Doomsters attempt to pour cold water on the Philippine Property Market
Despite the usual press releases and denials from so called international property managers and purveyors of doom, demand for property in the Philippines will not dry up
The Philippines remains one of the preferred markets in the South-East Asia where mid-range property prices are only 15-20% of those found in London, New York, Paris. Demographics of property buyers in the Philippines are substantially different from nearly all other countries and encompass a growing trend of foreign retirees from all over the world whom take advantage of the relatively low cost of living, lower medical expenses and tropical climate thanks to the efforts of the Philippine Retirement Authority.
Beth Collingz, overseas marketing director of PLC Global, lead marketing partners for the Lancaster Brand of Condo Hotels in the Philippines said whilst the low end mass housing domestic market may take a hit due to thousands of lay offs and redundancies in the electronics export manufacturing sectors of industry, the mid and high end luxury real estate sector will not experience a lowering of demand simply because there are very few factory workers whom buy this kind of real property in the Philippines.
Philippine Bank’s are awash with cash and lending to property developers, end users and consumer financing is not affected by any external global crisis. Non-resident or resident Foreign Nationals married to Filipino Citizens can avail of mortgage loans. Philippine developers grant no-qualification extended payment terms or ‘In-house’ financing for all buyers of off plan or pre-construction properties.
There continues to be a limited supply of new property in all sectors of the market. High level demand for mid and low range housing and condominium units from both overseas and local buyers. Continued low supply of office and commercial properties and despite a steady increase in Tourism related development there is still a low supply of Hotel rooms.
Much fuss in the press is made about overseas Filipinos doom and gloom and a supposed slow down in buying property back home but these people are not the only buyers of real estate and many are selling up and abandoning the gloom and doom in the US and elsewhere and returning to live and buy property in the Philippines. More over, overseas Filipino workers are not affected by the Global Credit Crisis as, in the majority; they are not employed in manufacturing sectors but in medical services as nurses, care givers and med-tech assistants. Thousands of Filipinos continue to leave for abroad every month and are still the preferred choice for seamen and in the services industry and inward remittances from this sector remain on the increase.
There is an immediate demand for residential property at all property price ranges. Foreign nationals will continue to be attracted to property in the Philippines because of its relative low cost of living and political stability. The best investment returns are actually going to come out of Asia and emerging markets - the US's day in the sun is certainly over. Investors are moving to new areas to find value said Collingz "More and more of clients for buy-to-let Condo Hotel Investments are coming from the UK and the Middle East. There has been a distinct market shift from US based clients over the past few months and we see that trend continuing throughout 2008 well into 2009.
“A lot of this interest is being driven by the relatively cheap market prices in the Philippines compared to Europe, 100% financing availability and easy no down payment options available for our Condo Hotel Developments, but there are other factors, too. Offshore Property Investors, Foreign baby boomers as well as overseas Filipinos, are looking for ways to maximize their return on investments as they approach retirement, and so are purchasing second homes, particularly Condo Hotel Investments where they can use the Condo for vacations and rent it out through our In-House Condo Hotel Management when they are not using the unit thereby gaining rental incomes that on today’s purchase prices, give a projected ROI on their investments of some 8-14 percent depending upon the mode of payment for the unit”
Collingz maintains the global crisis presents itself as an opportunity for the country to put its best foot forward and be noticed. We just have to do what we have to do, and rise to the occasion. As luck would have it, the global credit crunch tends to highlight the unique advantage of the Philippines as a destination for foreign investments and tourism. It is just a matter of marketing the country all the more vigorously. We have to find alternatives to whatever markets or foreign investors that we may lose. And we will get them in droves. If you know your trade and you are offering a good product “the market is here to stay so why rock the boat” she said, even as she advised investors to become more astute in their choice of investments.
“People have to realize that markets, especially in real estate, go in 10 year repetitive cycles. Compared to today’s situation, we have had far worse to contend with in the past two cycles the real-estate industry in the Philippines and South-East Asia in general, has experienced. It was by far worse times during the late ’80s and the devastating effects of the Asian financial crisis near the end of the ’90s with a very limited market base” said Collingz.
With the arrival of the internet and communications technology, the whole world suddenly became our market in the Millennium. It is now a global market and with our Condo Hotel developments, sales volume from among near 15 million Filipinos abroad combined with foreign investors from Asia, Europe and the Middle East, remains on the increase.
