MANILA – Ayala Land said its property sales have been "encouraging" in the first two months of the year, giving the company confidence it can at least match last year's growth.
Reservation sales grew 11 percent last year, down from the 25 to 30 percent of previous years. The company said there's a benefit to the more moderate pace.
Reservation sales is the value of property sold even if it will be paid in installment.
“The first couple of months continue to be encouraging. We're not seeing any kind of reduction in terms of demand in the market. The market remains quite healthy,” Ayala Land president Bobby Dy said on Wednesday.
“We're looking at high single digit, low double digit, those are reasonable growth rates and more importantly those are sustainable growth rates. What we're interested in is building a sustainable business. We're not interested in growing by 30 to 50 percent a year then the next year get in a situation where you are not able to grow. Or worse, not selling as much inventory,” he added.
Dy said the company plans to go from 45 cities and other "growth centers" at present to 70 in three to five years and is entertaining joint ventures to speed that up and keep costs down.
He said the company doesn't see a property bubble.
"When people talk about a bubble they typically look at a couple of things. One is, has there been rapid price appreciation in the market? That one, when I look at our products across the board, our price increases have been inflationary or a bit higher than inflation, so we're not seeing rapid price appreciation. The other one that we’re not seeing is a lot of speculative activity. In the high end segment which we have a meaningful presence, we’re not seeing people flipping the property or even a lot of leverage. Typically, people buy in cash for their own personal use or as part of their asset diversification," he said.
According to the Ayala Land president, there's a lot of middle-income property coming to market but this is matched by the growth in that segment.
He also said that for the company's Avida line, 25- to 34-year-olds used to account for 5 percent of sales. Now it's one-third.