Following the eruption of Taal Volcano, property demand in Southern Luzon will shift anew to Metro Manila as launches would be few and far between.
Joey Bondoc, Colliers Philippine senior research manager, said some owners in areas around Taal are likely to let go of their properties.
Bondoc said some opportunistic buyers are expected to take advantage of the decline in property prices in the near term.
However, once things stabilize, the momentum for prices to rise will gradually arrive.
“Definitely there will be a transition period in terms of recovery of property prices. But the duration of the transition period is likely to depend on the scale of damage and pace of rehabilitation,” said Bondoc.
Bondoc sees national and local governments imposing more restrictions in terms of building and selling mid to high-rise residential units.
This, he said, is likely to result in a slower launch of new condominium units and stricter measures in handing out licenses to sell in the short term.
Bondoc said there will also be see some spillover demand for Metro Manila properties especially for residents and investors looking for options outside the Southern Luzon region.
Bondoc cited the Mt. Pinatubo eruption in 1991 in assessing the impact of the disaster on property.
“It took a major retail development to enter the Pampanga market nearly 10 years after. It took more than 20 years before a large residential developer built a major integrated community. But major developers are already in Tagaytay and surrounding areas, so their expansion now depend on the pace of rehabilitation,” he said.
The Tagaytay market sold 400 residential units in 2019, with a total value of P1.2 billion.
Bondoc said in some years, there were sales of as much as 1,000 units per year and a sales value of P2.7 billion.
From 2016 to 2019 an annual average of 690 units were sold in Tagaytay. Annual condominium sales value during the period was P1.9 billion, Bondoc said.
Bondoc said the eruption is likely to have an effect on hotel occupancy and retail sales in the area. It could also dampen the attractiveness of condotels that use Taal and nearby areas as a major attraction.
In its assessment, Colliers predicts the industrial sector in Calabarzon to remain resilient, given that the Cavite-Laguna-Batangas corridor is one of the country’s primary industrial hub.
“The Calabarzon area is one of the major sources of Filipinos working abroad. We see household consumption sustaining its contribution to the region’s growth. Rehabilitation from the local and national governments could also chip in to higher regional GDP growth.
These efforts should pump-prime the economy, including property. But overall impact is likely to depend on the pace of rehabilitation by both the local and national governments,” he said.
