Home Seekers Buying Affordable Housing

The exclusive search data of Lamudi was able to yield impressive results into the affordable housing market. It was not only able to identify which demographic inquired about it the most but also popular price brackets. This was further supported by information on the areas where these properties are being searched for. The data also included the top locations prospective buyers came from and times the inquiries were made. This information could be used by the real estate industry to refocus their efforts to directly cater to this demand.

The developing situation

Finding a moderately priced home is indeed an attractive prospect for any home buyer. The question is if there is enough property to satisfy the demands of the affordable housing market? Currently, the answer is no.

This was made clear at The Outlook 2017 by Lamudi Philippines. In attendance were some of the leading players in the local real estate industry. Among them was Atty. Christopher Ryan Tan, a former president of the Organization of Socialized Housing Developers of the Philippines. He is presently the CEO of Hausland Development Corporation and made an observation on the country’s housing predicament. Tan estimates that “It’s somewhere between 168,000 and 190,000 housing backlog a year.”

This number, however, continues to increase annually, along with the entrance of new prospective buyers. He further states, “So when you do the math, considering that population grows, it seems that you would not be able to catch up. So that’s really a huge problem.”

It is a challenge that the Philippine government is taking on along with private developers and a concern many academic institutions is looking into. The Center for Research and Communication of the University of Asia and the Pacific (CRC-UAP) previously compiled an industry report, in participation with the Subdivision and Housing Developers Association (SHDA). Their study entitled, “Impact of Housing Activities on the Philippine Economy”  was the result of their combined efforts. It produced information that put the housing backlog in 2015 at 6.7 million. This further yielded housing requirements of 5.6 million between 2016 to 2030. The housing backlog could potentially total to 12.3 million by 2030.

Popular price point

The Housing and Urban Development Coordinating Council (HUDCC) identified three segments in the affordable housing sector. These were homes categorized into the following price brackets:

  • Socialized housing: Php 450,000 or less

  • Economic housing: Php 450,000 to 1.7 million

  • Low-cost housing: Php 1.7 million to 3 million

Lamudi’s exclusive search data from the first quarter of 2018 revealed which garnered the highest percentage of online inquiries. It was the low-cost housing price bracket at 50%. This was closely followed by the economic housing bracket at 44%. Socialized housing rounded the affordable housing sector inquiries out at 6%. This information, however, must take into consideration other factors.

One of them is the concept of availability. The searches ran parallel to the higher number of units available. These were in the Php 1.7 to 3 million as well as Php 3 to 4 million price ranges. The latter is identified as the medium-cost market having an oversupply of about half a million units in 2015. This was supported by the report provided by the CRC-UAP and SHDA.

Interest by demographic

Men had significantly less interest than women when it came to seeking for affordable properties. The number was almost half compared to their female counterparts. Lamudi’s exclusive search data revealed that 36 percent of searches were made by men in the first quarter of 2018. On the opposite end was 64 percent coming from the female population. These were property seekers looking for homes below the Php 3 million price range.

The data were complemented by different age groups. There were six namely:

  • 18 to 24 years old

  • 25 to 34 years old

  • 35 to 44 years old

  • 45 to 54 years old

  • 55 to 64 years old

  • 65 years old and above

It was the 25 to 34 years old age segment that garnered the highest number of search results for affordable housing. This comprised 40 percent of the total. Females represented the bulk of this number at 27 percent. It was completed with 13 percent of prospective male homebuyers.

Mortgage Property Residential Appraisal Concept

Cities and municipalities targeted

There were varying areas coming out on top of the three affordable housing price brackets. Quezon City (23.39%) was the first choice for the low-cost housing (Php 1.7 to 3 million) group. Economic housing (Php 450,000 to 1.7 million) had the most interest in Davao City (20.92%). While the socialized housing (Php 450,000 or less) group held Rodriguez (23.78%) in Rizal province as their top choice.

Below are the top five locations for each category:

Socialized Housing

(Php 450,000 or less)

Economic Housing

(Php 450,000 to 1.7 million)

Low-cost Housing

(Php 1.7 to 3 million)

Rodriguez

23.78%

Davao City

20.92%

Quezon City

23.39%

Cagayan de Oro

17.70%

Imus

14.05%

Las Piñas

18.07%

San Jose del Monte

7.82%

Marilao

13.55%

Antipolo

13.25%

Dasmariñas

7.57%

General Trias

10.83%

Davao City

9.33%

San Mateo

7.30%

Caloocan

10.22%

Bacoor

7.30%

Quezon City and Caloocan were the only Metro Manila locations that made it to the top five of any category. Cavite, however, was well-represented with four areas searched. This was followed by Rizal province with three and Bulacan with two. All of these are situated either in the outer portions or within the immediate vicinity of Metro Manila. This is with the exception of Davao City and Cagayan de Oro.

Potential clients and peak times

Quezon City-based house seekers topped online searches for affordable housing across the three price brackets. It followed a similar trend of 42.98% for socialized housing, 38.57% for economic housing and 40.03% for low-cost housing. Makati City likewise appeared on the same spot in three categories at second place. The figures were 17.70% for socialized housing, 20.58% for economic housing and 21.25% for low-cost housing. Combined, these two cities already represent the majority of online searches for affordable housing in the Philippines.

Here are the top five locations where most online searches come from:

Socialized Housing

(Php 450,000 or less)

Economic Housing

(Php 450,000 to 1.7 million)

Low-cost Housing

(Php 1.7 to 3 million)

Quezon City

42.98%

Quezon City

38.57%

Quezon City

40.03%

Makati City

17.70%

Makati City

20.58%

Makati City

21.25%

Davao City

7.82%

Manila

10.09%

Manila

10.19%

Manila

7.57%

Bacoor

7.66%

Pasig City

5.44%

Bacoor

7.30%

Cebu City

5.14%

Bacoor

5.23%

Most of the affordable seekers came from densely populated metropolitan areas around the Philippines. Bacoor is the only exception however it is considered as a gateway to Metro Manila and located at its immediate southern portion.

There were three days out of the week which produced significant numbers by online affordable home seekers. These were Tuesday (15.07%), Thursday (14.94%) and Friday (14.40%). The peak times when these were being conducted were 9:00 PM to 11:00 PM (12%) and 1:00 PM to 3:00 PM (11.5%).

Higher demand for lower-priced homes

Price is the prime consideration for Filipino home buyers. It takes precedence over a favorable location and even living space. The availability of affordable housing, however, is constantly low in supply. This segment comprises part of the nationwide housing backlog that grows on a yearly basis. Both the public and private sectors recognize this dilemma and have been hard at work to address the situation.

Recognized luxury developers are joining into the fray. Companies such as Century Properties in partnership with Mitsubishi Corporation as well as Rockwell Land have made public their plans to enter the affordable housing market. Primary Homes while not a luxury developer has found success in this segment. Its Brentwood low to medium-cost housing concept is an award-winning project cited in 2017 as the best condominium development in Cebu. The company is proof that there is a healthy demand for these types of housing.

Kathy Kenny

EIC

Digital marketer. Events host. Content writer. Pursuer of dreams. Music, movie, and book lover. Collector of snowglobes, ref magnets, pens, mugs, Care Bears, notebooks, and makeup. Wanderlust. Sapiosexual. Yawyan Advocate.