Find out what 2013 has in store for the local real estate industry with ULI’s report.
The Urban Land Institute (ULI) recently released their property development predictions for 2013 entitled Emerging Trends in Real Estate®. The Asia Pacific version provided some very interesting analyses about the Philippine real estate market, all of which are relevant in understanding the present local property scene, as well as what may need to be done in order to see a definite boost in the industry.
Here are some of the highlights of the report:
The Philippines as an emerging real estate player
Foreign investors are seeing the Philippines as a “frontier market”. Although there is said to be a long list of risks connected to investing in real estate in the country (small scale, prevalent corruption, lengthy holding periods, etc.), the benefits are just as numerous (prime land, high internal rate of return, properties as “low hanging fruit”, etc.).
The present Philippine real estate market in a nutshell
Currently, the Philippines is seen to have experienced strong growth and has garnered a reputation for transparency, which are its main advantages. Largely responsible for driving local real estate forward is the business-process outsourcing (BPO) industry, which is said to take up 70-80% of new offices in the country. On the other hand, investing in the Philippines might be tricky for foreigners as law requires that they have a local partner who will own majority of the property. Although certain changes to this requirement are under way, they may not be put into effect until 2016, when a new administration is in place.
Manila as a real estate investment hotspot
In the past years, Manila has always found itself near the bottom of the list of investment destinations. However, the capital is now climbing up the ranks due to recent improvements in the Philippines (economic growth, transparency, and the increasing presence of foreign companies due to BPO facilities). It is reiterated, though, that international investment is hindered by the local majority ownership law.
Thumbnail courtesy of Wayne Ruston