MANILA, Philippines?Building houses must go on despite the prevailing turbulence in the financial markets.
This was somehow the message of some of the country?s developers in reaction to the crisis that is currently encircling global financial markets.
?Of course, we are worried about big traditional banks and insurance companies going bankrupt or getting taken over. But this should not distract us from our mission of providing shelter to millions of Filipinos who still doesn?t have a home of their own,? said Eduardo Alunan, national president of the Subdivision and Housing Developers Association Inc., the largest organization of real estate developers in the country.
Based on the 2004-2010 Medium Term Philippine Development Plan, the country will need 3.756 million units.
With the government promising to provide a third of the units required or 1.145 million units, the remaining 2.6 million units will be left to the private sector (development of socialized and low-cost housing).
Demand still high
In fact, local developers said the demand for properties, especially from the upper and middle sector, is still high.
?In fact, sales of condominium units increased because of the accessibility and the convenience they provide (easy to maintain) and the fact that cost of transportation has gone up,? noted Roy Calleja, president of PA Metro Residences Builders Inc. whose project include the East Residences Ortigas condominium properties in Pasig City.
He added that homebuyers would rather live near their workplace or retirees choosing a smaller house so they could spend less for its maintenance as well as electrical and water expenses.
Even those developments outside Metro Manila continue to get buyers.
?At this point in time, developers like us are just becoming more conscious of our market, offering them options that will enable them to pay the amortization,? explained Romarico Alvarez, chair of PA Alvarez Properties and Development Corp., which offers several developments in the provinces of Laguna and Cavite.
He noted that the relatively low price of properties in the Philippines is still enough reason for more homebuyers to shop.
?We are also encouraged by the fact that the government is supporting us by granting tax holidays and zero duty on importation of capital goods, especially on our low-cost mass housing projects,? he said.
Alvarez was referring to the tax perks that the Board of Investments has provided to PA Alvarez?s P514.85 million low-cost, mass housing projects, namely, Phase 1 and 2 of St. Joseph Village located in Barangay Langgam.
Housing units offered within this 15.15-hectare projects are priced between P400,000 and P750,000.
Banking on OFWs
?Aside from locally based homebuyers, we are also banking on overseas Filipino workers who continue to bring in their money despite the rising exchange rate. For them, putting their hard-earned money to buy homes for their family is still a better investment,? Alvarez said.
Remittances are expected to reach about $15.65 billion (P727.1 billion) by the end of 2008 since $8.2 billion (P381 billion) has been sent home in the first six months of 2008.
?We should support the OFWs as well as the building of mid-priced to low-cost housing, which the families of these OFWs cater to. A mass housing project has a multiplier effect of 16.6, which means that for every peso invested in a housing project, P16.60 worth of investments in related industries sectors are generated,? Alunan explained.
He added that even as the crisis is still unraveling, everything will stabilize in due course and that policymakers here in Asia are in a better position to cope as they have already taken some of the early lessons from the past crisis.
