Individuals looking to purchase or acquire real estate are best advised to seek help in making decisions especially as this could either give them a lifetime of joy or a great deal of remorse.
Then again, who can afford to pay millions in cash? Most people can’t. So they wonder how to borrow such a huge amount of money to finance a home. The good news is, there are many convenient options out there these days. Lending agencies offering home loans or mortgages are around to help and make the journey less strenuous, or just a breeze, if one is lucky.
There are two options for Filipinos for housing loans: public (PAG-IBIG) and private (thru banks). Major banks have housing loan programs that typically involve monthly payments for the loan tenure until it is repaid fully both the principal of the loan and the interest. Interest rates for housing loans differ from bank to bank.
During the early years of the loan, most of the monthly payments are used to repay interest; down the road the larger portion of the payments will go into paying down the principal.
Interest is calculated based on what is owed on the loan each month, so paying a little bit extra each month lowers the payments in the subsequent months.
The economy, as it further opens, is expected to pick up significantly in the second half of the year. In a statement released last year by leading diversified professional services and investment management firm Colliers International Philippines, it was forecast that the demand for the residential property in Metro Manila will recover this year.
“Colliers expects a recovery in residential demand in 2022 on the back of rebound in office leasing, macroeconomic recovery, sustained remittances from Filipinos working abroad, competitive mortgage rates, and pick-up in business and consumer sentiment,” Collier said.
Colliers in its second-quarter report last year said the completion of residential projects in Metro Manila is expected to support the rebound of the market until 2022.
Colliers added that the Bay Area has surpassed Makati central business districts (CBD) with the highest supply of condominium units.
“As of Q2 (second quarter) 2021, Colliers has recorded about 28,718 condominium units in the Bay Area, overtaking Makati CBD’s 28,551 units. At present, the Bay Area has the second largest condominium stock in Metro Manila, next to Fort Bonifacio which has 39,505 units,” it said.
Between 2021 and 2025, Metro Manila is foreseen to deliver 7,500 new residential units per year.
“Colliers has also observed a recovery in take-up of pre-selling condominium units in the fringes of central business districts. The demand in the peripheral areas has outstripped supply since 2018,” it said.
Colliers cited Makati Fringe, Manila-North, and Manila-South as the top fringe areas in terms of take-up from 2018 to first semester of the year.
The government vaccination program continues to provide the pervading rosy outlook, and will further strengthen the rebound when the private sector is allowed to secure vaccines without government participation.
“The inoculation efforts should contribute to a recovery of investor sentiment as the government aims to achieve herd immunity by Q1 (first quarter) 2022, which should inject a much-needed boost to the country’s residential sector,” Colliers added.
Pag-IBIG sets new record
According to the state-owned and controlled corporation responsible for the administration of the national savings program and affordable shelter financing for Filipinos, Pag-IBIG Fund, in January to May period this year, again surpassed its own record by releasing over P40 billion in home loans in the first five months of 2022, releasing home loans worth P40.41 billion, the highest ever amount released during the first five months of any year in its history.
The amount disbursed so far this year, compared to the same period last year, grew 15% from the P35.28 billion released during the same period in 2021.
“Pag-IBIG has once again set a record in the amount of home loan releases to begin the first five months of the year. We are happy that the number of Filipino workers who can become homeowners through the Pag-IBIG home loan programs continue to grow. Our consistent performance also indicates that the home loan policies we have set in place have been effective, and we expect that these would continue to enable even more Filipino workers to have decent and affordable homes in safe, sustainable and resilient communities,” said Secretary Eduardo D. del Rosario, who heads the Department of Human Settlements and Urban Development (DHSUD) and the 11-member Pag-IBIG Fund Board of Trustees.
Pag-IBIG Fund Chief Executive Officer Acmad Rizaldy P. Moti said the amount released as of May financed the acquisition and construction of 36,865 homes for Pag-IBIG Fund members, 5% higher than the 34,979 homes financed during the same period last year.
Moti added that out of the total number of homes financed, 6,787 or 18% were socialized housing units which are now owned by minimum-wage and low-income workers and their families.
“Last year, we surpassed the P100-billion-peso level in home loan releases, a feat we previously thought was impossible. This year, with our record-high home loan releases from January to May, we are optimistic that Pag-IBIG Fund is well on its way to yet another banner year. Should the current trend hold, we expect to release at least P105 billion pesos in home loans by year’s end. I am confident that our outstanding performance on the home loan front will be sustained, especially under the leadership of our Deputy CEO for Home Lending Marilene C. Acosta, who has been instrumental in our record-breaking performance in home loan releases since 2017”, Moti said.
NHMFC receives recognition from OSHDP
National Home Mortgage Finance Corporation President Carlos Luis P. Rabat received the Plaque of Appreciation from the Organization of Socialized and Economic Housing Developers of the Philippines (OSHDP) at the Appreciation Dinner for OSHDP’s partners in keeping the housing industry strong despite the challenges of the past years.
The award is in recognition of NHMFC’s support to OSHDP’s vision of efficient and timely delivery of socialized and economic housing. OSHDP also recognized the corporation’s outstanding dedication, commitment and service to the housing industry and the country despite the challenges confronted by the housing sector.
“The NHMFC, throughout the years, has developed groundbreaking financial instruments to increase the availability of decent and affordable housing loans for all Filipinos. Our flagship programs — the Housing Loan Receivables Purchase Programs, particularly our Purchase of Economic and Low-Cost Housing Receivables or HOME Program, and our Socialized Housing Loan Takeout of Receivables or SHeLTeR Program. — aim to bridge the gap of the country’s economic and socialized housing backlog,” President Rabat said, adding that “considering the challenges, this mission is not easy but partnering with institutions like OSHDP, whose thrust is also on efficient delivery of socialized and economic housing, the burden becomes lighter.”
President Rabat also expressed his delight to be accorded with the recognition together with Department of Human Settlements and Urban Development (DHSUD) Secretary Eduardo del Rosario and Pag-ibig Fund CEO Acmad Rizaldy Moti. He specially thanked DHSUD Secretary Eduardo del Rosario for the department’s undying support and leadership to the NHMFC and the other Key Shelter Agencies, making the housing sector’s vision a success.
The NHMFC President also vowed that the agency will continue with its goal, as a secondary mortgage institution, to develop groundbreaking financial instruments to increase the availability of decent and affordable housing loans to all Filipinos.
