BACKBENCHER
Rod Kapunan
8/6-7/2011
The house of cards is fast falling apart. The latest card to be detached from the house that was built on a fictionalized mandate was the resignation of Juan Miguel Zubiri as member of the Senate. The day before that was the hearing of another anomalous transaction entered by a regime borne out of political vandalism and of political swindling. This time, involving the sale to the Philippine National Police three of the five Robinson R44 Raven I helicopters. The expose made by Senator Panfilo “Ping” Lacson was confirmed that indeed two of the three choppers were second-hand, but refurbished and sold as new, and far above the original price which it was acquired.
Maybe the issue of overpricing is the standard modus operandi of people in government wanting to take advantage of their position. But in this questionable dealing involving Jose Miguel Arroyo, husband of now Pampanga Rep. Gloria Macapagal Arroyo, it seems that a more sophisticated variation on how to get one over the government they are supposed to serve has taken place. As one would put it, the scheme was splendidly brilliant. Ordinarily, sly operators bent on defrauding the government could not conceive of mapping out such intricate scheme to consummate an obviously questionable transaction.
This, one could surmise that Mike Arroyo, as seller, was aware that the PNP was badly in need of helicopters. He probably thought it wise to buy them from Lion Air, Inc., and later sell them as brand new to a waiting buyer that had not much option but wait for the go-signal and approval from the top echelons who were all appointees of Mrs. Arroyo. It was most clever, for while the Arroyos made use of those choppers for the duration of the 2004 election campaign, they thought of equally avoiding liability from graft and corruption for using them as owners just for Mrs. Arroyo to win that infamous election. After all, they used their own money to buy those choppers.
The problem however is that the modus operandi could not escape the eye of an analytical mind. As one observer noted, since the Arroyos probably knew that the PNP was in need of helicopters to modernize their operations, they were probably made to wait while in the meantime the helicopters were being used to ensure Arroyo’s victory in that rigged presidential election. That is the most plausible explanation, much that none of the top brass in the PNP had the nerve to say “no” to the proposition. For that matter, not one of them even admitted that the helicopters acquired by their organization were second-hand.
Thus, after accomplishing their mission to defraud the people of their votes with the use of those choppers, three out of the five eventually had to be sold to what many believe as a “pre-determined” buyer. That phase then focused on the usual scheme of overpricing the items. This is why the transaction was dubbed by some as doubly anomalous because helicopters, like cars, depreciate fast in price after being sold and used. But in that transaction, instead of the two second-hand helicopters reducing their price tag, they were sold to the PNP for twice the original price of a brand-new chopper. Thus, instead of paying less than P18 million, they were sold to the tune of P30 million apiece.
In that, one could see that the original buyer was not only able to use them extensively for free during their campaign sorties, but was able to dispose of them easily at a price double the original cost for their acquisition. The seller was able to do that because he wields much clout and influence in the government that was hijacked in 2001, and the PNP, as purchaser, could not say anything except to say “yes.”
The sale to the PNP of those choppers could have been most ideal because it likely enjoyed the privilege of tax exemption. Such is logical—why else would Lion Air owner Archibald Po course those helicopters purchased by Mike to another corporation identified as Manila Aerospace Products Trading Corp., owned by Hilario de Vera in order to sell them to the PNP? If seller Mike Arroyo and buyer PNP and the two private corporations, acting as agents, truly believe there was nothing wrong in that transaction, the simplest explanation why they resorted to that system of intricate layering was to prevent the identification of the owner-seller. It was imperative for them to put up a semblance of neatness to avoid being accused of taking advantage of Mr. Arroyo’s power and influence.
More than that, the owner-seller, it seems, wanted to make good the saying that if one wants to defraud the government, he might as well defraud it to the fullest. The best way to do that is to overprice the cost, and get away with it by not paying taxes. This is the only plausible reason why Lion Air, Inc., as importer- seller of those choppers to Mike Arroyo, could not sell them, as agent for Mike, to the PNP.
It instead coursed the transaction to Manila Aerospace Products Trading Corp. to probably misrepresent itself as the importer-seller or as agent of Lion Air, Inc. Nonetheless, many are inclined to believe that Mike Arroyo himself was the importer, but used Lion Air, Inc. to facilitate his scheme. People will least suspect because Lion Air had long been engaged in the business of selling helicopters.
Thus, if the tax-exempt transaction inured to the seller for selling them to a tax-exempt organization like the PNP, then that windfall profit would eventually inure to the real importer himself. This probably explains why Po and de Vera spilled the beans before Senate Blue Ribbon Committee hearing headed by Senator Teofisto Guingona III, for they were possibly used as dummies. Instinctively, no respectable businessman would allow himself to be reduced as collecting agent, while in the meantime he is being deprived of his business by one who only has with him his capital of power and influence.
