House prices up 6.5% in Q4 2023 — BSP

Residential real estate prices across all types of housing units increased by 6.5 percent year-on-year in the fourth quarter of 2023, according to the latest Residential Real Estate Price Index (RREPI) of the Bangko Sentral ng Pilipinas (BSP).

The fourth quarter 2023 house prices however was lower than the 12.9 percent growth in the third quarter 2023. This means that on a quarter-on-quarter basis, the RREPI contracted by 3.6 percent, reversing the 3.4 percent growth in the third quarter, said the BSP on Wednesday, March 27.

The RREPI, which is a BSP tool to assess the real estate and credit market conditions in the country, measures the average change in the prices of various types of housing units such as single-detached/attached houses, duplex housing units, townhouses, and condominium units.

The chain-linked index, first introduced in 2016, is also based on banks’ data on actual mortgage loans granted to acquire new housing units but does not include pre-owned or foreclosed properties.

The BSP reported that by area, residential property prices increased year-on-year in both the National Capital Region (NCR) and in areas outside of the NCR.

The NCR house property prices went up by 4.3 percent in the fourth quarter 2023 as the growth in the prices of single-detached/attached houses and townhouses outweighed the decline in the prices of condominium units, said the BSP. Residential property prices in areas outside of the NCR also increased by 7.8 percent.

On a quarter-on-quarter basis, residential property prices declined by 9.4 percent in the NCR and 1.2 percent in areas outside of the NCR.

In terms of prices, single-detached/attached houses posted the highest year-on-year growth rate in the fourth quarter 2023 at 9.5 percent. This was followed by  townhouses at 4.9 percent and condominium units at 4.1 percent. Prices of duplex housing units declined by 33.5 percent.

Only townhouses registered a price increase on a quarterly basis, with an uptick of 4.5 percent. In the fourth quarter 2023, prices of duplex housing units declined the fastest by 42 percent, while condominium units and single-detached/attached houses also have decreased prices by 8.6 percent and 3.3 percent, respectively.

The BSP noted that nationwide loan availments for new housing units continued to grow.

The number of residential real estate loans (RRELs) in the last quarter of 2023 for all types of new housing units grew by 30.5 percent year-on-year. RRELs in the NCR rose 38.5 percent while areas outside of the NCR also registered a higher RREL of 26.6 percent.

On a quarter-on-quarter basis, nationwide housing loan availments grew by 26.9 percent following the 20.3 percent increase in the NCR and 30.7 percent in areas outside of the NCR.

The total number of RRELs went up by 25.2 percent, of which NCR registered a growth of 25.8 percent and 25 percent in areas outside of the NCR.

Meanwhile, the BSP said that in the last quarter of 2023, the appraised value of new housing units in the country averaged to P89,042 per square meter (sqm). This was 19.1 percent higher compared to 2022 level.

The average appraised value per sqm in the NCR increased by 5.5 percent year-on-year but declined by 14.3 percent quarter-on-quarter to P134,178 per sqm.

In areas outside of the NCR, the average appraised value per sqm also rose by 31.8 percent year-on-year and 18.1 percent quarter-on-quarter to P65,186.

In computing the RREPI, the weight of each type of housing unit is assessed by dividing the total floor area of a specific type of housing unit over the total floor area of all housing types.

Using this calculation, the single-detached/attached houses continued to have the largest weight in the RREPI at 53.4 percent while condominium units accounted for 27.3 percent; townhouses, 18.9 percent; and duplex housing units, 0.4 percent.

In terms of profile, the central bank said 84.5 percent of RREL transactions were used to purchase new housing units. About 42.6 percent of loans were used for the acquisition of single-detached/attached houses and condominium units while 14.7 percent were for townhouses.

According to the BSP, “most of the RRELs granted in the NCR were for the purchase of condominium units, while RRELs granted in (areas outside of the) NCR were for the purchase of single-detached/attached houses.”

By region, it added that 30.7 percent of RRELs were for NCR borrowers while the rest with CALABARZON as taking the most number of borrowers were from the other regions.

Specifically, CALABARZON had 33.1 percent of regional RREL share, followed by Central Luzon with 12 percent; Western Visayas with 5.8 percent; Central Visayas with 5.3 percent; Davao Region with 5.2 percent; and Northern Mindanao Region with 1.9 percent. “The said regions, including the NCR, comprised 94 percent of the total housing loans granted by banks,” noted the BSP. — Lee C. Chipongian