Property Market Update – June 2009

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hello everyone,
it’s now june and half the year is just over. it’s been a mixed market with buyers still believing
that residential prices of houses and lots are due for correction but have remained stabled at the
least and has even gone up. it’s really the condominium market particularly the studios and 1
bedroom units that are affected and have shown some correction in prices.
below is a general summary of market conditions which has a direct affect on our economy :

a) global demand for RP export continue to decline
b) stock market is up 30% in general although some corrections are due
c) HLURB application are up particularly in the condominium development showing increasing demand
d)office vacancy are up and prices continue to correct due to downsizing and deferred expansion plans of locators
e) residential condos vacancy are up particularly for the smaller units and rentals rate are under pressure
f) older buildings vacancy are affected as most tenants are moving to newer condominiums
g) buying parameters of newer building ( 1 – 3 years old ) within makati and global city are Php 100T/m2
h) pre-selling developments have slowed down with exceptions of a few developers who have a captured niche
i) secondary market of residential lots and houses remain strong with a 5% appreciation on select areas
g) rentals of high end houses are starting to slow down showing correction in prices and vacancy
h)decision making is slow generally and will affect prices and terms of leases due to deferred expansion of locators

In Makati CBD, it’s just Solaris One that’s being completed. Other lots are opting for Build to Suit options
which takes 12-18 months to deliver. Ayala Land has completed several of these development.
At Bonifacio Global City, 11 office building are under construction and 5 more are in the pipeline.
Ortigas Center has 6 office buildings to be completed within the year.

Makati CBD has 5 projects for completion next year
Luxury condominiums are on the rise ( Raffles, Discovery Primea, and Shangrila )
At Bonifacio Global City, 25 projects are due for completion next year

With the delivery of new condominiums in the Makati, Bonifacio Global City, Quezon City,
and other areas in Metro Manila, prices of older condominiums will now have to compete
in prices and terms in order to prevent increasing vacancy. I’ve seen a lot of older units
being renovated just to cope up with the newer condos but price and upkeep of the building
will be a determining factor. Newer buildings are preferred with Rockwell, Makati CBD and
Bonifacio Global City as the primary demand.

Inquiries have dramatically increased beginning March 2009 in comparison to late 2008
Notable increase in transactions beginning April 2009 ( as verified from notary public, BIR and RD )
Manila Bulletin Ads have increased their volume of activities due to number of advertisers
Income property demand has also increased as investors are looking for good returns on their investment.

To recap, the market remains strong particularly in the residential and commercial segment ( lots, houses, townhouses ).
I have been servicing several clients who have been waiting for prices to correct particularly in the Makati and Pasig areas
but it just hasn’t happened. Now that a few have accepted the fact that prices remain strong, i still believe that we can see
further appreciation of land values within the 5% to 7% range depending on the location.

Finally, our Real Estate Association, REBAP, will have it’s General Member Assembly this coming Thursday with Sen. Panfilo Lacson as our keynote speaker to talk about the much awaited RESA ( Real Estate Services Act ), which has already been approved in congress. This is in line with the government’s move to professionalize our industry and to rid of those “colorrum” salespeople practicing real estate without the proper license.

REBAP Greenhills is also inviting all who want to be licensed real brokers this coming July 4, 11, 18, 25, Aug 1, 8. Our review is from 1pm to 5pm. This is the last chance to be a licensed broker without taking a 4 year curriculum as now required by Department of Trade and Industry. For details, please call our CRES Directress, Ms. Eloise Enriquez at 9868901. Please call soon as few slots are available.

Thanks for taking the time to read my newsletter and may God Bless you all.