Home prices rose 5.6% in first quarter

Home prices rose in the first quarter on strong demand as the economy recovered from the impact of the global health crisis, according to the Bangko Sentral ng Pilipinas.

The BSP said the Residential Real Estate Price Index (RREPI) went up by 5.6 percent from a year ago, although it declined by 1 percent from the previous quarter.

"The year-on-year increase in the RREPI is consistent with the outcome of the First Quarter 2022 Consumer Expectations Survey, which showed a higher percentage of consumers preferring to buy real estate property in the first quarter of 2022," the BSP said in a statement.

Residential property prices in the National Capital Region increased by 9.5 percent on year, primarily driven by the increase in the prices of condominium units and townhouses, which more than offset the decrease in the prices of duplex housing units and single-detached/attached houses.

Similarly, property prices in the areas outside NCR or in the provinces rose by 5 percent year on year as all types of housing units registered an upturn, except for single-detached/attached houses, which posted a decline.

On a quarter-on-quarter basis, trends were mixed as residential property prices rose by 3.5 percent in the NCR, but declined by 2.1 percent in the AONCR.

By type of housing units, the prices of townhouses, duplex housing units, and condominium units rose, driving the year-on-year growth in property prices.

In Q1 2022, the 5.6-percent year-on-year growth in the nationwide RREPI was mainly driven by the rise in the prices of townhouses, duplex housing units, and condominium units, increasing by 25.6 percent, 20.9 percent, and 14.7 percent, respectively. Conversely, prices of single-detached/attached houses contracted by 2.5 percent.

Meanwhile, the 1-percent quarter-on-quarter contraction in the RREPI was due to the lower prices of townhouses (-1.7 percent) and single-detached/attached houses (-5.1 percent).

In Q1 2022, the number of residential real estate loans (RRELs) granted for all types of new housing units in the Philippines contracted by 9.2 percent on year due mainly to the 39.3-percent decrease in the number of real estate loans in NCR.

Meanwhile, on a quarter-on-quarter basis, the number of RRELs granted contracted by 30.2 percent as the number RRELs in the NCR and AONCR declined by 42.5 percent and 22.9 percent, respectively.

The average appraised value of new housing units in the country stood at P69,757 per square meter in Q1 2022. The average appraised value per sqm was higher in the NCR (at P120,405) than both the national and AONCR average (at P47,161).

The weight of each type of housing unit in the RREPI is determined by dividing the total floor area (in sqm) of a specific type of housing unit over the total floor area of all housing types.

In Q1 2022, single-detached/attached houses in the RREPI continued to constitute the largest weight at 54.5 percent. Meanwhile, condominium units, townhouses, and duplex housing units accounted for 24.3 percent, 20.4 percent, and 0.8 percent, respectively.

Most of the residential real estate loans granted in the NCR were for the purchase of condominium units, while loans granted in the AONCR were for the purchase of single-detached/attached houses.

By region, 33.2 percent of the total number of RRELs granted were from the NCR, while the rest were distributed in the AONCR as follows: CALABARZON (32.4 percent), Central Luzon (12.6 percent), Central Visayas (5.8 percent), Davao Region (4.7 percent), Western Visayas (4.6 percent), and Northern Mindanao (1.5 percent). NCR and the said six regions combined accounted for 94.8 percent of total housing loans granted by banks.

The RREPI is a measure of the average change in the prices of various types of housing units, i.e., single-detached/attached houses, duplex housing units, townhouses, and condominium units, based on banks’ data on actual mortgage loans granted to acquire new housing units only.

It is a chain-linked index, which is computed using the average appraised value per square meter, weighted by the share of floor area of each type of housing unit to the total floor area of all housing units. The RREPI is used as an indicator for assessing the real estate and credit market conditions in the country. The BSP has been releasing the report since Q1 2016.


Real estate is no longer just Location, Location, Location. 
Now, it’s about Location, Information…and Timing! 

- Alejandro Manalac, Executive Publisher

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