Residential property prices up 2.7% in Q2

CEBU, Philippines — Prices of new residential units in the Philippines have increased in the second quarter of 2024 by 2.7 percent year-on-year (YoY), albeit at a slower pace than the 6.1 in this year’s first quarter.

According to Bangko Sentral Ng Pilipinas (BSP), on a quarter-on-quarter (QoQ) basis, housing prices grew faster at 1.8 percent than the 1.1 percent growth in the first quarter this year.

On a YoY basis, residential property prices in the National Capital Region (NCR) contracted by 1.0 percent in the second quarter of 2024 with the decline in the prices of single-detached/attached houses outweighing the increase in the prices of townhouses and condominium units.

By contrast, residential property prices in Areas Outside the NCR (AONCR) increased by 4.2 percent. This growth was driven by the annual price increases in duplex housing units, single-detached/attached houses, and condominium units, which surpassed the decline in townhouse prices.

On a QoQ basis, residential property prices in the NCR and AONCR rose by 3.8 percent and 1.2 percent, respectively.

By housing type (excluding the duplex housing units), condominiums registered the highest YoY growth rate of 10.6 percent in the second quarter of 2024, followed by a 1.7 percent growth in single-detached/attached houses.  Meanwhile, townhouses registered a contraction of 0.8 percent.

On a QoQ basis, price increases across housing types in the second quarter of 2024 were mixed. Prices of condominium units grew the fastest at 4.2 percent, followed by single-detached/attached houses at 3.2 percent, while duplex housing units and townhouses registered a 2.3 percent and 2.6 percent decline, respectively.

On the other hand, in the second quarter of 2024, BSP reported that the number of residential real estate loans (RRELs) granted for all types of new housing units in the Philippines contracted by 3.5 percent YoY. 

Specifically, loans granted in the NCR decreased by 9.2 percent, while those in AONCR declined marginally by 0.8 percent.

On a QoQ basis, nationwide housing loan availments fell by 15.1 percent, following the decline in the NCR and AONCR of 11.5 percent and 16.6 percent, respectively.

The total number of RRELs granted in the Philippines decreased by 3.2 percent YoY, which reflected the 0.9 percent and 4.2 percent contraction in both the NCR and AONCR, respectively.

Similarly, the total number of transactions decreased by 9.9 percent QoQ as the 14-percent decline in the number of RRELs in AONCR negated the 1.4-percent growth in the NCR.

In the second quarter of 2024, the appraised value of new housing units in the country averaged P83,759 per square meter (sqm), registering 6.8 percent and 1.8 percent growth rates over the comparable year-ago and quarter-ago levels, respectively.

Similarly, the average appraised value per sqm in the NCR increased by 9.6 percent YoY and 5.6 percent QoQ to P140,158 per sqm.

Meanwhile, the average appraised value per sqm in AONCR expanded by 7.8 percent YoY but declined by 4.0 percent QoQ to Php58,741. The average appraised value of properties in the NCR is more than twice that in the AONCR.

In the second quarter of this year, 78.7 percent of residential real estate loan (RRELs) transactions were used to purchase new housing units. By type of housing unit, most of the residential property loans were used for the acquisition of single-detached/attached houses at 47.9 percent, followed by condominium units (32.5 percent), and townhouses (19.3 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, 29.7 percent of the total number of RRELs granted were from the NCR. The other regions, that contributed significantly to the number of RRELS granted, include; CALABARZON (30.1 percent), Central Luzon (13.0 percent), Central Visayas (8.0 percent), Western Visayas (7.0 percent), Davao Region (4.4 percent), and Northern Mindanao (3.3 percent). The said regions, including the NCR, comprised 95.5 percent of the total housing loans granted by banks.

Data for the RREPI are obtained through BSP Circular No. 892 dated 16 November 2015, which requires all universal/commercial banks (UBs/KBs) and thrift banks (TBs) in the Philippines to submit to the BSP a quarterly report on all RRELs granted. This was supplemented by the BSP Circular No. 1154 dated 14 September 2022, which requires all digital banks (DBs) in the country to submit similar reports to the BSP.