Monday, 2 April 2018

Phillipines Residential real estate prices up 5.7% in Q4

April 02, 2018

Residential real estate prices rose by 5.7 percent year-on-year during the fourth quarter last year as the Residential Real Estate Price Index (RREPI) increased to 117.4 from 111.1 for the same quarter a year ago.

Year-on-year, prices of townhouses and condominium units grew faster at 8.1 percent and 14.2 percent compared to the previous quarter, respectively.

Meanwhile, prices of single detached housing units declined slightly by 0.3 percent.

Quarter-on-quarter, the RREPI also went up by 5.2 percent.

For full year 2017, residential property prices, on average, grew by 3.6 percent compared to the previous year.

The RREPI measures the average change in prices of various types of housing units comprising of single detached/attached house, duplex, townhouse, and condominium unit based on data from housing loans granted by universal, commercial, and thrift banks.

The average residential property prices in both NCR and AONCR also went up by 8.8 percent and 3 percent compared to year-ago prices, respectively.

In NCR, the higher growth in prices of condominium units and duplexes offset the decline in prices of single detached houses and townhouses. In AONCR, prices of all types of housing units increased.

For period covered, eight in ten residential real estate loans were for the purchase of new housing units.

By type of housing unit, 52.8 percent of residential property loans were for the acquisition of condominium units, followed by single detached units at 39.5 percent and townhouses at 7.3 percent.

By area, condominium units were the most common house purchases in NCR while single detached houses were prevalent in AONCR.

By region, NCR accounted for 52.6 percent of the total number of residential real estate loans granted during the quarter, followed by CALABARZON at 23.6 percent, Central Luzon at 6.4 percent, Central Visayas at 4.7 percent, Western Visayas at 4.7 percent, Davao Region at 2.8
percent and Northern Mindanao at 1.6 percent. Together, these seven regions accounted for 96.4 percent of total housing loans granted by banks.

The Bangko Sentral ng Pilipinas requires all universal/commercial banks (UBs/KBs) and thrift banks (TBs) in the Philippines to submit a quarterly report on all Residential Real Estate Loans (RRELs) granted for the generation of the RREPI.

Out of the 98 banks covered, 97 banks or 99 percent submitted their reports to the BSP which cover the fourth quarter of 2017.

The RREPI, which is estimated every quarter based on housing loans granted by banks, is a first in the Philippines. It provides a valuable tool in assessing the real estate and credit market conditions in the country.

The RREPI is computed as weighted chain-linked index based on the average appraised value per square meter weighted by the share of floor area of new housing units.

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