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Buying a home amid the pandemic is indeed challenging. From minimal to no physical viewings to digital meet-ups between brokers and buyers, there are new norms formed that involve adjustments. Fortunately, property developers are stepping up to serve the market better.
Cebu Landmasters, Inc., for instance, the leading real estate company in the Visayas-Mindanao region, has been coping with ‘business unusual,’ as Joe Soberano, the company’s CEO, called it in the latest episode of Lamudi’s webinar series, Buying a Home Amid the Pandemic. Together with Lulu Meriguet, Lamudi’s Business Development Manager, they discussed the complexities of property investments during a crisis.
Here are some of the highlights of the episode:
Big Steps of Adjustments
Committed to customer service and industry growth, Cebu Landmasters strives to do what they’ve always been doing–build projects, sell, turn over, and manage, even amid the pandemic. Soberano, however, acknowledged that there’s a huge challenge in achieving targets that have already been fixed at the start of the year. For this reason, they’ve been recalibrating strategies.
“In Cebu Landmasters, we really would like to take this time to do a lot of planning. Plan, plan, plan. We strategize what to do under the situation we’re in and how we’re going to manage. So, strategize, strategize, strategize,” Soberano said. In terms of execution, he added that they strive to deliver excellent results amid the crisis.
Victory in Struggles
Despite the dire situation, Cebu Landmasters posted more than 20 percent growth in reservation sales in the second quarter, compared to 2019, the highest-grossing home sale. Soberano attributed this success to the active networking process their brokers have established. “We continue to communicate and connect with our buyers through our brokers and sellers,” he pointed out.
The company’s Casa Mira, catering to the economic market, and Velmiro, for the mid-market segment, are the most in-demand projects, amounting to around four billion pesos in reservation sales. Soberano said that the key to the strong take-up in these properties is communicating to the market the idea that a piece of real estate is an excellent investment amid the pandemic.
“We’re able to connect to buyers and deliver the message that only a home is the real advantage in this time of crisis,” he mentioned. He added that the value of the properties–being affordable and posing a great potential for an upswing in valuation–helped in enticing buyers. Compared to putting money in the bank, with interest rates currently dipping low, investment in real estate proves more promising.
The flexible terms of payment have been a huge come-on for buyers as well.
The Value of Need-Based Offerings
What makes Cebu Landmasters stand out from its competitors, according to Soberano, is it meets a need. “That need is the housing backlog we’re facing,” he pointed out. Soberano attributed the developer’s success in addressing the housing backlog to the network of brokers and agents they have established over the years, which have initiated and strengthened goodwill among the market.
At the same time, the property developer serves audiences that are already expecting them, which explains why their developments have been successful. Soberano noted, “There’s already some anticipation as we go into a new city.”
Cebu Landmasters’ philosophy of prioritizing needs when offering products extends to this time of crisis. Soberano said that they’re not hesitant to make changes in their developments, such as establishing medical facilities inside subdivisions, and offering bigger, open spaces in individual units. “This adds more to the comfort, convenience, and safety of residents,” he said.
Excellent property management is another factor that stems from Cebu Landmasters’ prioritizing market needs. When they turnover units, they remain responsive to residents’ concerns, even though the community already has a homeowners’ association.
“These are the kinds of reputation-building [initiatives] that give us that kind of edge, that the market is able to appreciate,” Soberano said.
Business Under Community Quarantine Restrictions
At present, Cebu is under the strictest of stay-at-home policies, the enhanced community quarantine. Soberano shared that despite these restrictions, Cebu Landmasters is able to continue with some of their construction activities, while observing health safety standards to keep their employees–and by extension, clients–safe. The company provides strong support for workers. For instance, those on-site have been tested, given allowance, and provided food. The people working from home, meanwhile, have constant communication with their teams through teleconferencing.
“We make sure that they’re well supported. To us, that’s a very important component in moving forward, that people are well-motivated,” Soberano shared. “We put special care on the people we have.”
Aside from empowering their employees, Cebu Landmasters strives for constant improvement in their operations. For this reason, they engage in thorough reviews of procedures, brainstorming ways on how they can be more efficient now and in the post-COVID future. Soberano mentioned that they’ve been improving backroom operations, monitoring receivables from over 15,000 accounts, for instance.
