Q2 Philippine housing prices dip 9.4%

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The Philippine central bank says house prices across the country dipped by 9.4 per cent year-on-year in April-June. BRITTANY CORP

Prices of various types of new housing units in the Philippines declined for the second consecutive quarter in the April-June period due to the lingering Covid-19 pandemic, according to the latest central bank survey.

In a statement, the Bangko Sentral ng Pilipinas (BSP) said its Residential Real Estate Price Index for the second quarter of 2021 revealed that nationwide house prices contracted by 9.4 per cent due to the continued effects of the Covid-19 crisis on the residential property demand.

This follows a 4.2 per cent average decline in prices for the first quarter of this year.

The central bank said high base effects may also have contributed to the drop in prices given the registered peak of the index in the second quarter of 2020.

“The [annual] contraction in the nationwide residential property prices was driven mainly by the downtrend of property prices in the National Capital Region, which fell by 18.3 per cent relative to the second quarter of 2020, marking four consecutive quarters of decline since the third quarter of 2020,” the regulator said, using the official name for Metro Manila.

The decline was caused by the drop in prices of single detached, condominium and townhouse units in Metro Manila.

“In the case of duplex housing, no bank loans were granted and reported to the BSP in the second quarter of 2021,” the agency added.

Similarly, property prices in areas outside Metro Manila decreased marginally by 0.6 per cent as the drop in the prices of single detached or attached houses more than offset the growth in the prices of townhouses, duplexes and condominium units.

By type of housing units, the price declines were largely driven by the fall in prices of condominium units and single detached houses.

The BSP added that the 9.4 per cent year-on-year drop in the nationwide property price index was primarily driven by the fall in prices of condominium units and single detached or attached houses, at 14.3 per cent and 7.4 per cent, respectively, in the second quarter of 2021.

“This is the fourth consecutive quarter that prices of condominium units declined, owing mainly to the lacklustre demand for condominium units in the National Capital Region,” it said. “In contrast, prices of duplexes and townhouses increased by 28.9 per cent and 15.1 per cent, respectively.”

In the second quarter of 2021, the number of real estate loans granted for all types of new housing units in the Philippines rose by 82.3 per cent.

The BSP also noted that the average appraised value per square meter of new housing units in the country contracted by 29.1 per cent. This trend was similarly observed in Metro Manila, while in provincial areas, the average appraised value per sqm of new properties rose.