Are land, house and rents prices falling ?

Lat61 wrote:

Due to COVID-19 pandemic, do any of you see prices falling due to lack of income and a falling off of remittance payments.

I haven't seen any reduction in the cost of land or homes, though I have seen an increase in building estimate prices due to an increase in the cost of materials. 

I have see a reduction in the advertised rent prices on condominiums in our are around Silang and Tagayatay.

I have seen some properties listed where the expat owners have decided to sell out and move back, but, at least here in Ormoc, asking prices have not gone flat.

Investments are down. the country is borrowing (selling Bonds) the country will hurt financially.   Some of the middle class will have to do fire sales and the lower middle class will sell  (all generalization's of course).

The government is struggling with its budget now.  Do the Banks have enough cash reserve to see them  (and there borrowers) through this.  The government has already allowed the banks to reduce their reserves. 

PS don't forget the government is already talking about raising taxes, (they didn't say if that would be income or business or other taxes revenues), to re-funding it self.

Every country is hurting, it is not just the Philippines.

I have seen and heard of  more privately owned investments being sold, such as small scale farm lots and (not that a car is a investment) but there are some fire sales out there for second hand cars that people can no longer afford.

My view is that low end properties will drop in price first. Then the middle $$ properties will take a bit longer but they will come down.

For people cashed up to buy things are looking good.

pej1111 wrote:

Investments are down. the country is borrowing (selling Bonds) the country will hurt financially.   Some of the middle class will have to do fire sales and the lower middle class will sell  (all generalization's of course).

The government is struggling with its budget now.  Do the Banks have enough cash reserve to see them  (and there borrowers) through this.  The government has already allowed the banks to reduce their reserves. 

PS don't forget the government is already talking about raising taxes, (they didn't say if that would be income or business or other taxes revenues), to re-funding it self.

Every country is hurting, it is not just the Philippines.

I have seen and heard of  more privately owned investments being sold, such as small scale farm lots and (not that a car is a investment) but there are some fire sales out there for second hand cars that people can no longer afford.

My view is that low end properties will drop in price first. Then the middle $$ properties will take a bit longer but they will come down.

For people cashed up to buy things are looking good.

Agreed...It may get much worse in the next 1 to 6 months.
Then there will be a new round of investment/currency risk, higher taxes  & the like to deal with.
Invest here with a mindset that whatever you buy to own (Land/Car) is BUT a form of long term RENTAL with cash up front.
(Unless PRO foreign ownership rules on Land/Business set in!...which may happen in the months to come!)
These are indeed troubled times for not only the Philippines and I rekon the full financial impact has yet to be felt!
OMO!

My overpriced, 2 BR, up Philippine apartment, with no kitchen lease just came up for renewal in Angeles City. The landlord still wants the inflated rent for a 1 year lease and 12, postdated checks for the year. 4 of her 7 units are vacant and she doesn't care.   I agreed to a 3 month extension and want to move. I have found that common sense and real estate do not mix in the Philippines.

4 of her 7 units are vacant and she doesn't care.....= neither should you!
Best to source for another place in those 3months.
(Omo)

https://finance.yahoo.com/news/global-r … 00497.html

Glen Adkins. she will care when the payments are arrears. Pretty soon she will giving the Filipino look of suspense then smile afterwards to hide it. Lets see how long it takes the banks to care. As they say money talks and bs walks.

Hello Glen agreed with real estate and common sense but I am afraid that is everywhere not just the Philippines.  It's human nature and therefore does not require common sense.  When people like that feel the economic heat, the prices will fall and fall fast.

Glen Adkins wrote:

My overpriced, 2 BR, up Philippine apartment, with no kitchen lease just came up for renewal in Angeles City. The landlord still wants the inflated rent for a 1 year lease and 12, postdated checks for the year. 4 of her 7 units are vacant and she doesn't care.   I agreed to a 3 month extension and want to move. I have found that common sense and real estate do not mix in the Philippines.

They have a strange thing here, if it vacant , or not of a lot of people looking for a unit they put the price up, not down.  It happened to me, 3 of 6 apartments were vacant and the owner put our price up.  I have spoken to some Filipino friends and they say yep that is what happens

After being here a year and dealing with a very nice lady that represents the owner, who is in Manila, I get the feeling the building is paid for in full and she doesn't care if she rents it or not.  Either way, the agent wanted another year, with post dated checks up front.  I said no; we have to move.  She then asked for 6 months.  I said no; we have to move into a bigger place for the same or less money.  I offered her 3 month extensions at a time, until we find a place.  She graciously accepted.  She can have 3 monthly checks, in advance, every 3 months.  It all ends well.

