Residential real estate prices edge up in Q1 2017

ShutterStock photo

MANILA — Residential real estate prices rise 1.1 percent in Q1 2017.

Residential real estate prices went up by 1.1 percent in Q1 2017, as the Residential Real Estate Price Index (RREPI) rose to 117.2 from 115.9 for the same quarter a year ago.

The year-on-year growth in residential real estate prices in Q1 2017 was slightly higher compared to the 0.3 percent increase registered a quarter ago.

The growth in prices of condominium units was faster at 2.7 percent (from 1.8 percent in Q4 2016) year-on-year while those of single detached units edged higher at 0.4 percent, recovering from a 1 percent decline in the previous quarter.

Meanwhile, those of townhouses slowed down to 1.3 percent from 6.2 percent a quarter ago.

RREPI measures the average change in prices of various types of housing units comprising of single detached/attached house, duplex, condominium, and townhouse based on data from housing loans granted by commercial, universal, and thrift banks.

The RREPI is computed as weighted chain-linked index based on the average appraised value per square meter weighted by the share of floor area of new housing units.

RREPI in the National Capital Region (NCR) and Areas Outside NCR grows at a similar pace.

The average residential property prices in both NCR and AONCR also increased by 1.1 percent in Q1 2017 compared to year-ago prices.

In NCR, growth in real estate prices reverted to positive territory from a negative growth in Q4 2016 while those in AONCR moderated for the same period.

The higher growth in prices of single detached houses and townhouses in NCR outweighed the slower increase in prices of condominium units.

Meanwhile, in AONCR the double digit increase in prices of condominium units offset the slight decline in prices of single detached houses and townhouses.

Profile of residential real estate loans for Q1 2017

For Q1 2017, about seven in ten real estate loans were for the purchase of new housing units (69 percent). By type of housing unit, 48.4 percent of residential property loans were for the acquisition of condominium units, followed by single detached units (43.3 percent) and townhouses (7.9 percent).

The number of loans granted increased for all types of housing units compared to their year-ago levels, with condominium units posting the highest growth of 26.9 percent.

By area, condominium units were the most common house purchases in NCR while single detached houses were prevalent in AONCR.

By region, NCR accounted for 44.8 percent of the total number of residential real estate loans granted during the quarter, followed by CALABARZON (29.3 percent), Central Luzon (6.7 percent), Central Visayas (5.7 percent), Western Visayas (5.

1 percent), Davao Region (3.2 percent) and Northern Mindanao (1.5 percent). Together, these seven regions accounted for 96.3 percent of total housing loans granted by banks.

About the report

Under BSP Circular No. 892 dated Nov. 16, 2015, the BSP requires all universal/commercial banks (UBs/KBs) and thrift banks (TBs) in the Philippines to submit a quarterly report on all Residential Real Estate Loans (RRELs) granted for the generation of RREPI.

Out of the 101 banks covered, 99 banks or 98 percent (consisting of 42 U/KBs and 57 TBs) submitted their reports to the BSP which cover the first quarter of 2017.

The residential real estate price index (RREPI), which is estimated every quarter based on housing loans granted by banks, is a first in the Philippines and is expected to provide a valuable tool in assessing the real estate and credit market conditions in the country. growth rate of the index measures house price inflation.