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Residential real estate: A silver lining in COVID-19 cloud

Just as a rainbow brings a ray of hope after the rain, there’s a silver lining at the end of the pandemic.

The best investment on Earth is earth.

This down-to-earth snippet of wisdom comes from renowned real estate investor and philanthropist Louis Glickman, who was born in Brooklyn, New York in 1905.

Steeped in this belief and unwavering in their faith, some of our real estate industry leaders recently tackled the many challenges and changes the sector faces amid the COVID-19 pandemic.

WAIT AND SEE? THIS YOU’VE GOT TO SEE

“Wait and see what was going to happen, a lot of the developers were shying away from doing a lot of marketing because we all felt it was really not the appropriate time to go out there and sell real estate,” Cary Lagdameo of Damosa Land Inc. talks about property investment as a haven during a crisis, at the virtual Lamudi Outlook Roundtable Series.

“But as we moved along, we felt we could slowly start talking and sell our projects online. And we were all pleasantly surprised that there was really an interest, especially in horizontal projects. What we’re seeing, from July to August, is a steady increase in sales. The buyers are a lot more sophisticated now, and they see the importance of real estate as an investment.”

Our real estate leaders agree that, today, if people want to sell not just a piece of land or property but a whole range of products, online is their lifeline. Developers are beyond happy to announce that online sales have actually skyrocketed in the last few months.

“Digital transformation has been forced upon us,” notes Julius Guevara of DM Wenceslao and Associates. “We were doing some of that prior to the crisis, but now, it’s really something we had to do very quickly. We did expand our presence on social media, too, to shift toward a work-from-home kind of environment.”

“We were able to do a lot of virtual stagings for our projects,” Lagdameo points out.

Mico Racelis, business unit general manager of  Robinsons Homes, shares that they have explored other types of content to connect with buyers. “We’ve started doing drone shots for all our provincial developments.”

DREAM HOME COME TRUE

Owning a home today is no longer a dream, property players say. “There’s a strong demand for homes,” says Franco Soberano of Cebu Landmasters.

“One of the triggers for that, for us developers, is making it easier for buyers to learn about our products and making it more accessible to own a home through stretching down payment terms, for instance.”

With stronger demand for homes during the pandemic, developers must not be content with doing things the old way. They must confront the crisis and react to it accordingly.

Indeed, things are looking up for the real estate industry. “Property values held steady, which is pleasant news for us and good for our buyers,” Soberano points out. “Property values will keep on climbing. For example, in Cebu, we have a property that has already reached P300,000 per square meter or speculatively P400,000. I don’t think that’s going to go higher in the next few months or even years. So, there’s also an opportunity to position in properties that will be good bargains from a developer’s standpoint and the end user’s. As for 2021-2022, the vaccine developed soon for COVID-19, or us finding that stability, will definitely spruce up property values.”

Raphael Felix, chairman of the Subdivision and Housing Development Association and president/CEO of PHINMA Properties, is happy to share that even millennials, or the market segment aged 20 to 30 years old, want a piece of the real estate action. “This segment has doubled in the last three months.”

But of course, the young ones, particularly students, are increasingly interested in residential buildings with high-speed internet, according to Tomas Lorenzo, president/CEO of Torre Lorenzo Development Corporation.

Emma Imperial of Imperial Homes Group of Companies reports that her company’s solar power business has experienced electrifying sales, fueled by a strong interest in solar-powered homes.

Joey Bondoc of Colliers International Philippines reveals that location preference has likewise shifted and businesses are expanding to Cebu, Iloilo, and Pampanga, the first to bounce back from the crisis.

THE SILVER LINING

Just as a rainbow brings a ray of hope after the rain or the storm in one’s heart, there’s a silver lining at the end of the pandemic.

Cary Lagdameo urges everyone in the industry to see the silver lining. “The silver lining here is that the pause in prices going up so much. This opens up the market to a wider segment. One of the complaints I used to hear before, especially from certain segments, is they can’t even afford the projects in their own city. A lot of investors are taking up the units and they’re not even from our own city. I think now, with the pause in price increase and certain deals that developers are giving buyers, the market actually becomes wider and inclusive. Later on, when things do get better, prices will start to go up and then those who bought today will have an uptake in value for the property they purchased.”

Another silver lining, says Cebu Landmasters’ Soberano, is that there’s really a big premium for real estate investing. People know that the home is the most secure part of where we need to be in times of crises, so there’s that urgency to own. So, our part as developers is to address that well and not be content with doing things the same way. We have to do things better.”

Architect Henry Yap of Robinsons Land believes that because this crisis will not just end without any intervention, we should confront it and react accordingly. “Learnings from the past can help make informed decisions during crises.”

And so, to borrow the words of author, businessman, motivational speaker T. Harv Eker, “Don’t wait to buy real estate, buy real estate and wait.”

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Article and Photo originally posted by The Philippine Star – Property Report PH last September 25, 2020 and written by Ching Alano.