Home price growth slows in Q1

HOME PRICES in the Philippines posted a modest increase in the first quarter, the Bangko Sentral ng Pilipinas (BSP) said.

The cost of residential property picked up by 2.1% year-on-year in January-March, against the 5.7% climb posted in the fourth quarter and the 6.5% increase in the first quarter of 2017.

Duplexes and townhouses posted the biggest price increases during the quarter but this was offset by lower rates for single-detached or attached houses, the BSP reported over the weekend. Quarter on quarter, housing prices slipped by 0.9%.

The Residential Real Estate Price Index ( RREPI) measures the average change in home prices across building types and locations, allowing the central bank to closely monitor the real estate market and watch out for potential bubbles. The BSP uses sectoral data dating to the fourth quarter of 2015.

Duplex prices rose 44.2% from a year earlier, but accounted for just 0.3% of new housing units acquired during the period. Meanwhile, townhouses posted a 13.8% increase, followed by a 2% pickup in condominium prices.

In contrast, single home prices fell 0.6% to reverse a 9.2% climb a year earlier.

Property prices for homes rose faster in Metro Manila to average 2.7%, easing from an 8.8% pickup during the fourth quarter and 4.4% a year earlier. This compares to a 0.9% increase in the provinces during the first three months of 2018, slowing from 3% the previous quarter and 8% year on year.

The price of duplex units in the National Capital Region rose nearly sixfold, a record.

Meanwhile, townhouse costs rose by 9.1% from a year earlier.

Condominiums, which are the most in- demand units in the capital, saw prices rise 3.3%. On the other hand, single home prices declined 5.3%. Townhouse prices in the regions also rose 15.6% as of end- March, followed by a 6.1% increase in duplex prices. Condominiums and single house prices dropped 3.1% and 0.4%, respectively. Banks reported that 73.5% of property loans were booked to buy new homes, with nearly half used to acquire condominium units. By area, nearly half of the mortgages were secured by those living in Metro Manila, followed by those in Calabarzon (25.5%), Central Luzon (7.1%), and Central Visayas (5.5%). In 2017, housing prices rose by an average of 3.6% nationwide. BSP officials have said that they see strong demand for both commercial and residential property, driving up overall property prices. They added that an asset bubble is not yet apparent. —