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'OFW phenomenon' to continue in 2006 |
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WILL OVERSEAS Filipino workers' investments in their home country continue to rise
or slacken this year? Optimistic developers and real estate firms believe more money
from OFWs will be pouring in.
Eric Soriano, ERA Philippines country president and CEO, said home mortgage investments
develop "discipline" in the form of forced savings on OFW dependents.
"Our studies have shown that there is a 92 percent repayment of monthly amortizations
among OFW homebuyers, a positive indicator for the industry," Soriano said.
"I believe the iceberg for OFW markets is very deep," he added.
Top priorities
According to him, statistics have shown that education and real estate are still
top priorities for any OFW provider. Reinforcing OFW remittances are new money coming
from balikbayans from North America and Europe.
Marivic Añonuevo, vice president and head of Ayala Land Inc.'s leisure and lifestyle
communities, said the number of Filipinos leaving the Philippines to work abroad
continues to grow at around 12.5 percent.
"Although this is really a sad phenomenon, this indicates however that the amount
of dollars earned and remitted back home continues to grow. Rather than slacking
off, therefore, we in ALI feel that we have only mined what we believe is the tip
of the large OFW market."
Danilo E. Ignacio, general manager of Robinsons Land Corp.-high rise building division,
said RLC is confident that the OFW investments in real estate will remain.
Owning their home
Jose EB Antonio, chairperson of Century Properties Group and Meridien Development
Group, said that 30 percent of the income of OFWs in general is spent on housing,
whether to buy a new home, fix present homes or pay for rent.
"The quest for the Filipino dream of owning their home is foremost in the minds
of OFWs. It is also worthwhile to note that the average income of an OFW has increased,
as more white collar workers and technical people are working abroad," Antonio said.
Soriano observed that historically, spikes in OFW remittances occur every middle
and end of the year.
"However, with the continuous deployment of new OFWs in existing and new geographical
markets and the increase in remittance month on month, we can expect a steady stream
of real estate business from the sector all throughout the year," he said.
Añonuevo estimated that ALI overseas sales accounted for nearly 20 to 25 percent
of the total sales volume generated by the ALI parent company, including subsidiaries
such as Community Innovations Inc and LPHI. She added that recognizing this large
potential, ALI has established Ayala Land International Sales Inc.
Ignacio said that RLC markets selected projects internationally. "Revenues generated
from our international marketing efforts account for a substantial portion of our
sales. We thus intend to pursue building this segment," he said.
Advice to developers
ERA Real Estate, a multinational real estate service provider that manages Eastwood,
expects to grow its OFW portfolio from 15 percent in 2005 to 25 percent this year.
"The industry posted an average OFW contribution of 20 to 25 percent. My advice
to developers is for them to focus on increasing their OFW portfolio by an additional
15 percent this year," Soriano said.
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