PHL home prices surge amid pandemic

*^{Condominium units posted an overall 5.1% price increase in Q2 2017, led by a 7.1% pickup in the provinces and a milder 5.2% increase in Metro Manila.}*

Home prices surged by a record 27% in the second quarter, driven by strong demand for high-end residential projects and an uptick in costs amid the pandemic-induced lockdown, the central bank said.

The Residential Real Estate Price Index (RREPI) jumped 27.1% year on year in the April to June period, the highest annual growth recorded since the series started in 2016. This was also quicker than the 12.4% hike in the first three months of 2020 and the 0.4% rise in the April to June 2019 period.

The index gauges the average change in home prices across building types and locations and provides the BSP an insight into the property market, bank exposure to which is regulated.

“Banks cited the following reasons for the uptick in real estate prices in Q2 2020: higher demand for high-end projects, which drove the average price per square meter (sq.m) upwards; and rising prices of construction materials, labor costs and other indirect costs, e.g., higher marketing costs of appraised premium properties,” the BSP said.

The biggest contributor to the rise in housing prices were loans for the purchase of condominium units, particularly in Metro Manila.

Condominium units recorded the fastest price uptick at 30.1% in the April to June period, while prices of single detached/attached houses jumped by 24.1%, reversing the 4.2% decrease last year.

Prices of townhomes and duplexes also increased by 10.8% and 0.8%, respectively in the April to June period.

In Metro Manila, prices of residential homes rose 34.9% with the fastest growth seen in single detached/attached houses (70%), followed by condominium units (36.4%), and town houses (5%).

In the provinces, residential property prices also rose by 18% with the uptick led by single/detached homes (21.1%), followed by townhouses (13.2%), duplexes (5.2%), and condominium units (3.1%).

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Article and Photo originally posted by Business World last September 25, 2020 6:43pm.