In order to maintain sales momentum, current marketing trends simply have to change. If you compare the situation in the late ’80s to today, people forget the telex machine had just become redundant and communication was limited to sending a fax offer to buy real estate. A top of the line computer was Apple IIE. Cellular phones were few and far between and the internet was not even around. Ergo, Philippine real-estate investors were merely comprised of wealthy local Chinese businessmen.
During the late 90’s Asian Crisis, not many people used the internet. Now it’s 2008 and a very different ballgame. Today’s technology, unheard of 15 to 20 years ago, has for the most part contributed to sales and marketing efforts of developers and will continue to do so. It is the communication factor that will drive sales of Philippine real estate upwards through 2008 well into 2012 and beyond. Now I receive daily calls and numerous emails from prospective buyers in Australia, Hawaii, New York, Doha, Dubai and the UK. I even get calls from clients located in Fiji and Mauritius. During the previous crisis years I didn’t get any. To maintain sales, its really a simple matter of being organized, having a great development to market with global appeal, an excellent developer, focus, mind set, intelligence, time, enthusiasm and dedication said Collingz whose company has been consistent top producer for the Lancaster Brand of Condotel Investments in the Philippines year ending 2005, 2006, 2007 and 2008.
Whilst some agents dwell on the number of Philippine properties bought by Filipinos based in the US has began to fall because of the credit crunch, it is a blow but not significant as there are new investment clients out there and we do not focus on the US as a sole marketplace for our sales said Collingz.
“Global investors are looking to replace failed pension plans and other future saving schemes with a solid investment in real estate. Many are looking for investments that will give them an income for retirement. Savvy investors are now looking for a more solid investment with potential for monthly income and Philippine Condo Hotel investments are ideal because Philippine Hotel rates are the same if not more expensive than those in the US or Europe but the entry level to purchase real estate is only about 10% of what you would have to pay for a Studio in Manhattan” credit crunch or not she added.
Further fuelling real estate development is the fact the Philippines remains undiscovered as far as British and many European investors are concerned. Yet because of its close links to the US, English is widely spoken and it is well regarded for its people, affordable living, beaches and diving. It’s a whole new market enthused Collingz. “Buying property here is easier than many people think and investment from overseas in tourism real estate is growing, especially in the resort areas of Cebu and Manila itself where rental potential is good”.
However, anyone considering Philippine Real Estate Investments should move at this moment and lock in at current price levels said Collingz. Buyers whom reserve now can take advantage of current prices locked in for their units and see an immediate equity return on their investment said Collingz.
Thanks to the Philippine real estate sectors own safety nets for installment sales; to our conservative banking system for adhering to sound policies that limit exposure to high-risk ventures, thus minimizing their non-performing loans and assets; to the government for its commitment to continue stimulating and pump-priming the economy while keeping inflation in check. All these amount to continued rise in real estate, housing and construction projects in the Country today.
Lancaster Manila Atrium Tower A, Shaw Boulevard, Metro Manila, Philippines is a "Full Service" Condominium Hotel offering Studio, One, Two and Three Bedroom Suites for sale with the option of enrolling their units in the Lancaster Condo Hotel Rental Pool and earn Rental Incomes as Owner Non-Residents when not using their units through Condo Hotel Management and reciprocal arrangement with Lancaster Cebu Resort Residences. This makes Lancaster Suites Manila, one of the Hottest Investment Opportunities in the Philippines said Collingz.
For further info regarding Lancaster Philippines Condo Hotel Investments please do not hesitate to contact us....
PLC International Marketing Networks
Pacific Concord Properties Inc.,
Manila Head Office
Shaw Boulevard, Mandaluyong City.
Metro Manila. Philippines
Phone: Manila  717 1958
Fax: Manila  718 1828
Pacific Concord Properties Inc.,
Cebu Branch Office
Lapu-Lapu City, Mactan.
Phone: Cebu  340 0721
Fax:  495 4938
Web: http://www.lancastersuites.com/ [Lancaster Condotels]
Web: http://www.condotel-manila.com/ [Lancaster Suites]
Web: http://www.condotel-sales.com/ [Lancaster Atrium]