By Lawrence Agcaoili (The Philippine
Star) | Updated October 15, 2016 - 12:00am
BSP Deputy Governor Diwa Guinigundo
earlier said authorities have been closely monitoring the real estate sector
through the prices as well as the exposure of banks. STAR/File photo
MANILA, Philippines - Housing prices
nationwide rose faster in the second quarter due to strong demand especially in
areas outside the National Capital Region (NCR), the Bangko Sentral ng
Pilipinas (BSP) reported yesterday.
The Residential Real Estate Price Index
(RREPI) climbed 11.3 percent to 122.8 in the second quarter from the 110.3
recorded in the same quarter last year.
This was faster than the revised 9.4
percent increase booked in the first quarter when the RREPI stood at 115.9
against the 111 registered in the first quarter last year.
The data showed single-detached housing
units booked the highest growth in prices at 18.6 percent followed by
townhouses with 14.7 percent and duplex units with 0.6 percent. The prices of
condominium units were almost unchanged.
BSP Deputy Governor Diwa Guinigundo
earlier said authorities have been closely monitoring the real estate sector
through the prices as well as the exposure of banks.
“We are aware of the potential risk that
may result from all our exposure to the real estate sector. The real estate
sector is viewed as an important concern in the BSP’s conduct of monetary
policy and financial supervision because of the volatility in asset prices
which could be brought about by undue speculation of bubbles,” he said.
Guinigundo explained the RREPI that is
based on actual banks’ approved housing loans serves as a valuable tool in
assessing the change in prices in real estate and credit market conditions in
the country.
About 72 percent of the total real
estate loans extended by banks were used to finance the purchase of new housing
units. About half of the loans were used to buy single detached housing units
followed by condominium units with 41.2 percent and townhouses with 8.4
percent.
The RREPI in the National Capital Region
(NCR) slipped 2.7 percent to 117.8 in the second quarter from the revised 114.7
in the same quarter last year. This was way below the 10 percent growth in the
first quarter when the index reached 116.5 from 115.6.
On the other hand, the RREPI in areas
outside NCR jumped to 18.4 percent to 125.7 from the revised 106.2. This was
faster than the revised nine percent growth in the first quarter when the index
in the provinces climbed to 115.5 from 107.
Guinigundo said the BSP continues to
expand the monitoring of the real estate exposure of banks by including past or
debt securities of holding companies as well as loans extended for socialized
and low cost housing.
“We now have a more comprehensive
computation of exposure to the real estate sector. So we would know in advance
if there is indeed there is some emerging asset bubble in the real estate
industry,” he said.
Latest data from the central bank showed
the real estate exposure of banks and trust entities stood at 20.76 percent in
the second quarter from 20.79 percent in the first quarter.
Loans extended amounted to P1.39
trillion while investments in the real estate sector reached P233.33 billion in
end-June this year.
A stress test exercise undertaken by
universal and commercial banks on real estate exposure and other real estate
property in September last year showed the industry could absorb shocks.
“We believe that this growth is based on
a constructive demand-supply dynamics that have solid structural underpins.
Moreover, our latest assessment in the banking system show that they are
resilient and they can stand potential shocks on the housing sector,”
Guinigundo said.
BSP Governor Amando Tetangco Jr.
reiterated there is no overheating in the country’s property market amid the
strong demand for housing from the young and economically active population.
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