Philippines home prices keep upward trend in Q3
CEBU, Philippines — Residential real estate prices in the Philippines continued to show upward trend during the third quarter of 2023, with a year-on-year (YoY) surge of 12.9 percent and a quarter-on-quarter (QoQ) increase of 3.4 percent.
While these figures reflect a slightly slower pace compared to the robust growth recorded in the second quarter of 2023 at 14.1 percent YoY and 5.3 percent QoQ, the market continues to show resilience and positive momentum, the Bangko Sentral Ng Pilipinas (BSP) report indicated.
On a YoY basis, residential property prices in the National Capital Region (NCR) rose by 12.3 percent in Q3 2023 as prices of single-detached/attached houses, condominium units, and townhouses increased for the same period. Similarly, residential property prices in Areas Outside the NCR (AONCR) grew by 14.3 percent, driven by more positive annual increases in the prices of all types of housing units.
On a QoQ basis, residential property prices rose by 11.5 percent and 0.1 percent in the NCR and AONCR, respectively.
By housing type, prices of duplex housing units registered the highest YoY growth rate in the third quarter 2023 (at 57.7 percent), followed by single-detached/attached houses (at 16.8 percent), townhouses (at 9.3 percent), and condominium units (at 8.3 percent).
A look at the QoQ changes revealed that the prices of duplex housing units, likewise, grew the fastest (by 30.8 percent), followed by condominium units (by 15.6 percent), and single-detached/attached houses (by 1.4 percent). Meanwhile, prices of townhouse units declined from the previous quarter.
In the third quarter of 2023, the number of residential real estate loans (RRELs) granted for all types of new housing units in the Philippines declined by 1.8 percent YoY as those from the NCR contracted by 11.9 percent outweighing the 5.1 percent growth in AONCR.
By contrast, nationwide housing loan availments grew by 18 percent QoQ, following the 31.9 percent and 11.3 percent increase in RRELs in the NCR and AONCR, respectively.
The total number of RRELs granted in the Philippines rose by 6 percent YoY driven by the double-digit growth in AONCR (15 percent), which outweighed the 9.3 percent contraction in the NCR. Likewise, the total number of transactions grew by 22.3 percent QoQ, brought about by the 34 percent and 17.5 percent increase in the number of RRELs in the NCR and AONCR, respectively.
During the same period, the appraised value of new housing units in the country averaged Php92,168 per square meter (sqm), with a 9 percent and 17.5 percent growth over comparable year- and quarter-ago levels, respectively.
Meanwhile, the average appraised value per sqm in the NCR increased by 12.4 percent YoY and 22.4 percent QoQ to Php156,530 per sqm. In AONCR, the appraised value per sqm expanded by 17.1 percent YoY and 1.3 percent QoQ, to an average of Php55,202. It may be noted that the average appraised value of properties in the NCR is around three times higher than in AONCR.
The weight of each type of housing unit in the RREPI is determined by dividing the total floor area (in sqm) of a specific type of housing unit over the total floor area of all housing types. In Q3 2023, single-detached/attached houses constituted the largest weight in the RREPI at 52.6 percent. Meanwhile, condominium units, townhouses, and duplex housing units accounted for 25.5 percent, 21.3 percent, and 0.6 percent in the calculation of the RREPI, respectively.
In the first nine months of 2023, 76.2 percent of residential real estate loan (RRELs) transactions were used to purchase new housing units.
Meanwhile, by type of housing unit, most of the residential property loans were used for the acquisition of single-detached/attached houses (48.2 percent), followed by condominium units (36.3 percent) and townhouses (15 percent).
Most of the RRELs granted in the NCR were for the purchase of condominium units, while RRELs granted in AONCR were for the purchase of single-detached/attached houses.
By region, 31.8 percent of the total number of RRELs granted were from the NCR, while the balance was from AONCR as follows: CALABARZON (32.2 percent), Central Luzon (12.3 percent), Western Visayas (6.1 percent), Central Visayas (5.8 percent), Davao Region (3.4 percent), and Cagayan Region (2 percent).
The said regions, including the NCR, comprised 93.6 percent of the total housing loans granted by banks. — (FREEMAN)
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