The ASEAN integration, happening next year, has stimulated various businesses in the Philippines as expansions and economic growth are being predicted. But how does this integration affect the real estate industry, specifically? The experts have spoken; this industry can expect a great market boost.
The tariff-free effect
Through the integration, tariffs on goods and services will be eliminated. It is safe to assume that this will cause more business transactions, start-ups and expansions, since there will be less costs to cover. This points us to two interconnected assumptions that supports the idea of the growth of the real estate industry: a higher demand for land and more commercial and residential developments.
The prediction is that there will be a higher demand for commercial infrastructures. Realizing this opportunity, developers are now starting to acquire more land to supply for this growth. Moreover, according to the article, the developers are also ready to take advantage of this integration by buying land not only within the country, but also in the international market.
The industry should also look after the residential sector. Knowing that international businesses will expand in the Philippines, foreign investors and executives will search for residential homes in the local setting. Their local business processes presupposes their stay in the country.
Handling the other trade barriers
The ASEAN integration has its inherent benefits, but what can the local agencies do to have the local context ready to initiate and sustain these? This is where the role of the Chamber of Real Estate and Builders Association (CREBA) becomes instrumental. In this situation, they can foster a better business environment by pushing for less restrictions (those in the Philippine Constitution) and for the approval of the bill that will standardize the functions of the housing agencies in hope of bringing more efficiency in the industry.
With all of the opportunities at risk, CREBA will have its 23rd National Convention on October 15-18. In this convention, speakers and attendees will discuss the legislative plan for the real estate industry in the 16th congress, the solution for the 5.5 million housing backlog, among other issues that are relevant. Real estate developers, suppliers and specialists are invited to attend to listen to the speeches of Senator JV Ejercito, the chair for the senate committee on urban development, housing and resettlement, the commissioner of Housing and Land Use Regulatory Board (HLURB), the director of Public Private Partnership Center, the undersecretary of Housing and Urban Coordination Council, and others.
We can imagine the impact of the ASEAN integration to the Philippines through an allegory. We can imagine the integration as a seed that has the potential to bear fruits, and the Philippines as soil. If the soil is not fertile or is not compatible with the seed, we can expect nothing. It will just be a waste of seed; an unexploited opportunity. But, if the soil is healthy and fertile we can anticipate growth and productivity. Generally, the government and private businesses must work together to fully prepare the Philippines for the ASEAN integration to fully enjoy the benefits.