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Why Are Filipinos Buying Homes: The Real Estate Landscape in the Philippines

Why Are Filipinos Buying Homes: The Real Estate Landscape in the Philippines

With the country’s growth looking to remain stable throughout 2017, there is little doubt that the real estate market will continue its upward trajectory

For a lot of Filipinos, buying a home is the ultimate dream. It is having a space that you own, and can call your own home.

Recent years have seen a boom in Filipinos purchasing real estate, driven by lower loan interest rates and construction boom in the residential real estate sector.

In 2014, 69 percent of Filipinos prefer renting a house over buying one. The study, conducted by Lamudi Philippines, also reported that those who did plan on buying a home—96 percent—were looking to buy property in Metro Manila.

In 2015, Lamudi reported that an increasing number of people in the 25-34 age range were looking into buying homes, and the proclivity to want to buy gets higher as they get older.

 

When It Becomes an Idea

Much of a person’s capability to purchase a house stems from having the finances to cover the down-payment and monthly loan amortization on the property. Other times, people invest in real estate even when they have zero cash because they really want a home to call their own.

With property prices in highly sought-after communities in the country increasing, one of the most viable options for people who wish to purchase homes is to buy pre-selling condos in soon-to-open mixed-use townships or in fringe areas outside Metro Manila.

Here’s where there is a divide between homebuyers. Those who are younger tend to prefer having access to the city, and thus, look for houses or condominium units that are within the city—with Quezon City and Makati topping the list at 27 and 20 percent, respectively.

While the volume of people looking for houses to buy increases as they age—around the 25–34 age range—they also begin to expand their searches to outside Metro Manila.

Many Metro Manila–based homebuyers who cannot afford the capital’s expensive real estate are looking at houses in the provinces of Cavite, Laguna, and Rizal.

 

Influencing Factors

One of the factors that influence the current real estate boom is the country’s massive housing backlog(estimated to be between 3 and 5.5 million housing units).

As the Philippines’ population has already crossed the 100 million mark, providing shelter to this many Filipinos is a huge challenge. As a result, townships, mixed-use communities, low-cost condominiums, and subdivisions have sprouted up in areas surrounding Metro Manila. However, more should be done in terms of housing affordability and increasing access to financing.

It does not look like this trend will stop anytime soon. Real estate developers have started to look further outside Metro Manila for their next big projects. Given this overall optimistic sentiment, those who want to buy property should be able to do so without stretching themselves too thin.

 

Final Thoughts

With the country’s growth looking to remain stable throughout 2017, there is little doubt that the real estate market will continue its upward trajectory. It is expected that more investors are planning to come in as the demand for living space rises, and this creates a continuous effect of creating jobs that contribute to overall spending power for those who want to buy a house.

 

This article was originally posted by Lamudi Philippines

Cebu’s Property Future Continues to Rise

Cebu’s Property Future Continues to Rise

Experts, developers see more opportunities for property sector in 2017

The construction boom in Cebu continues as more vertical and horizontal projects are being lined up for development this year.

Amid this development, a property expert has noted the maturity of the market while an official of a real estate firm has seen this year as the heyday of real estate in Cebu.

Jojo Salas, research director at Pinnacle Real Estate Consulting Services, Inc., said Cebu’s property market has reached its maturity and that the challenge for players now is to stay competitive.

For Pinnacle, “due diligence” means knowing where to go and what kind of property to develop.

Salas said they have constantly advised their clients that the “you will build and they will come” mentality is no longer acceptable at present, unlike in the past when developers raked in huge amounts of profit.

He said developers need to be more deliberate in terms of planning and targeting their market, especially now that the industry has become more competitive in terms of pricing and product.

Market overview

In its property market overview as of November 2016, Pinnacle saw robust performances in the office, residential, retail, and hotel markets, but placed greater confidence in Cebu’s industrial sector.

Salas said that the industrial zones in Metro Cebu, which is comprised of 13 towns and cities, were already filled up four years ago, well ahead of their counterparts in Luzon.

