We only have nearly 5 months until the end of 2022, and we had seen how our country was able to adapt to the effects of the pandemic. Numerous new trends and innovations were introduced in the early months of the year in order to adapt to the emerging real estate industry demands. The trends are how we show investors and developers that we can earn their trust and partnership in the midst of a pandemic.
The Philippines had a rough start in 2022 due to an increase in daily positive COVID-19 cases caused by the Omicron strain. However, as infection rates began to plateau and decline, the government relaxed restrictions, bringing the country back to what appeared to be pre-pandemic normalcy. As a result, the demand for warehousing, logistics, and supply chain solutions has increased. Recent global events, such as the non-synchronized opening of key port destinations and volatile oil prices exacerbated by the ongoing Russia-Ukraine conflict, are likely to put a damper on the manufacturing and logistics industries’ continued growth.
Furthermore, one of the outcomes of the pandemic’s current norms is a more responsible and wiser financially literate Filipino individuals. People are becoming more discerning and knowledgeable about where they invest their hard-earned money, which bodes well for the real estate industry’s future growth. Nonetheless, this article outlines current market trends in the Philippine real estate industry for 2022.
1. Dollar-earning Filipinos are Expected to Increase their Real Estate Investments
As the value of the Philippine peso falls in tandem with the current US dollar exchange rate, the amount of money sent to families by our dollar-earning citizens shoots up. Dollar-earning Filipinos include but not limited to the following: those who work in the Business Processing Outsourcing (BPO) industry, Online Virtual Assistants, and Overseas Filipino Workers (OFW). It is easier to own a condominium or buy a house when you have more financial resources. It is entirely up to you whether this is a private space or a business opportunity.
Following that, more real estate investment is expected to be driven by the BPO industry in 2022. The leasing of condominiums and other properties is expected to increase over the next 18 months as more foreign companies turn to the Philippines for offshoring and outsourcing.
Furthermore, as our Gross National Product (GNP) reports that the Philippines is one of the world’s largest recipients of foreign remittances. Overseas Filipino workers sent $29.9 billion to their families in the Philippines in 2020. The figures continue to rise year after year, allowing many Filipinos to purchase real estate properties.
Read Also: What Documents do You Need to Buy a Lot in the Philippines as an OFW? | Bria Homes
2. More Foreign Investors for Real Estate
Foreign investments in the country totaled Php36.49 billion at the start of the year. The United States pledged Php13.4 billion, while Taiwan and Japan pledged Php4.4 billion and Php4.3 billion, respectively, according to the Philippine Statistics Authority. Furthermore, approved projects are expected to create 24,239 jobs.
According to experts in order to compete in the new normal setup, some of the industry’s basic operational and strategic assumptions must be seriously reconsidered, which is aimed to capture emerging growth trends amid the various headwinds that have so far defined early 2022, stakeholders in the Philippine real estate industry must embrace a paradigm shift. The recent amendments to the laws governing foreign investments and retail trade liberalization are timely contributions to the government’s effort to stimulate economic growth by relaxing the requirements and limitations that prevent much-needed foreign investor participation.
3. Emergence of Green Co-Working Spaces
One of the difficulties that the pandemic has presented to interior designers is the ability to fill voids in empty rooms in order to foster creativity without taking up much space. Co-working spaces were one of the constant innovations planned by these interior designers in order to improve continuity planning for businesses and reorganize the workforce setup while reducing real estate costs such as rent. To meet social-distancing requirements, it had reduced capacity, created buffer zones, and reinforced cleaning and personal hygiene practices.
The pandemic has prompted businesses in Metro Manila to adopt sustainable workspaces, increasing office leasing demand. In fact, it is expected that approximately 37% of new buildings that will open in the next few years will be wellness-certified structures.
What’s exciting is that this represents the beginning of a shift toward sanitary redesign. Copper, which is more sustainable and has antibacterial properties, will most likely replace iron and steel materials. Ventilation systems will be installed to direct airflow downward rather than upward from the floor. Furthermore, the pandemic has made hand sanitizers a necessary office item.
4. Number of Real Estate ‘Millennial’ Buyers Further Increases
Those born between 1981 and 1996 are referred to as “Millenials,” which means “a person reaching young adulthood in the early twenty-first century.” They are stereotyped as narcissistic, lazy, and entitled, as they frequently change jobs and enjoy life through shopping, travel, and gadgets. According to Philippine Statistics Authority data, millennials (aged 25-34) account for approximately 28 percent of our country’s workforce.
According to surveys, the majority of potential home buyers are millennials aged 25 to 34. This can be attributed to their proficiency with technology. The coronavirus pandemic appears to have influenced their spending habits, prompting them to invest in home ownership. According to a Forbes article, technology is important in the home-buying process because millennials use the internet and mobile devices extensively when researching their options. It also highlighted the preference of millennials for suburbs over cities. Due to the convenience and accessibility provided by condominium properties, real estate is an appealing investment for millennials.
Read Also: The 3 Best Reasons to Develop the Habit of Saving Money | Bria Homes
5. The Rise of Microcities
Microcities, like Cebu IT Park in Cebu, are “cities within cities” designed to attract the demands of millennial residents. These are clusters of residential and commercial buildings designed to provide amenities such as groceries, malls, gyms, salons, and the like. These areas are packed with cutting-edge amenities and designed to meet the needs of the twenty-first century. With millennials hopping from one job to the next, developers have built communities where these young workers can live, play, and settle down all within walking distance of their workplace.
The constant growth of technology-based microcities creates new opportunities for businesses and jobs. Traditional manufacturing and routine cognitive skills jobs are dwindling, and the development of new sources of employment and growth is critical in maintaining competitiveness, reducing poverty, and increasing shared prosperity in order to mitigate the pandemic’s effects. “Urban tech” and “smart cities” technologies are altering how residents interact with city services and navigate their public space.
In summary, the Philippines’ real estate industry is improving during the recovery phase of a pandemic, but the outlook remains uncertain. As we face rising oil prices, taxes, and building material costs, local real estate experts predict that the property industry will see sustained growth in the coming years, with both the public and private sectors gradually advancing their innovations to usher in economic recovery by attracting investors and developers.
