Dampened appetite for condos in Davao City seen as short-term
BusinessWorld Maya M. Padillo February 11, 2020
DAVAO CITY — Major damage in some condominium buildings in Davao City caused by the series of earthquakes in October and December last year has dampened demand, but horizontal housing projects are benefiting as buyers and renters look to apartments and single-detached houses, according to a real estate consultancy firm.
Maria Luisa Abaya, regional head for Visayas and Mindanao of Prime Philippines, said discussion with brokers indicate a significant slide in both inquiries and purchases of units in vertical developments.
“With what happened recently, the situation of a developer was not able to immediately respond, there are a lot of condominium buyers who had that apprehension na ganito ba ang mangyayari (of, is this what will happen)?” she said during a recent forum.
Ms. Abaya added that while the developer is already handling the situation, the market remains on a “wait-and-see attitude.”
Damosa Land, Inc. (DLI) Vice President Ricardo F. Lagdameo, whose company’s condominium project was unaffected by the tremors, sees the drop in demand likely lasting for a year.
“The residential space, which is becoming somewhat crowded, will still show signs of opportunity. However, I would think there might be a bias for horizontal projects at least for this year,” Mr. Lagdameo told BusinessWorld when sought for comment.
“Overall, I think indications are still positive for Davao Region’s real estate sector,” he added.
Ms. Abaya said the market’s interest and confidence will also eventually be bouyed by the city government’s response to the situation.
The Davao City government, through its engineering office and private engineering groups, has been assessing structures and issuing appropriate orders to condemn or vacate the buildings.
It has also been taking initiatives for stricter compliance to national and local building rules.
“The city engineers are already making sure that when they are issuing building permits, everything is covered,” she said.
“What we experienced in the last quarter with regards to earthquakes happen worldwide and it is just like one of those challenges that we go through,” Ms. Abaya said.
Davao City Chamber of Commerce and Industry, Inc. President John Carlo B. Tria told BusinessWorld the overall real estate sector, including residential, commercial and office space developments, continues to be upbeat.
“I think demand for property remains strong across the board and different segments. Trends change from time to time,” he said.