At present, Metro Cebu has 27 IT parks/centers, seven manufacturing zones, two tourism economic zones, and one agro-industrial economic zone.

Of the total area of economic zones estimated at 120 hectares, only less than three hectares of space are available for lease, reflecting an occupancy rate of 97.5 percent.

Available space

To address the limited available industrial space in Metro Cebu, an additional 50 hectares will be reclaimed for a light industrial park in Minglanilla town under a public-private partnership between the Philippine Reclamation Authority, the local government unit, and Cebu Landmasters.

The recently approved vertical socialized housing as well as the increase in price and loan ceiling for economy housing may further drive the boom in the residential sector, which saw a 148-percent growth in the number of condominium units sold in the last four years.

In terms of residential stock, the market now has approximately 22,284 condominium units while it only had about 9,026 in 2013. Furthermore, an average of 5,000 units will be delivered in the next couple of years.

On take up, the average is 5,000 units per year, which is to say that the projected increase may be comfortably absorbed by the market. Stable increase in prices also showed the sector’s soundness.

The average selling price in 2013 was around P84,000 per sq. m.; P90,000 per sq. m. in 2014; and in 2015, at P95,000 per sq. m. At present, the estimated average selling price is at P99,000 per sq. m., a growth of 18 percent from the 2013 level.

CEO’s take

For Beverly Dayanan, president and chief executive officer of Contempo Property Holdings, Inc. (CPHI), this kind of growth has never happened in the real estate industry before.

“It’s a heyday for real estate,” she said, adding that she foresees the industry to continue to flourish even in the next 10 years.

Dayanan anchored her confidence in the leadership of the present administration, with Duterte emphasizing the need for more low- to middle-class housing.

“Where our current administration would go, we would be very supportive of that effort,” she said.

Dayanan said that the drawback, however, is the continuing rise in the price of land, which is considered to be the biggest input of industry players.

“That is why we are strengthening our organization to move and expand our reach to Mindanao,” she explained.

Challenging year

Alexander Mañalac, chairman of the National Real Estate Association (NREA), however, said that 2016 had been very challenging.

“There are those that earned well, there are those that didn’t,” he said.

Mañalac said that 2017 will be exciting only for those that are properly positioned, especially those whose presence can be found online, while those that only “wait for blessings to come” will never prosper.

“Those who really chase these opportunities and know how to develop the system, build the network, these are the people who can survive and thrive in any situation,” he said.

More to be done

Efren Carreon, the National Economic and Development Authority Central Visayas (NEDA-7) director, said that while economic growth was necessary over the last five years, it was still not enough for poverty reduction.

“More need to be done to achieve inclusivity,” he said, adding that there should be more opportunities for those in the fishing and agriculture sectors since most of the country’s population rely on these industries.

Over the last five years, Central Visayas’ Gross Regional Development Product (GRDP) has grown by an average of 7.2 percent, which is short of the planning agency’s target of 7.5 percent.

Nonetheless, Carreon said he was confident the region will meet its target in the near and medium term due to the thrust of the current administration to bring development outside of the capital.

This article was originally posted by Cebu Daily News; Credits to the photo owner

Tips for Millennials Who Want to Invest in Real Estate

Tips for Millennials Who Want to Invest in Real Estate

There are a variety of ways that millennials can start investing in real estate and many young people are taking different routes depending on their job situation, financial history, credit score, etc. However, there are several principles that every real estate investor should follow, no matter the route that they take—especially if they are new to investing. Here are a few ways that you can start preparing for your first real estate investment:

 

1. Work on your credit score

Investing in real estate is not something you can start doing overnight. There are some steps that you should take before you buy your first property such as having a good credit score. Fortunately, when it comes to hard money loans, your credit score isn’t as important as it may be if you were applying for a traditional loan. Hard money lenders generally look at the value of the property and not at the borrower’s finances or credit. However, paying off all of your loans and having a solid credit score will give you an advantage.

