ortigas Center reached P126,350 per sqm in the third quarter of 2011, up by 4.2 percent from P121,257 in the same period the previous year, and up by 0.9 percent from P125,222 in the previous quarter.
“Indicators pointed to moderate improvements in domestic demand,” the BSP said.
At the same time, the BSP allayed fears of an asset price bubble or inflated land prices.
“Real estate activity had remained strong, reflecting still growing demand. There are limited signs of an asset price bubble thus far, although some segments of the residential property sector could be at risk of an oversupply going forward,” the BSP said in a recent report.
The BSP also said that current price levels are still way below those seen prior to the Asian financial crisis of the late 1990s, when the region suffered from asset price bubbles.
Current land values in Metro Manila are just about 65 percent of the values in 1997.—Michelle V. Remo