Redefining the relationship with your home

Published January 29, 2022, 3:23 AM

by Manila Bulletin

HOMEFRONT column by Victor B. Consunji, Founder and CEO of Victor Consunji Development Corporation

The adage “Home is where the Heart is” is something we’ve all heard before. The truth is, the relationship between a homeowner and their personal kingdoms is much more complex than that. A home has always been both an investment and a place to live, but two years ago they suddenly became the only refuge from the outside world and, for many, instantly became the workplace.

The real estate sector as a whole is undergoing major shifts. The residential market is of particular interest to me and my company, so I’d like to focus on the many cross currents, different supply/demand dynamics, and evolving desires from the consumer base that we see coming on the horizon.

Before we look ahead to reopening in the new normal and attempt to forecast the trends to follow, I’d like to reflect on how we arrived here. The pandemic induced work from home regime increased the amount of time spent in one’s residence and eliminated the daily commute (something of a silver lining to many). We started to notice what we liked and disliked about our homes, indoor and outdoor space becoming more coveted.

The pandemic merely accentuated the natural progression of our developing real estate market. As Metro Manila was hitting new highs in price, developers tried to keep the price point the same by reducing cut sizes, and homeowners looked outside the NCR to grab the land they needed to cement the legacies of their growing families.

The BSP recently noted a drop in property prices in the NCR, falling by nearly 10 percent from the first quarter of 2020 to the fourth quarter of 2021. Conversely, property prices in areas outside the NCR rose by 0.8 percent year-over-year. That absolute and relative price performance, especially during a time when unemployment was estimated to be over 8.9 percent, speaks volumes.

Facade of Harper Villa

Going forward, as the necessity of work from home subsides for many industries, we feel the last two years have imparted lasting effects on the economy and homebuyers’ mindset. Many companies that were forced to go digital have realized that for them there’s no going back, especially having seen the efficiencies remote employees can generate, provided they have the proper management systems in place.

With the growing population entering their prime earning years and looking to grow their families, land and space will continue to be more coveted and we feel the upward trajectory of pricing outside of Manila will persist. Previously one would be tempted to move back to the city simply to avoid that dreadful commute, but the de-urbanization plan of the government has already created new arteries into Metro Manila, making places like Laguna seem like a stone’s throw away.

The emotional component of home purchase has become more dominant in the overall decision and one of benefits of additional space is the customization factor, which condominiums do not offer. The ability to create a personal space of your own, ensuring the proper Feng Shui and energy, consistently ranks high on the list of priorities for our homebuyers.

Today’s homebuyers also want to contribute to the sustainability movement and since electricity costs increase in lockstep with home sizes, we can easily see how design features like solar, home automation and energy efficiency will continue to gain traction.

Condominium buyers are accustomed to the simplicity in the process of purchasing their condos. The prospect of purchasing land and building a house, for those not in the construction field, seems daunting. Everybody has heard or experienced the struggles of getting a reliable contractor, as even minor repair work can turn out to be a major hassle. Developers who focus on providing their clients an opportunity to control the home customization process will be primed for success.

These homeowners aren’t just buying locations anymore, they are considering how their home contributes to their families long term well-being and day-to-day quality of life. The redefinition of the relationship with the home is underway, families want spaces that will adapt to their needs, and are taking pride in creating a life that is uniquely their own. Investors who understand that this shift in market sentiment is here to stay for the foreseeable future will continue to be rewarded for years to come.