 

2. Save

There are plenty of ways to get financing for your real estate investment, but having proof of consistent saving will help when finding a lender. Successful investors start saving a certain amount from each paycheck that stays tucked away until their first purchase. Doing this will also teach you the value of your money and self-restraint. This can be difficult if you have student loans, but if you focus on paying off high-interest debts first, pay more than the minimum balance due and only spend money on the essentials, you will be able to pay off your loans much more quickly.

 

3. Don’t doubt yourself

Every investor has to start somewhere and you shouldn’t let your fear of failure get in your way. Failure is a part of life and it is a big part of investments. There are always risks, but if you do your research, you can help to minimize your risk and start making money. You will make mistakes, but you will learn from them. You may hear that voice in the back of your head telling you that you’re going to fail, but that doesn’t mean you have to believe it! The important thing is to just get out there and start investing and you’ll learn the rest along the way.

 

4. Start Networking

An important aspect of investing is getting to know the right people. Meeting with real estate agents, contractors and other investors will help you learn about the industry and you will make important contacts along the way. When it comes to real estate investing, you will want to have a solid team of people that you work with and you can start building that team before you start investing. There are plenty of real estate investment organizations, events and meet-ups all over the country and you can find them by searching online.

5. Follow your head

It’s easy to base your decisions on your heart instead of your head, especially when it comes to real estate. A property may look perfect on the outside but it may not be all it’s cracked up to be. Getting professional advice is always a smart move when it comes to buying property. An objective inspector will help you determine if the property is worth the money and effort. There are plenty of things beneath the surface of the property that may cost more money than you think. Get an inspector to help determine how much you will need to spend on the maintenance and repairs before you buy the property. After all, investments aren’t about gut feelings, emotions or following your heart—it’s all about doing the math.

 

6. Study the market

Speaking of math, that brings us to the last point. Buying, renovating and selling the house is the shortest and most exciting part of the investment. That’s just the tip of the iceberg. Before you even step foot on the property you plan to buy, you need to do your research. You can start by finding your target price range and seeing what homes in that range sell, how long they take to sell and how many times the price was reduced. You can do this by looking at home prices on websites like Redfin.com. When looking at the neighborhoods and real estate markets, here are just a few of the aspects to take into consideration: comps, public transportation, schools, etc. Planning and researching as much as you can will help to minimize risk and that means more money in the long-run.

 

This article was originally published by Redfin

3 Tips to Level Up your Game in the Real Estate Industry

3 Tips to Level Up your Game in the Real Estate Industry

Today, almost every home has access to technology. It is up to us whether to use it to our advantage or consider it as a disruption or distraction that hinders us to complete our tasks. Nevertheless, innovation brings convenience. For businesses, it eases transactions and fast-tracks processes. As technology further advances, everyone must keep up – mostly, those whose careers rely on person-to-person transactions.

The people-centered real estate industry is heavy on person-to-person dealings. Thus, real estate companies are now using technology to their advantage. Most of them are deviating from traditional marketing strategies and are starting to use social media to market their products and services. More so, developers and brokerage firms are now establishing their websites to offer listing services, virtual property viewings, and property management tools. Such breakthroughs encourage homebuyers and sellers to go online to carry out their real estate transactions.

Due to its influence in the real estate industry, technology also greatly affects the way brokers do their job. Aside from knowing the fundamentals of real estate brokerage, they must use technology to be prominent professionals in the business. They must learn that it requires that they shift their role from being salespeople to market experts who know how to answer the questions of their clients correctly.

 

Online presence is essential

Nowadays, homebuyers can just browse the internet to find a property that suits their needs. Before they hire a broker, they already know what they want; they have already done their research, and will probably just hire a professional to assist them with paperwork. Real estate brokers must learn how to level up their game. They must keep up with technology so that homebuyers will know that despite innovation when it comes to property buying, technology can never replace the expertise of a skillful broker. In addition, most buyers research and inquire for a home online; it implies that brokers need to establish an online presence to gain credibility, then, clients.

