Last February 10, 2021, Filipino Homes Founder Mr. Anthony Gerard O. Leuterio was invited by ANC 24/7 for a live video interview with Michelle Ong to talk about the status of real estate in the Philippines, its trends, and changes in the time of a global pandemic.
During the interview, Mr. Anthony Leurerio shared important key points that everyone should know regarding the current state of the real estate industry in the country.
Demand for socialized and mid-market housing
In the current status of the real estate industry, the housing backlog in the Philippines now stands at about 6.75 million units. If left unaddressed, it can possibly balloon to 22 million in the next coming years. With this, Leuterio was asked during the interview how the industry is going today with the growing housing demands.
“The industry is doing very good. In fact, Filipino Homes is operating all over the Philippines and we saw a demand in socialized, economic, and even mid-market housing. Especially today that most of the buyers want to own another home where they want it more COVID or ECQ-friendly. These are homes where they can have a mini office and/or a garden. You know there is a growing demand for backyard gardens.”
Because of this, Leuterio is urging developers to consider these trends in order to cater to the demand, saying that failure to meet its demand would add to the already ballooning housing backlog in the next coming years.
He explained that while demand for office spaces may be weak, demand for socialized, mid-market housing remains strong— with many local buyers, including OFWs in the health care sector, looking for a second home that’s ECQ-friendly.
Inclusivity of the Real Estate Service Act of 2009 (RESA) Law
Leuterio has always been vocal with his want for change in certain provisions in the RESA Law or Real Estate Service Act of 2009. At the heart of his advocacy, he wants the provisions to be more inclusive so that non-real estate management graduates can apply to become licensed brokers.
In the interview, he was asked if he has allies in Congress and if he is confident in the success of his advocacy.
“Yes. We have a group already. We call it A Better Real Estate Philippines (ABREP) where most of the allies now are interested in the amendments. We are actually not against abolishing the BSREM (Bachelor of Science in Real Estate Management). We like BS-REM. In fact, I’ll be going to take BSREM, but we just want it to be more relevant,” Leuterio said.
“As we can see, most of the subjects are not relevant to real estate. And what we want it to be relevant and to be inclusive into the real estate sector. The BSREM is really the biggest factor of today’s time because we need more brokers. Last year, we only had 100 brokers, ” he added.
1:20 rule and the difference between a Broker and Salesperson
Another topic that was discussed during the interview was Section 32 of RESA, specifically the so-called 1:20 ratio, where the law requires that corporations have at least one licensed broker for every 20 accredited salespersons.
According to Leuterio, the problem is that most of the brokers now can have more than 20 salespersons because of the technology.
“We are the only country today which has a limit. In fact, Malaysia copied some of the laws from there [RESA] but now they are already changing it,” he added.
Leuterio is urging developers to consider these trends in order to cater to the demand, saying that failure to meet its demand would add to the already ballooning housing backlog in the next coming years.
Leuterio said that the 1:20 rule needs to be amended given the rapid progress in technology, as it limits the potential of real estate to become the country’s major economic driver.
“In RESA, if you’re a broker, you have to hire 20 salesperson. These are the ones who will be helping you to market properties. Brokers are more on the technical side. They know everything from brokerage, to private selling and they need assistance — which we call it salesperson,” Leuterio said.
A Shift to Digital
With the ongoing global pandemic, the real estate industry was also forced to change its operations to adapt to the new normal.
According to Leuterio, to continue the function of their company, they have to rely on technology and pivot to the online digital platform.
He said that most of the brokers now are doing social media marketing. They do online roadshows. And the developers also have innovative ways to capture the buyers like easing their payment terms.