In Lamudi’s online roundtable, On the Horizon: Real Estate Leaders on Market Recovery, thought leaders agreed on one of the most important features of the property industry today: the market is resilient amid the pandemic. Despite the slowdown in activities, the sector is on its way to recovery. Nonetheless, there are challenges ahead, which come from sweeping changes brought by the crisis. It’s up to the real estate players to propel the market forward.
This is the focal point of the third track of Lamudi’s online event. Titled Redesign: Buoying the Market through Changes, the discussion featured facilitator Mark Bailey, Corporate Accounts Lead of Lamudi, along with the panelists Joey Bondoc, Senior Research Manager of Colliers International Philippines; Tek Samaniego, Editor of Philippine Daily Inquirer Property; Raphael Felix, Chairman of the Board of Subdivision and Housing Developers Association and President and CEO of Phinma Properties; Tomas Lorenzo, President and CEO of Torre Lorenzo Development Corp.; and Emma Imperial, Group Chair and CEO at Imperial Homes Group of Companies.
Immediate Impact of the Pandemic
Kicking off the discussion, Lorenzo shared they had to embrace a virtual shift when the pandemic hit. “We have to move digitally for our sales. It led to a transformation for our corporation to go digital from the usual brick and mortar flyering,” he said.
Imperial affirms Lorenzo’s sentiments, saying that they adopted digitalization themselves. She also emphasized that their product, solar-powered residences, became more relevant at the height of the pandemic, noting the fact that people have spent more time indoors.
Meanwhile, Felix mentioned finances, as the greatest challenge for developers during the pandemic. The pause in construction activities for months had a significant impact on cash flow.
Acknowledging such a challenge, mentioning the slower take-up in the latter part of March, Bondoc still finds an opportunity. “We’re seeing a demand that is coming from a lot of segments. You have students and employees. They’re looking for safe, healthy buildings all over Metro Manila.”
He also sees a movement of investors considering areas outside the capital region.
Meanwhile, Samaniego enumerated the new preferences of property seekers. Mixed-use communities have become more popular.
Trends Shaping the Industry
While looking at the increased demand from the student market segment mentioned, Lorenzo identified new preferences among buyers. “Besides the usual location, product quality, amenities, and building management, they’re looking for, for example, the best high-speed internet that you can offer,” he shared.
Vast open spaces, which allow residents to practice social distancing without a hassle, have become popular as well, according to Lorenzo. Given that technology allows people to work remotely, more have become interested in living outside Metro Manila.
Meanwhile, health, safety, and security are the new priorities Samaniego sees in most property seekers. “There are those who prefer to have a satellite clinic within their community,” she mentioned.
In terms of the state of market segments, Felix asserted that all are doing well, from the high-end to the affordable. The latter saw pre-ECQ sales rates as early as mid-April in Phinma Properties.
On demographics, he added, “A lot more millennials are now buying. We used to have an average age of 30 to 40. Our 20 to 30-year-old market segment has doubled in the last three months.”
Shifting to office real estate, Bondoc said that a lot of Metro Manila enterprises are planning to expand operations outside the capital region as part of business continuity. “They’ve been expanding to Cebu, Iloilo. We’re also getting queries for Pampanga,” he said.
Industry Recovery in 2021
While recognizing the changing demands of the market, Imperial said that technology will form a big part of constructing communities as the economy moves forward to recovery. She hopes to increase productivity in their operations next year, still capitalizing on innovations, as banks open letters of credit.
For Lorenzo, the plan of action towards recovery is direct, transparent communications with clients. “It’s really about making sure that you take care of your buyers, that you keep them informed, that you tell them what’s going on,” he said.
Optimistic that the last quarter of the year will not experience a slowdown, Felix pointed out that there’s so much pent-up activity that did not happen throughout the year. The challenge, according to him, will be the buyer financing.
“This is one key important thing for us developers right now, that the banks start lending. I’m talking about consumer, end-user financing to the housing buyer. Make that go on and watch this market take off,” Felix said.
Turning to economic measures, Bondoc identified several factors that can help contribute to industry recovery.
“If you look at foreign direct investments, they grew in May 2020. The unemployment has eased to 10 from 17 percent back in April 2020. The central bank has raised real estate loans from 20 to 25 percent limit. OFW remittances finally rose in June 2020 after three consecutive months of decline,” he pointed out.
Positive Outlook for the Industry
As the country relaxes its quarantine measures, Samaniego has high hopes for the property industry recovery. “I’m hoping that our developers can provide high-quality, value-for-money developments that will allow us to remain resilient, to be able to live safely and achieve that well-balanced lifestyle,” she said.
Imperial, on the other hand, is eager to accommodate the growing demand for solar homes. She mentioned, “The buyers now are demanding if they can have a feature that can save them money.”
Sound Advice for the Market
For property seekers who are weighing which real estate projects they should invest in, Lorenzo advises end-users to do some “soul-searching,” assessing what their lifestyles require. “It’s not a matter of going out and just buying whatever they see advertised, but rather to really reflect what they need.”
Meanwhile, for investors, Bondoc emphasized the promising gains from residential projects, which are currently available at promising prices. He highlighted the value of investing in developments outside Metro Manila as well.
Wrapping up the session, Felix advises investors planning to buy property either for residence or income to push through with the purchase. “Buy a property because it’s a sound investment,” he urged.
Watch Lamudi’s panel discussion on our YouTube channel here.