Remittances, low interest rates to boost property market
MANILA, Philippines - Sustained strength of remittances from overseas Filipinos and the low interest rates will continue to buoy the property market, according to the chief of Filinvest Land, Inc.
"Definitely, the remittances from OFWs (overseas Filipino workers) are the main driver [of the real estate sector]... Also, low interest rates that have been coming into play," Lourdes Josephine Gotianun-Yap, Filinvest Land president and chief executive officer, told ANC Inside Business.
The low interest rate environment made housing more affordable, Yap said.
When asked if her firm is cautious of a possible real estate bubble as property prices continue soar, Yap stressed the increase in rates has only been observed in the high-end or luxury market.
"I believe the increase in housing prices is more focused on the higher-end of the market as you have seen increases [in house prices] in some exclusive subdivisions," Yap said.
"But for the affordable property market, it is constrained by the affordability so you really cannot say that prices go up very fast," she stressed.
Despite the bullish business process outsourcing (BPO) sector foreseen to drive growth in the property sector, Filinvest Land will continue to focus on residential projects in the coming years, Yap shared.
"Our core product is still housing... as far as we're concerned, we have always been focused on the regular Filipino family and user market," Yap said.
Filinvest Land booked P1.967 billion in net income in the nine months to September, up 18% as the firm realized higher revenues from real estate sales.
The Gotianun-led property firm, which has launched six new projects and eight additional phases of existing projects this year, earmarked P15 billion for its 2012 capital expenditures meant for the construction of residential projects, office and retail space.