[ Manila Bulletin Online ] October 30, 2008
CEBU CITY – Leaders of Cebu’s construction industry are anticipating the ill effects of the financial crisis to hurt the sector, prompting to forecast a slowdown in new property developments next year.
Even as prices of construction materials, like steel, have now dropped by 30 to 40 percent in the last two months, industry leaders expect the pace of major realty projects to "slow down a little," said Carlos Co, chairman and president of the Cebu Overseas Hardware Group.
The company manages and operates Cebu Home Builders, the largest hardware, construction materials and home-fixture supply chain in Cebu.
"Everybody is just being cautious about the global financial crisis. The property market is perhaps apprehensive about spending too much next year. Developers seem unsure if there is demand," Co said.
He said that property developers — both in the residential and commercial — are likely to finish their ongoing development projects until next year, but the aggressiveness for new projects in 2009 will probably fade away, depending on the gravity of the impact of the financial crunch.
On the part of Cebu Home Builders, Co said, the business has "reduced its inventory level" in 2009 to cushion itself from the projected slowdown in market demand despite the continued reduction in prices of steel.
Last August, the price of steel bars was at R65 kilo, and this has gone down to R40 per kilo.
Co said this will benefit buyers but will be hurting industry players.
Earlier, 8990 Housing Development Corp. President JJ Atencio lamented that developers are caught in the middle between price increases of labor and materials in the first half of the year and the unchanged affordability of the buyer.
