The real estate is one giant business. It encompasses everything that has something to do with land and infrastructure. It’s size, and global demand is the very reason why many investors are attracted to put their money on the business.
But with the increased number of entities who choose to start their own businesses in this industry comes more challenges that are swaying the stability enjoyed by this sector. Here are the major factors that are affecting and helping shape the future of this industry.
Change in the quality of demand
We’re not new to the high demand for private residences. Families are now looking for the chance to live in their dream house and the real estate business is more than willing to provide land and space. However, the current rise of foreign businesses operating in the country also gave way to the emergence of different real estate demands.
A good example would be those office leasing request and government establishments. There is a visible spike in demand for this type of infrastructures which also forces the real estate owners to reevaluate their priorities.
With loans that are already becoming very accessible, many people resort to borrowing money from banks and even from private entities to fund something. There’s nothing wrong with borrowing money. However, this also becomes a long-term burden for people who pay.
Potential clients who might have been interested to buy a land property would be discouraging to do so unless they have paid the entirety of their debt. Plus, there seemed to be a growing number of people who choose to live together with their families to reduce the expense of buying a home.
Global market change
Just like any trend, the status of real estate changes. This is highly dependent on factors such as local and global demand.
Every time there is a considerable change that affects the business, prices and supply could also change.
Taxes and other payments
Business owners who run any real estate ventures have their own responsibility when it comes to paying something. This can also be affected by the taxes they’re mandated to pay. Same goes for owners who wish to buy a new home.
The expected taxes or mortgage could become a burden especially if one still has debts to pay.
Investors are generally attracted to countries with robust and promising economic growth. However, this is largely affected by the current condition of a place’s economy. A country’s current economic policies could largely dictate the direction from which real estate magnates should go.
Likewise, it could also spell out the amount of investment a venture would likely attract.
Last is the current status of industrialization. If we try to look out the changes in our society compared to twenty or thirty years ago, you’ll see a significant change.
Today, we see more buildings and establishments being constructed for different service purposes. The more industrialized the place is, the higher the possibility of encouraging business owners to set up their own.
After all, more people would mean more opportunities to sell.
Despite the challenges experienced by real estate, it’s undeniable how its still considered as one of the leading industries.
In the Philippines, the demand is pretty much high and the capacity of owners to supply is also competent. So you shouldn’t be surprised to see more incoming construction around the major cities. Considering Philippines’ healthy BPO industry and generally low-cost living, more and more foreigners are expected to divert their attention towards us and build company branches.