Weak peso a boon to real estate

CEBU, Philippines – The strengthening of the US dollar against the Philippine peso benefits the real estate sector as verified by the growing interest for real estate investments from the dollar-earning market.

"The interest to buy properties now has increased specifically from the OFW market. They want to take advantage of the strong value of their dollar and want to buy right away," said Philippine Allied Chamber of Real Estate brokers and Licensed Salesmen (PhilAcre) president Anthony Gerard Leuterio.

Leuterio said Filipinos working abroad are recently more active in "shopping" for more properties either for their own use, or investment purposes, to make good use of their high-value dollar.

"Even as before when the exchange was not high as today, dollar earners were the most active property buyers, how much more today?," said Leuterio.

Aside from OFWs, Leuterio said that the strong dollar which is also seen to boost the BPO (Business Process Outsourcing), and export sectors, will result to good affordability level of Cebuanos, while large part are employed by these industries.

While the market is active, Cebu property inventory is facing supply "glitch", as buyers are more interested to buy master-planned housing, rather than the mid-rise or high-rise condominiums.

Cebu's property inventory now is largely dominated by condominium products. However, the market has send signals that house and lot packages or master-planned housing (with amenities) are more attractive to them.

Earlier, economist Benjamin Diokno urged the Central Bank to keep the peso at its weakest level, as defending the peso from further depreciating is unwise.

Diokno, the senior economics professor at the University of the Philippines, said any move to use the US$80 billion-plus dollar reserves to defend the peso will be wrong.

In the last few days, the value of peso versus one US dollar hovered within the P46 to P47 levels. It's the peso's almost third month as 46-level, which is the longest weak period of the local currency in over five years.

According to Diokno, it is better that the peso is weak because more overseas Filipino workers would be glad to have it this way.

Peso depreciation, the veteran economist said, benefits recipients of OFW remittances who are more than half of the population. It favors exporters and import substituting firms--" Let it be."

However, the official admitted that the weak peso will greatly affect the country’s debt payment.