List Sotheby’s International Realty (List SIR) jointly organised a real estate market dialogue on 1 August 2019 with CitiGold at the Marina Mandarin hotel in Singapore and saw a huge turnout of more than 100 guests.
During the dialogue, CitiBank’s Mr. Lo John San spoke about the current economic outlook. Following him was List SIR’s Ms. Han Huan Mei and Ms. Alice Tan, who shared with the guests their views on the Singapore property market and other new opportunities and trends in real estate. Philippines was also a special guest for the event. Ms Patricia Cruz, Vice President for Sales and Broker Partnership also shared her insights on the country’s investment landscape.
An archipelago of over 7,100 islands covering more than 120,000 square miles, the Philippines has one of the fastest growing economies in Asia. The Gross Domestic Product (GDP) growth in the Philippines has been among one of Asia's fastest. The country has sustained an average annual growth of 6.3 per cent between 2010 – 2017, up from an average of 4.5 per cent between 2000 – 2009. Economic growth reached a high of 6.7 per cent before moderating to 6.2 per cent in 2108 from the effects of lower growth in global trade and high inflation. Still that performance puts them ahead of other Southeast Asian countries such as Malaysia and Thailand. In 2019, growth is projected to reach 6.4 per cent.
The Philippines is also one of the top ASEAN countries in terms of Foreign Direct Investment (FDI), and has seen a continuous increase in its FDI for the past seven consecutive years.
The largest share in FDI can be attributed to investments from the manufacturing sector, real estate as well as financial and insurance activities. The Philippines government’s initiative to continuously formulate more policies aimed to increase the ease of doing business in the country provided further expansion to the economy.
On top of that, the country has embarked on one of the biggest government initiatives – the ‘Build, Build, Build’ programme – to retain investments and attract more FDI.
Spearheaded by the Duterte government, an estimated US$180 billion will be spent to overhaul the infrastructure of the country. The 75 projects include six airports, nine railways, three bus rapid transits, four seaports and 32 roads and bridges.
The ‘Build, Build, Build’ programme is set to further improve the Philippines economy by bringing down costs of production, improving rural incomes, encouraging countryside investments, making the movement of goods and people more efficient, and creating more jobs.
The Philippines residential market is set to benefit from all these drivers. The high influx of expatriates from the continuous growth of Business Process Outsourcing (BPO) companies, the off-shore gaming industry and other traditional companies surpassed the supply of new properties available in the market.
Real estate in the Philippines offers a higher yield in comparison to other Asian countries. This is another factor how they have been successful in attracting foreign investors.
The Philippines real estate outlook remains positive as it continues to face growth expansion from the office, leasing, residential and hospitality sectors. Major residential developments are expected to be made available in the next couple of years in progressive cities such as Mandaluyong City, Pasig City, and Quezon City due to the strong demand from upper-mid to luxury market segments.