Real Estate Sector slowly Recovering

by Ehda M. Dago-oc
May 23, 2003

AFTER experiencing years of drought in the real estate industry, players in Cebu have finally seen slow movement in the sector since last year.

"The market is slowly improving, we have been seeing movement since last year, I hope trend will continue in the future, and eventually bring full recovery in the sector," said Rene Avila president of Chamber of Real Estate and Builders Association (CREBA-Cebu).

Avila said those real estate projects or plans, which have been stopped due to the effect of the regional economic crisis in middle of 1997, are now slowly being realized.

"The investors are now pursuing their long delayed project plans, developers have also noted the aggressive interest of buyers nowadays to buy properties," Avila said on the sidelines during the IFCA consulting (Philippines) Inc. solutions presentation to property and hotel players in Cebu recently.

Majority of the movement is seen in the residential projects because the demand is mostly in this sub-sector of the industry, he said.

Unlike before, that prices of residential units or real estate properties were sold in the market with very enticing discounts, now prices have slowly stabilized, and yet the bulk of buyers are still there.

After 1997, the real estate industry has been experiencing stagnant growth, while developers and real estate players shifted into other sustaining business ventures.

However, starting last year, the industry noted an upward development, which encouraged developers to move on and launched several projects.

AboitizLand for instance, recently installed a division to solely developed housing projects for the middle income earners, while the Ayala Land Inc. Cebu affiliate Cebu Holdings Inc., is seriously considering launching at least two residential projects somewhere in the southern part of Cebu this year.

Avila said after 1997, investors in the real estate industry, (if there were investors) were mostly speculators, but now the players noted that the investors now are the true real estate investors who have serious plans of pursuing projects, while buyers are also the serious buyers, not anymore speculators.

"Since 1997 to 2001 there were very few sales, we practically felt the downtrend," said Avila who is the president of JESA Management Corporation, which is into commercial leasing business in Cebu.