Wednesday, June 10, 2015
Top Countries Investing in Philippine Real Estate
Global property portal Lamudi Philippines looks at the top countries that make the Philippines one of the top property investment markets in Asia
The local and international markets are eyeing the Philippine real estate sector as a strong and lucrative venture.
Some of the compelling reasons that secure a foothold for the Philippines in the property investment scene can be attributed in the strong presence of business process and information technology outsourcing in the country, and the relatively low prices of real estate properties compared to other regions.
Likewise, the Philippines continues to capture foreign market due to the country’s positive demographics, GDP growth, and strong assets inflows from overseas Filipino workers.
In 2014, Manila bagged the fourth ranking out of 23 Asian cities in terms of city investment prospects, according to a survey by the U.S.- based Urban Land Institute (ULI) and PricewaterhouseCoopers (PwC). Metro Manila closely follows Tokyo, Shanghai, and Jakarta, who occupy the top three positions, respectively.
Dubbed “Emerging Trends in Real Estate Asia Pacific,” ULI and PwC report likewise revealed that investors are increasingly willing to invest in emerging markets, such as Manila and Jakarta, instead of traditional markets, such as Hong Kong and Singapore.
Foreign residential ownership and office leasing
Despite foreign restrictions on land ownership, the consistent performance of the Philippine property sector and its booming economy still captured the interest of international stakeholders. This prompted most developers to come up with internationally inspired developments or use globally known brands to attract overseas demand.
In a 2014 report by Reuters, officials from leading developers, such as Ayala Land, Megaworld, and Century Properties, identified Singaporeans, mainland Chinese, Japanese, South Koreans, and Malaysians as the top foreign buyers of condominiums in Metro Manila.
As the outsourcing industry remain bullish, on the other hand, foreigners leasing office spaces continue to increase as well. Although most are concentrated in the metro, foreign firms setting up local offices are slowly spilling over to “new wave cities,” such as Cebu and Davao, prompting developers to build more commercial real estate in these areas.
Strong overseas demand for real estate equals steady foreign investment inflows
According to data from the Board of Investments and the National Statistical Coordination Board, the main contributing countries to foreign direct investment inflows for 2014 are the following: the Netherlands, who at the top spot contributed 24.1 percent or Php23 billion. Japan and the United States occupy the second and third places, who pledged Php20.9 billion and Php9.7 billion, respectively. For real estate and construction, 8 percent (Php7.6 billion) of the total FDI was allotted.