Our landlord has had two units vacant for at least a year for the same high price that we are paying. Her 3rd  larger apartment is now vacant and she is asking the same price you would be for a
house, in this area.

Better rent out lower. You got peso. Empty no income.

I have observed that common sense seldom prevails with PI real estate.

A helpful quote :
"Don't find fault, find a remedy; anybody can complain"
Henry Ford

More than 10 years i'm staying here in Philippine , i noticed landlord with apartment , they just want the money every month and they don't really care about the quality of their own building  , basically they don't do maintenance , no pain job etc.. its a strange mindset

Henry Ford didn't live in the Philippines.

Firezilla wrote:

More than 10 years i'm staying here in Philippine , i noticed landlord with apartment , they just want the money every month and they don't really care about the quality of their own building  , basically they don't do maintenance , no pain job etc.. its a strange mindset

It is the case everywhere not only in the Philippines !

pej1111 wrote:

Glen Adkins wrote:

My overpriced, 2 BR, up Philippine apartment, with no kitchen lease just came up for renewal in Angeles City. The landlord still wants the inflated rent for a 1 year lease and 12, postdated checks for the year. 4 of her 7 units are vacant and she doesn't care.   I agreed to a 3 month extension and want to move. I have found that common sense and real estate do not mix in the Philippines.

They have a strange thing here, if it vacant , or not of a lot of people looking for a unit they put the price up, not down.  It happened to me, 3 of 6 apartments were vacant and the owner put our price up.  I have spoken to some Filipino friends and they say yep that is what happens

Yes, it defies logic. Units will stay empty for months on end but they will not lower the price..

yes ! if you have to rent the price is lower and need to try to down the price !
about buying its better to wait more as the real estate here falling , itsreal estate bubble
price are down then many offer now deal house + car more cheap then the house alone before the corona.
many cant pay there bank loan, just wait more 3 months

you right , if you planning to buy house better to wait more as the country is in real estate bubble,
soon they cant pay the loan ,,,already now i see price drop in davao city , as owner down there price plus add a car to the deal!!!

Yes I'm not in the Philippines but my experience with real estate is the first phase is of denial, second phase landlords in disbelief but maintain same pricing, next is when it starts becoming difficult to make bank payments turns to despiration, still haven't lowered price but ready to bargain, next is acceptance/depression as the bank has taken back the property, by the way the price is still the same.  People no matter what nationality are delusional/emotional when it comes to real estate.  For some reason they can't think logically. Sometimes people think there's gold in the walls as that's the only possible explaination why a property would be so expensive(this would be the problem most builders have as well).  Builders tend to have a price that's at least ten percent higher than the actual market value.  That's why it never makes sense to purchase new property from a builder.  The first five years are spent making up for the builder premium.  Also if you have no buyers meaning no market, then how are you going to sell said property?   Speaking as a previous real estate appraiser for 15 years.  As an investor, even I was burned in 2008.  Lesson learned buy low sell high.  The key is knowing what is low and what is high.

even the owner have gold in the wall as you say, when you cant pay the loan , you must sell cheap , no other way

Money is king now.

This is wise. Keep cash

My wife and I own an apartment complex in Dinalupihan, we live in San Diego, CA, we rent our 2 bedroom apartments for P3500, with all updated fixtures, we decided to keep rents the same for another year even with mortgage payments due to COVID-19, my in-laws have said other apartments are being raised, which is unfortunate

People who don't see or who do not understand what's REALLY going-on in the world right now will suffer greatly.
Soon, very soon (in one year), Covid-19 is going to look like a leisurely walk in the park. You are smart if you consider Covid-19 as a WARNING rather than a pandemic!!! 
The real estate sector is about to experience its own apocalyptic WAKE UP call starting late next year. Right now, the prices are still unrealistically high if compared to the underlying economy which is crumbling... not by the day, but by the hour.
Think minimum 50% price reduction but it could go as low as 90% in a few years from now.
Yes, this will be a long term crisis... several years.

I am not doing anything.  Just keep money.  Cash is king.

Yan,
Self sufficiency is the KING these days. Cash is OK if you believe that this crisis is just temporary... I don't.
In my opinion, food shortages are coming.
Unfortunately for me, I am dependent on the system to function smoothly.
In US, millions of newly unemployed people are getting paid to sit at home and do nothing; how long will it take before this translates into serious lack of produced goods/foods.
As of late May, on Palawan, we started to see thinly spread supermarket shelves  and a few non essential items went missing all together. Nothing dramatic, but if this crisis continues for another several months we could be in serious trouble.

I once checked on local banks' website for foreclosed properties. There is quite a bit there. Maybe, in public, one might not see the falling prices on properties but bank records may show differently.

