Asean integration to bring further growth for property sector

MANILA, Philippines - The Philippine real estate industry is expected to grow further next year as the looming Association of South East Asian Nations (Asean) Economic Integration continue to attract foreign investors and with the region’s increasing role in global economy.

According to Noel Cariño, president of Chamber of Real Estate and Builders Association, the country’s largest organization of key players in the domestic real estate industry, the Asean integration in 2015 will change the economic landscape of the whole region, particularly the real estate market.

The elimination of tariffs on goods and services by a single Asean economy would drive consumer spending higher. “The demand for residential spaces adjacent to malls, retail complexes and other recreational spaces would go up and will likely increase the already healthy real estate market,” Cariño said.

The influx of investment and elimination of trade barriers will allow each country in Asean to enjoy unimpeded and free flow of goods, services, labor and capital. The potential impact of the integration would require more commercial and residential infrastructure for highly urbanized cities within the region including key cities of the Philippines.

“Residential, commercial and retail developers, which will be exposed to international market will expand their operations and acquire properties inside and outside the country. While foreign investors and corporate executives with local operations in the country will look for residential spaces for a place to stay,” Cariño added.

CREBA however, reiterated the country must continue to pursue relevant market reforms in order to remain competitive. Charlie Gorayeb, national chairman of CREBA said, “Foreign ownership restrictions enshrined in the Philippine constitution will hinder the growth of foreign direct investments, so we need to continue to improve the business environment in the country in order to attract more investors.”

CREBA has been pushing for the passage of a bill that will consolidate the function and powers of major housing and urban agencies of the government to address effectively the needs of both consumers and developers.