Another way Cebu Landmasters is coping with the lockdowns, particularly the absence of face-to-face meetings, is the use of digital platforms. “Our salespeople go to virtual tours, on websites. They show photos of present conditions of the homes,” Soberano said. This is one of the critical strategies that allowed the company to reach its sales goals.
With buyers stuck at home, growing more aware of what they want in a space, Cebu Landmasters was able to support that need with the use of technology amid the pandemic.
Flexible Payment Schemes
Serving property buyers further during this crisis, Cebu Landmasters offers flexible payment schemes. Soberano pointed out that they accommodated clients’ requests for deferments. “For new buyers, we look at what they can really afford. We have our price list, that’s already affordable as they are. But we are even open to hearing from them what else these buyers specifically want,” he shared.
He added, “We’re really looking at the situation on the basis of wanting to give that opportunity to these buyers to own homes.”
Opportunities in the Real Estate Sector
Inspiring other players in the industry, Soberano encouraged people to take on an optimistic attitude, while pointing out opportunities. “There’s so much to look forward to. The BPO (business process outsourcing) industry is still pretty strong. That will continue to strengthen as we move forward. As most economies in the world tighten up, a lot of outsourcing [activities] will be resorted to. The Philippines, as a country, with all our BPO, our wealth of manpower can definitely take advantage of that,” Soberano noted.
He also added that the vaccine will eventually be available. The construction activities happening at present can serve as a preparation for people diving into the market in the future. However, he reminded, “It has to be a healthy balance between doing your capex and having a lot of cash. Right now, in a time of crisis situation, you need to have that liquidity, to prepare yourself.”
Reiterating that optimism is key, he said, “In every crisis, there’s always going to be an opportunity. In the case of Cebu Landmasters, this was an opportunity that was set up years ago, because we’ve always looked at the backlog and the strength of housing. We, in fact, discovered it even more now, with the performance that we had in home sales.”
“There’s so much negativity that comes about. But as a developer, I just think, there’s so much upside to think about. We just have to manage ourselves very well. If you have to look at your own organization, you may want to review that very carefully,” he added.
Wrapping up his advice, Soberano echoed the importance of putting first the three most important people in the company’s operations: the buyers, employees, and the community.
Advice for Property Buyers
Although these are uncertain times, it pays to invest in property, according to Soberano. People are able to enjoy privacy as well as versatility, having their own place for different uses, such as personal businesses. He added that now is the best time to do it, precisely because the interest rates are low.
“It’s going to be very affordable,” Soberano said. “We’re talking about a monthly amortization of about P5,000 to P10,000. For example, you’re a young couple, you’re talking here of a combined income of P30,000 to P40,000. About 20 percent of that is going to be set aside for buying, eventually owning a home.”
On the investment side, meanwhile, property purchases today make sense. “I think it’s the best way to put your money [to good use]. It’s a price that’s affordable, and it can definitely appreciate over time.”
“If you have an idea of flipping it in five to 10 years, definitely, there’s going to be value appreciation there, some income for you. Or, you can also just look at this on a purely rental basis,” he added.
The Future of Cebu Landmasters
What’s next for the Vis-Min developer? Soberano zeroed in on their three-pronged new normal approach, “I mentioned planning, strategizing, and executing. Those are three magical action points we’ll continue to push through,” he said.
Moving forward in the second half of the year, he mentioned that they’ll be launching 12 projects. The launch, of course, won’t be traditional, given the social distancing protocols in the area. But he pointed out that the launch will spur pre-selling and building activities. “We’re seeing a lot more activities both on the selling and construction side. That’s how Cebu Landmasters will continue,” Soberano shared.
As for the growth forecast, the company prefers to lean on the conservative assessment. “This could be a year that we will see more pluses than minuses. It’s pretty surprising that we’re able to manage it now, with the circumstances we’re facing,” Soberano noted.
For the projects that wouldn’t see construction yet, he pointed out that they will be under planning and review. “[We will] see how things move in the next few months, how COVID will continue to affect us, and see if we’re going to execute these projects that we planned and strategized sooner or later.”
The health crisis has indeed presented difficulties in property buying. Fortunately, real estate developers are taking action, leading the movement to embrace the new normal to accommodate seekers’ needs. With this, the industry only grows further and propels forward.