Developers are experiencing an inventory shortage because of high demand for middle market condominium units in Cebu.
They are running out of units to sell especially those properties in the P60,000 to P75,000 per square meter range, said Anthony Leuterio, president Leuterio Realty and Brokerage, last Saturday.
“The market is desperate to buy a property, and developers are scrambling to develop more projects. They (developers) are now developing more new concepts for the market, but they will need the help of government for infrastructure support,” said Leuterio.
With Cebu being a top tourism destination, many foreign nationals are now looking to buy properties here for retirement.
“What’s happening now is that foreign developers are now coming here and partnering with local developers to develop properties for their own market, like the Japanese and the Koreans, and the best property for them is the condominium because these foreign nationals cannot own a house and lot here,” he said.
Leuterio said that there are many lots in Cebu that can still be developed for condominium projects but need roads and other infrastructures which he said the government should support.
“The demand now is about 150 to 190 buildings for condominium at the P60,000 to P75,000 per square meter range and 150 to 200 subdivision projects. The projects that aren’t selling are those that were priced wrong,” said Leuterio.
Mid-Range
Leuterio described the Cebu market as five percent rich and 95 percent mid-range, which is why developers, like Primary Homes and Cebu Landmasters Inc, offer more midrange products.
“They (Primary Homes and Cebu Landmasters) ran out of inventory, and they are now doing double time to develop more. Primary Homes’ walkup condo project The Courtyards at Banawa which they recently launched is basically sold out. That’s how desperate the market is,” said Leuterio.
Even high-end products, which cater to only five percent of the market, like condominium projects at Megaworld’s The Mactan Newtown Center is also experiencing the same robust takeup of units.
They currently have three projects launched which includes 8 Newtown Boulevard, One Pacific Residences and One Manchester Place which now have a limited number of units available, said Sunshine Roxas, Megaworld’s sales manager.
“To also cater to those who wants an easier means of payment, we offer special packages because we saw the interest and we want them to be able to invest in a quality product like ours,” she said.
Leuterio said that brands like Megaworld and Ayala Land are also successful in penetrating the five percent market because “first they already have the track record, and second, they offer good packages for their market.”
OFWS
He said that the market is dominated by overseas Filipino workers (OFWs) now wanting to invest in real properties, local investors and the “flippers” or those who buy properties and then sell them when the value of the property increases.
“Real estate is a by-product of tourism, and Cebu is a top tourist destination that is why we are getting a lot of interest from buyers around the world. We should take advantage of this trend which is expected to continue until 2016 or up to 2020 if the government is supportive,” Leuterio said.