Real estate bottomed out in Q1, says ALI

The domestic real estate market has already bottomed out during the first quarter of the year as home purchases have already pick ed up, the country’s biggest property developer said Tuesday.

Jaime Ysmael, Ayala Land Inc. (ALI) chief finance officer, said buying patterns shifted in the second quarter of the year due to easing market uncertainties.

“There’s a strong end-user demand in middle to lower income segments, while outlook for high-end segment also improving. Reservations and booking are all up since February, with June reservations double that of January” Ysmael told reporters.

The ALI executive said the real estate industry would be better by the second semester due to additional launches.

The company is set to launch Montecito Tranche 2, Ayala Greenfield Estates Phase 6, Anvaya Cove Neighborhood 7, Ametta Place, Avida San Lorenzo, Anvaya Seascape Ridge.

The outlook on shopping centers is also positive as consumption would be buoyed by overseas Filipinos workers’ (OFW) remittances, Ysmael said.

From January to April this year, OFW remittances rose 2.7 percent year on year to $5.5 billion, or 19-percent higher in peso terms.

“Retail rents [are] generally stable or fluctuating along narrow bands. Expansion [is] ongoing among major developers especially outside Metro Manila,” he said.

In the first quarter of the year, ALI’s profit declined 21 percent to P907 million due to the absence of large transactions, similar to last year’s sale of three subsidiaries, namely Piedmont Property Ventures Inc., Stonehaven Land Inc. and Streamwood Property Inc.

The sale of the three units generated P762 million in pre-tax capital gains in 2008.

ALI said sales of its high-end unit, Ayala Land Premier, dropped 24 percent mainly due to lower new bookings for the quarter.– Chino S. Leyco, Manila Times