According to a study published in January 2017 by We Are Social Singapore, there are 60 million internet users in the Philippines. It is safe to say that a chunk of that figure is potential buyers. A broker who spends time building and establishing his online presence has a greater chance of getting qualified leads than a broker who only does flyering.

 

Look at social media as a tool

We use Facebook, Twitter, and Instagram to share photos from our recent vacation or to post videos of our dogs; for professionals who aim to set themselves as experts in their fields, they use their social media accounts to make their presence known to their target market. The power of social media is undeniable. Thus, real estate brokers must learn how to use technology to their advantage aggressively and cleverly. They can create a page that showcases the properties they handle and the services they offer. Ultimately, they should use social media to connect with people and convert uncertain property seekers to qualified clients.

 

The use of technology is profitable

Due to its convenience, we prefer technology in various forms. We no longer have to wait in a taxi stand; we can book a car using our phone. When we want to find the nearest restaurant that offers Kebab, we simply log into an app and do a quick search. Today, the rise of mobile applications is unstoppable. In the real estate industry, brokers upload their listings to property portals that offer free listing services and provide uploaders a Customer Relationship Management (CRM) system. Uploading a property online gives their listings exposure; online exposure guarantees inquiries and can lead to a successful deal. Never underestimate the importance of technology in your business. As property seekers use technology for their convenience, brokers can leverage that trend to profit.

Real estate brokers must not let technology overshadow their expertise. It should serve only as a supplement that helps accomplish tasks efficiently.

 

This article was originally published by Zipmatch

5 Effective Tips for Re-listing your Property

5 Effective Tips for Re-listing your Property

Relisting the property is not an attractive proposition for a seller. This shows poorly on the property because there was something not right with the listing in the first attempt that it couldn’t fetch the right buyer and the price. This raises more questions than interest.

Were you also trying to sell your property but couldn’t do so, in the first attempt? However, after a few months of break, when you figured that the market is bouncing back, you planned to relist it. Though relisting is considered to be a bad proposition and can impact the asking price of the property, there are ways in which you could turn relisting in your favour and fetch the right buyer and the right price, too.

Here are some tips that could help you strike a deal the second time:

 

Analyse the reasons why it didn’t sell

Now that you plan to get your property back in the market, it is time for some reality check. List out the reasons to analyse why your property did not sell. This could include the asking price, the damages, unappealing photographs and description or even an unstaged property. Hire an agent this time to help you know the errors and rectify them.

 

Know when the time is right

After you take down your property from the listings there is a certain time gap that one should maintain before relisting it. While some try to come back in a week or two to make the listing look fresh, like it was never taken down, some take a three-month gap to come back with an all new property at an all new price. For your property you need to know the reason why you have to relist. If the price was the hitch, then you could rework the price and list it in a short period. However, in case the property could not be sold due to construction damages and bad listing images, you should take your time to rectify all of this and come up with the new listing.

 

Low-cost improvements will help

Some improvements in the property might cost you initially, but, this investment could fetch you the price you want. While a buyer could have negotiated the property price based on certain property related faults, now that you give a well-groomed property, there will less room for negotiation.

 

Better photographs can be a saviour

One of the prime reasons a buyer never contacted you after seeing your property listing online could be the photographs of the property. Property pictures can either get you many queries or completely put off potential buyers. Once you give a property some makeover and stage it better, hire a professional photograph and ask them to take pictures that make the property look appealing.

 

A better price might help

As a thumb rule, if a property has not received a single offer for 40 days, the property may be overpriced. We all find our property worthy, but, an asking price that is competitive can make your property attract buyers. While a price drop is not necessary when relisting, you need to know the market sentiment and act accordingly. Here you would need an agent and also, some clear understanding about the price trends in your locality.

 

This article was originally published by www.makaan.com