Housing prices down in Q2
Housing prices declined in the second quarter due to lower cost of single detached units, according to a survey conducted by the Bangko Sentral ng Pilipinas (BSP).
The Residential Real Estate Price Index (RREPI) during the quarter ending June decreased 4.6 percent to 116.6 from 122.2 a year ago, the BSP said.
The index was unchanged on a quarter-on-quarter basis.
RREPI measures the average change in prices of various types of housing units over a period of time across geographical areas where the growth rate of the index measures house price inflation.
BSP data showed the 9.9-percent decline in the prices of single detached housing units pulled down the index during the second quarter.
On the other hand, duplex and condominium units during the period both registered a 5.1 percent increase in prices year-on-year. Cost of townhouses also climbed 2.9 percent over the same period.
By area, the BSP said the RREPI in the National Capital Region rose 2.5 percent to 120.1 from 117.9 in the same quarter in 2016.
“In NCR, the higher growth in prices of condominium units offset the decline in prices of single detached houses and townhouses,” the BSP said.
Prices of duplex and condominium units in the NCR grew 11.9 percent and 5.2 percent, respectively, while single detached units and townhouses declined 6.1 percent and 0.9 percent.
In areas outside of NCR, the RREPI went down 8.2 percent to 114.7 from 116 a year ago as the drop in prices of single detached houses outweighed the increases in prices of condominium units and townhouses.
Meanwhile, the BSP said about eight out of 10 real estate loans extended by banks in the second quarter were used for the purchase of new housing units.
About 45.3 percent of this was for the acquisition of single detached units, 44.8 percent for condominium units and 9.6 percent for townhouses.
NCR accounted for 44.9 percent of the total residential real estate loans during the quarter, with condominium units as the most common purchases.
Based on the latest data from the BSP, the share of real estate exposures from the bank’s total loan portfolio stood at 20.79 percent as of end-June this year.
Real estate loans rose 18.4 percent to P1.64 trillion in the first half due to strong demand. Residential loans, in particular, accounted for P561.31 billion, up 21.3 percent from the same period last year.
To monitor the risks in this growing sector, the BSP earlier tightened its reporting requirements for the real estate loan (as well as project financing) exposure of banks.
Fitch Ratings welcomed the move, noting that it would strengthen the oversight on the banking system’s exposure to real estate loans and project financing. However, the credit watcher said the new measure does not provide prudential standards to curb growth in these sectors.