SUNDAY, 13 NOVEMBER 2011 17:46 RIZAL RAOUL REYES / CORRESPONDENT
THE proliferation of high-density vertical subdivision complex in Metro
Manila in the last five years has changed the first-home preferences of
newly formed households, according to property management and consulting
firm CB Richard Ellis (CBRE) Philippines
Victor Asuncion, CBRE Executive Director for Research and Consultancy at
CBRE Philippines, said the company is conducting a five-year study which
started this year until 2016 to track approximately 135,000 condominium
units for completion. About 31-percent of this stock is sold at a price
range of P40,000 to P80,000 per square meter. These are predominantly
studio and one -bedroom units with an average floor area of 30 to 40
square meters.
He said mid-market condominiums are relatively new to the market given
that the earlier condominium projects come with bigger sizes and are
sold at a higher price. Before mid-market condominiums became a big hit
among property buyers, ownership is limited to the upper class given its
restrictive acquisition cost. "However, the advent of mid-market
condominium in the fringe of the business districts across Metro Manila
has opened up a broader base market," he said in his presentation during
the recent year-end briefing of CBRE Philippines held in Makati City.
"The new trend in housing or accommodation is accessibility. First home
buyers are now ready to forgo ownership of house and lots in the suburbs
in exchange for short travel from home to work and any other necessities
e.g. school, shopping centers and tertiary hospitals. In addition,
affordable condominiums now found in Metro Manila have made the idea of
buying over renting a house a sound option," added Asuncion.
Unlike in previous cases when buying a condominium unit is not
acceptable home investment for the mid-market, Asuncion pointed out that
first-time buyers are now more open to acquiring an affordable condo
unit as their new homes.
Home loan fixed rates has also reached 5.75 percent one-year fixed rate
for repricing which makes payments affordable to as low as P10,000
monthly, depending on the project details.
In view of the scarcity of land in Metro Manila for housing
development, Asuncion said even the government has embraced the concept
of affordable condominium development for the mid-market by way of
providing development loan facility to developers and cheap end-use
loans to borrowers.
He said buyers of affordable condominiums can now avail of long-term
housing loans to purchase condo units for as much as P2.5 million per
unit with mortgage rates of 11 percent.
"Property developers are now recognizing the market range and debt of
affordable condominiums for the urban dwellers. Thus, we expect more of
these type of condominium project coming up for the broad mid-market
class," said Asuncion.
Asuncion said supply of affordable condominiums will definitely
out-phase demand but will not cause a glut similar to the events of
1997. He said property developers have learned from their experiences
and will only break ground on projects upon getting at least 50-percent
commitment form buyers. "Hence, we expect a growth of this product niche
in the near future particularly in Metro Manila and other key urban
centers like Metro Cebu and Metro Davao," said Asuncion.
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