Positive property market outlook post-election
t is normal to see market volatility in periods of uncertainty like elections but the overall outlook for the year is optimistic. With quarantine and mobility restrictions eased up and return-to-work set-up seen in the coming months, the country’s property sector is hopeful that these will generate the desired uptick in numbers.
Online real estate marketplace Lamudi noted that, in general, elections create market uncertainty as project and policy continuity hangs in the balance. Investors observe a wait-and-see approach as a transition in leadership occurs along with Cabinet appointments and the formation of an economic agenda as pandemic recovery plans continue.
Incoming Department of Finance Secretary and Bangko Sentral ng Pilipinas (BSP) governor Benjamin Diokno in November last year said that the BSP anticipates the real estate market to recover this year after suffering through pandemic-related issues.
“The BSP anticipates that activity in the real estate market will recover in line with rebound in overall economic growth in 2022,” Diokno said.
Several real estate outlook insights and reports agree with this projection.
Property seeking activity, for one, is seeing an uptick in times where good news such as decreasing health threats occur.
Lamudi reported that its platform observed that leads on property search dropped by 3 percent (25 April to 1 May) and 12 percent (2 to 8 May), respectively, in the two weeks leading up to election day, 9 May.
It improved and picked up by 8 percent during the week of election day (9 to 15 May) and has remained stable in the week since.
Lamudi noted that based on its statistics, the increase in property searches coincide with periods marked by a safe and encouraging business environment such as news of the country seeing recovery from a Covid-19 variant surge.
Property watchers also noted that the expected increase of in-office set-up will boost the real estate market.
Global investment management company Colliers in its published report on 23 May (www.colliers.com/ en- ph/ research/ flash report-property sector-expansion economic-growth) highlighted sectors that will see increased activities with the return-to-office mandate. The report said that the office sector will benefit from the mandate influenced by the improving Covid-19 situation that has consistently reported relatively low incidence of cases.
The leasing market will see recovery with the return of office workers in the physical workplace. With the expected influx of workers to the offices, condominium rents and co-living spaces are expected to see an uptick in inquiries or sales. Despite these, the retail sector will see vacancies across Metro Manila malls to increase at a lower pace in the first quarter of the year. Colliers cited how business groups reported that malls have reached about 63% of their pre-Covid-19 level.
While people are trooping back to the city, suburban growth is expected to rise with the continuous infrastructure projects ongoing in its environs.
In the January 2022 report (www. dotproperty.com.ph/blog/4-things-knowphilippine-property-investment-2022) published in the web site of online real estate resource Dot Property, it said that the biggest change in Philippine property investment is seen happening in the suburbs.
“People continue to swap CBD condos for housing outside the city. This is especially true in Metro Manila where township developments to the north and south of the National Capital Region (NCR) have lured people away from metropolitan areas,” the report cited.
“Provinces around NCR are benefiting from the completion of major infrastructure projects, such as the NLEX–SLEX Connector and the Central Luzon Link Expressway among others,” it added.
The report added that if the new normal and work from home policies become the norm, it could “dampen” condominum investment prospects in certain locations.