ASEAN integration: Boon or bane to real estate
The anticipated ASEAN integration next year could be a boon or bane to the real estate sector, depending on how industry players prepare in guarding their turf with the entry of more real estate experts from the neighboring countries.
This according to real estate analyst Eric Soriano stressing that the 2015 ASEAN integration could provide good or bad condition to the country’s booming real estate sector.
However, with the country’s high restriction on ownership prevents some foreign capitalists from ASEAN to own 100 percent of a business for instance in real estate, while this protects the local players, consumers will not be able to enjoy the high benefit of stronger competition between developers.
This means that the high ownership restriction could discourage investors of real estate sector from ASEAN to pour in their money here and participate in the competition, which in turn denying the opportunity for consumers to have wider and better options.
According to Cuervo Property Advisory, ASEAN can be an opportunity for businesses, including the real estate industry. The region has ASEAN Valuers Association (AVA), a group that caters to real estate professional in Southeast Asia.
Realizing the close cooperation among real estate professionals from ASEAN member countries would help promote the aspirations, objectives and principles of the ASEAN.
Soriano said while the integration will keep local developers on their toes to take advantage of the widening market base, the Philippines in general is not yet ready to face the competition that a unified market will bring.
In general he said the Philippines may lose its competitive advantage if it will not change some of its policies that will conform to the changing requirement in the ASEAN integration.
Soriano said that even if the integration has yet to be implemented, the Philippines has already felt the effects of it as other countries have already started its works in positioning in the region in terms of visibility, presence, and attracting investors.
Trying to keep investors to come to the Philippines may be difficult saying “we still have very high restriction in ownership, unless they fixed these issues, the Philippines may lose its competitive advantage.”
Moreover, Soriano said in terms of infrastructure the Philippines is very much lagging behind other ASEAN countries, and this is another critical factor that would threaten the competitiveness of the country when the integration will be fully implemented.
“We are not ready to compete with the ASEAN nations in terms of infrastructure. We have poor logistical infra, our airport and seaports are not competitive,” he added.
“Looking at the ASEAN integration issue, I am a bit wary. In the infrastructure alone—we are not ready,” he reiterated.