OFWs, BPO to drive real estate growth

CEBU, Philippines - The Philippines will continue to enjoy a dynamic real estate industry owing to the growth rate of the country’s top market contributor, the Overseas Filipino Workers (OFWs) and the Business Process Outsourcing (BPO) industry.

Economist Jonas Ravelas of the Banco de Oro Universal Bank predicted that developers will continue to build projects in real estate, specially residential developments, as the Philippines is still facing backlog of residential supply.

This strong confidence from the property developer is prompted by the growing demand from the Philippine market, despite the gloomy economic prospects in other countries, like United States and Europe.

Ravelas said what also activates the market further, aside from the desperate demand for housing units, is the banks’ active stance to offer attractive loan packages for residential consumers, boosted by the low interest rate environment.

Ravelas said Filipinos are now seeing the significance in investing their money into real estate. And today is the right time to take a grip on real estate investments, as the banking sector is offering the lowest interest rate in recent times.

In the next five to six years however, interest rates are expected to rise, while prices for real estate products also increase considerably.

Those who have money and has the capability to get a loan from banks, are encouraged to invest now, he said.

The only danger that Ravelas is seeing is the recovery of the US economy, wherein capital inflows that boost the Philippine economy are seen to decelerate.

Although, the BPO sector in the Philippines is expected to be here for long term, some loose investments however, may leave the country, once US and Europe will get its feet again—economically.

Thus, Ravelas said Filipinos should make their decision in investing into real estate at least within the next three years, while the economy is still on its strong position, and foreign capital inflows are still coming in, to flood the system with more monetary circulation.

Ravelas recommended that Filipinos, across all segments, should invest now, instead of depositing their money in the banks. Also, in order to help the economy moving, Filipinos are also urged to spend or consume more, while saving more.

Now is the time to borrow money from the banks, as liquidity is swelling the inthe Philippine banking system. Banks are more agressive now, although they (bank) are also prudent in their “credit scoring” strategy.

Latest record from Housing and Urban Development and Coordinating Council (HUDCC) revealed that there is a total 170 thousand un-served market that needs affordable housing facilities, in Cebu.

Cebu, which is becoming a metropolitan and urban center in the Southern Philippines, is now embracing the condominium living lifestyle, specifically because land area is limited. (FREEMAN)