Wednesday, July 3, 2013
THE construction and real estate sectors are projected to remain upbeat this year on the back of robust property development across Central Visayas.
“The construction and real estate sectors will contribute significantly to the growth of the regional economy in 2013. Construction activities are projected to further pick up as the public sector invests in big-ticket projects to complement investments from the private sector,” the National Economic Development Authority (Neda) 7 said in its Central Visayas Economic Situationer 2012 report, which was recently released.
The sectors’ robust growth last year was attributed to the expansion of activities in the region’s leading industries like IT and BPO, retail trade and tourism. The two sectors also benefited from the steady demand for real property from overseas Filipino workers.
“OFWs seem to consider real properties as good investments for their hard-earned money,” Neda 7 said.
The report said there were a large number of new projects given construction permits last year compared to 2011.
Citing data from the National Statistics Office (NSO), Negros recorded the largest number last year at 277 new construction projects, while Cebu recorded 153 new projects.
The NSO said 87 percent of the new construction projects of the private sector were for residential use. Thirteen of 24 projects that were registered with the Board of Investments (BOI) last year were in mass housing and hotel construction. The BOI said the 13 projects totaled P4.3 billion in investments, which represent 10 percent of the total investments registered in their office in 2012.
Residential projects
Neda said that in Cebu alone, the real estate sector logged a revenue growth of 18.8 percent in the third quarter last year. The market was dominated by residential properties.
Data from the Housing and Land Use Regulatory Board (HLURB) showed 5,212 units valued at P5.17 billion from 14 residential condominium projects were issued licenses to sell last year. All these condominium projects are located in Cebu.
According to Neda 7, the market for residential condominium is targeted to expand further in the next few years as 100 condominium buildings are projected to be completed by 2015 and another 170 to 200 buildings are expected to be finished by 2017.
For the open market residential subdivisions, HLURB recorded 22 projects that were put on the block in 2012, valued at P2.6 billion. Of the 22 projects, 15 are located in Cebu and the rest are located in the provinces of Negros Oriental and Bohol.
Credit access
Aside from the strong inflow of remittances and accelerated developments of various industries, the agency said liquidity in the market through the availability of credit and financing support from banks also fueled growth in the region’s construction and real estate sectors.
It said the partnership with private developers and government agencies such as Pag-ibig boosted demand for real estate properties, particularly for affordable housing units. It added that the move by Pag-ibig to double its loanable amount from P3 million to P6 million and to lower its monthly interest rate from 10 percent to 7.98 percent also helped develop the affordable housing sector.
The report also cited tourism, retail trade, IT/BPO and KPO as among the major industries that performed well in 2012. Exports also turned in a positive performance, despite the weak global economy. Agriculture, however, was not able to sustain the growth it posted in 2011.
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