Jackson4 wrote:

I once checked on local banks' website for foreclosed properties. There is quite a bit there. Maybe, in public, one might not see the falling prices on properties but bank records may show differently.

Agreed... a good place to source for foreclosed properties & repossessed vehicles.
(Free legal fees too when using their in-house lawyers)

Btw..I'd stay with some "Gold as it Is Becoming Everything to Everybody'
nowdays.

Yes. Gold is very good.  If u have a gold account.

I must admit i can only "admire" the positivity of the BSP, that there is no bubble in the housing values.  Nor the PSEi (Stock market).  Given that the stock market has taken a yearly drop of -23%, making it the 3rd worst performing markets out of all the Asian countries.

"There are no fears of a property bubble forming in the Philippines, according to the Bangko Sentral ng Pilipinas (BSP). During a recent media briefing, BSP Governor Benjamin Diokno explained property prices are still in line with market fundamentals which usually indicates a bubble scenario is not happening.

While there is persistent demand for residential properties, it would not indicate an asset bubble,” The Manila Times reported Diokno as saying. He also noted that the equity market was not a bubble risk either.

You know when they start talking it up, there are problems.


https://www.dotproperty.com.ph/blog/bsp … wZTd1jg%3D

Markets do not often repeat themselves exactly, but they do often rhyme.  As more and more investors develop the sense of “this can’t happen again because XYZ is different this time”, the more likely it will happen again.  Assets are driven by supply and demand and the emotions of investors.  Through all the advancements in technology and all the regulations, the one factor that has not changed, and never will change, is human emotion.  Emotional markets are counterintuitive.  Investors typically disregard history and are usually doomed to repeat it especially these coming months when corporate bankruptcies starts being reported.!

What is the current rent (ballpark) for two bdrm apartment in the Ilocos Region (near or in city vicinity)?

geolefrench wrote:

Firezilla wrote:

More than 10 years i'm staying here in Philippine , i noticed landlord with apartment , they just want the money every month and they don't really care about the quality of their own building  , basically they don't do maintenance , no pain job etc.. its a strange mindset

It is the case everywhere not only in the Philippines !

I agree. Reminds me of our first rental in San Francisco, CA just after my husband and I got married.

There was centralized heating for the entire building. But the landlord set the thermostat at 60 degrees Fahrenheit or lower. And often he wasn't around to adjust the thermostat. Actually, he avoided going to our building so as to avoid encountering building inspectors. He would be there briefly when it was time to collect rent.

Boiler room / heating needed updating and was not up to code. Carpet at hallways needed changing as they reek of dog urine / odor. He tried shampooing the carpet, but the smell was still there. Some tenants had large dogs in their small units. You can hear tenants arguing about their dogs (noise, smell, waste, etc.).

We had a washer / dryer in our unit, something the landlord boasted about our unit, as other units didn't have washer / dryer. But after some time, we stopped using it as mold started building up around the washer / dryer area. Maybe it's because it wasn't properly vented, or that unit was not meant to have a the washer / dryer.

The landlord charged us US$1,800 because it the rental was at "Pacific Heights." (Technically, it's Pacific Heights, but it's at the cusp of Pacific Heights and Western Addition or really really lower Pacific Heights. It is definitely not the district one would associate with mansions and fancy houses / apartments.)  That was around 17 years ago.

We got out of there after our lease contract expired and we got our deposit back. Good bye Jack or John . . . ummm.  Heck, I don't even know which of his two surnames is the real one. LOL.

Why did you put up with it?

Jackson4 wrote:

Why did you put up with it?

The landlord had our 2-month deposit.

In hindsight, what my husband and I should have done was stop paying rent, and leave the apartment after 2 months of not paying. Our landlord probably won't serve us an eviction notice, as it might prompt city officials to meet with him and visit the building.

We were a young couple. That was our first apartment. We didn't know better.

For our second apartment, the landlord jacked up the rent by 50% after 2 years. We assumed that all rentals in San Francisco are rent-controlled. We were wrong.

When we moved to our third apartment, one of the first things we asked, "Is this rent-controlled?" Yes it was. The asking rent now for a similar unit is at least $4,500. If we stayed in our apartment in SF, we would probably be paying now around $2,400 / month, if you factor in the allowable yearly increase for rent-controlled apartments.

Maybe there will be some movement soon in the rental of condo in Manila... a friend of mine is an owner of a condo in an area of POGOS. Up to now the Chinese company was renting 45k his condo and pay for 1 year without complaining. Now some POGOS are thinking of leaving the Philippines and going somewhere else or even closing and so the prices of rental are starting to fall... My friend told me, the Chinese do not want to pay more than 30k a month... so lets see what will happen with the bubble soon !