Leechiu Property Consultants (LPC) sees the Bangko Sentral ng Pilipinas (BSP) cutting rates by 25 basis points when it meets on Thursday, which it said bodes well for the property sector.
Tam Angel, LPC director for investment sales, in a briefing Tuesday said the local-centric focus of the real estate industry is insulating it from the global volatility brought by the ongoing US trade war.
While being inwardly focused is “not necessarily a good thing” for the market, Angel said, it still “forms as an advantage primarily because a lot of the demand is local” at present.
“We don’t have very many foreign players in the market. A lot of that has to do with our ownership regulations and land use regulations. It’s also the fact that our market is relatively small for a lot of these foreign funds to come in. So because the demand or the action is primarily local, we’re somewhat insulated from the global incidents,” he said.
“Not all of it, it will (still) impact us. But in the meantime, our market primarily being local becomes an advantage. That’s not to say that we shouldn’t strive to be an international market. We should, but for now, we are somewhat isolated from the global happenings because of that,” he added.
Angel said given the benign inflation in March at 1.8 percent that was reported last week, slower than the 2.1 percent in February and January’s 2.9 percent, the three-month inflation average to around 2.2 percent, “right smack in the middle of the BSP’s target range of 2 percent and 2.4 percent.”
“Because of this and the lesser evil 17 percent US tariff to the Philippines in comparison to our neighbors, we project that the central bank has a bit more sure-footedness in their ability to cut earlier this year,” Angel said.
