Residential real estate loans contract 10.3% in Q4 2022


Residential Real Estate Loans (RRELs) contracted 10.3 percent in the last quarter of 2022, according to the latest data released by the Bangko Sentral ng Pilipinas (BSP).

Based on the data, RRELs in the National Capital Region (NCR) and Areas Outside NCR (AONCR) contracted by 22 percent and 3.4 percent, respectively.

“Most of the RRELs granted in the NCR were for the purchase of condominium units, while RRELs granted in the AONCR were for the purchase of single-detached/attached houses,” the BSP said.

On a quarter on quarter basis, the nationwide availment of housing loans declined by 4.5 percent.

This was driven by the larger decline in RRELs in NCR at 23.5 percent. This was despite the 8.5 percent growth in RRELs in the AONCR.

In the fourth quarter, BSP said 81.1 percent of RRELs were used to purchase new housing units.

By type of housing unit, most of the residential property loans were used for the acquisition of single-detached/attached houses at 47.2 percent.

This was followed by condominium units, which accounted for 33 percent of the total and townhouses at 18.9 percent.

By region, BSP said 30.5 percent of the total number of RRELs granted was from the NCR, while the balance was from the AONCR.

The data also showed the Calabarzon region accounted for 33.7 percent of the total in AONCR followed by Central Luzon at 12.9 percent and Central Visayas at 6.9 percent.

The BSP said Western Visayas accounted for 5.9 percent of the RRELs in AONCR followed by Davao Region at 3 percent; and Northern Mindanao at 1.5 percent.

“NCR and the said six regions combined accounted for 94.4 percent of total housing loans granted by banks,” BSP said.

The residential real estate prices of various types of new housing units in the Philippines rose faster in the last quarter of 2022 by 7.7 percent year-on-year.

On a quarter on quarter basis, this was slower at 2.2 percent compared with the 4.6 percent posted in the third quarter of 2022.

Residential property prices in NCR grew by 16.1 percent as all types of housing units registered price increases.

In AONCR, residential property prices increased by 4.5 percent, with prices of all types of housing units rising, except for those of townhouses.

“On a quarter on quarter basis, residential property prices expanded by 4.8 percent in the AONCR, but contracted by 2.4 percent in the NCR,” BSP said.

In the last quarter of 2022, prices of duplex housing units jumped 42.9 percent, while condominium units saw a 12.9 percent increase during the period. The price of single-detached/attached houses increased 10 percent.

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 June 2016.