Indeed, the bungled transaction made a truism of the saying that “there is no such thing as perfect crime.”
(rodkap@yahoo.com.ph)
Sunday, August 7, 2011
Friday, August 5, 2011
A zarzuela of past errors
DIE HARD III
Herman Tiu Laurel
8/5/2011
Finger-pointing is again the order of the day. Not long after Sen. Tito Sotto challenged his colleagues, Kiko Pangilinan and Franklin Drilon, believed to be two of the original collaborators of Gloria Arroyo in the cheating of 2004, to finally come clean by dropping their pretensions, was his subsequent collaboration with the alleged cheating mastermind to partake of the corrupt system also laid bare. Similarly acting blameless while lambasting the cheats today, many of those in media were themselves part of the propaganda blitz that sustained the series of cheating and cover-ups well into 2007 and 2010.
This pattern of holding elections suffused with cheating, then eventually making an exposé out of them, has become a deftly-staged zarzuela of focusing only on the subsidiary corruption in politics to distract the people from a totally debased political-economic order. As a result, the economic and financial corruption, particularly of the parasitic elite, is missed by many.
The past months, we built up a case against the Bangko Sentral ng Pilipinas (BSP) and the Department of Finance (DoF) for their seriously corrupt financial policy of keeping the country in debt despite the financial surplus afforded by our decades-long OFW remittances. Such an anomaly was gleaned from the Special Deposit Account (SDA) amounting to P1.5 to 1.7 trillion and the Gross International Reserves (GIR) which total $70 billion today.
After some controversy with BSP Deputy Gov. Diwa Guinigundo over the issue, an unexpected affirmation of our position came from none other than Finance Secretary Cesar Purisima who publicly favored “the unwinding of the SDA,” which entails the reduction of interest rates to facilitate the fund’s release for domestic investments.
In fact, an Aug. 3, 2011 Manila Bulletin news story by Chino S. Leyco reported that “Purisima, who is also a member of the central bank’s Monetary Board, said… the Aquino government would be happy to accommodate (any unwinding of the SDA). He explained that by unwinding the P1.44-trillion deposits at the BSP’s special deposit accounts, it may cut the borrowing costs of the government.” Furthermore, the report noted, “Deposits by banks to the special deposit account facility of the BSP continued to increase in the past few years, a scenario which critics said… could have been more useful for the economy if it were invested in lending.”
Actually, when we were having consultations with former National Treasurer Norma Lasala way back in 2004-2005, she already insisted that the management of our national reserves had gone awry and, thus, wasted billions. At that time, Purisima was already Finance secretary and Amando Tetangco, the BSP chief. Despite this, the continuity in the financial mafia remains unbroken. Tetangco has gotten his second term for the same post while Purisima got back the Finance portfolio after a hiatus courtesy of “Hyatt 10.”
So the question is, why is Purisima only now beginning to admit the wisdom of “unwinding” the gargantuan SDA (and, in all probability, later proclaim that we can indeed mobilize a greater part of our GIR)?
For sure, achieving this would be a first step toward liberating ourselves from the chains that have shackled us for the past five decades. But that’s just the beginning. The next stage is to free ourselves from ALL debt and all private bankers’ traps.
Since all credit and money is guaranteed by the taxpayer, there is absolutely no reason the people, through the State, should borrow from any private party. The nation should instead set up a “Peoples’ Bank” where creation of credit and money will be subject to referendum.
Now, we ask: Why was there no fanfare when Aquino III reappointed Tetangco to his BSP post when this is one of the most important jobs in the whole government?
Undoubtedly, the answer lies in the fact that the BSP, as it is set up today, is actually “independent,” with the presidential appointment merely ceremonial. And with a Board dominated by private bankers, the bank decides on monetary policy, possessed of an “independent” character institutionalized by Cory Aquino’s handpicked Constitutional Commission — whose members claim is a relic of the 1973 Constitution even without basis.
Being a private bank, the BSP actually follows the workings of the US Federal Reserve and the Bank of International Settlements (BIS) where both have a public façade but with private bankers at the core (see “The Tower of Basel: The World’s Biggest Central Bank Has Private shareholders,” GlobalResearch, July 29, 2011).
Is there any wonder then why the People’s Republic of China is today the leading nation and economy in the world in terms of growth and stability? Its banking system is based on the concept of the “People’s Bank,” with its credit policies designed for national development and public welfare. Of course, this is not the case for the US and its satellites — such as Europe’s PIGS (Portugal, Italy/Ireland, Greece, Spain) — now reeling from the greed and machinations of so-called “banksters.”
But sadly, our Senate, House, and financial bureaucracy — from the Bureau of Internal Revenue to the Bureau of Customs et al. — all follow the diktats of Wall Street, IMF-WB, ADB, and Basel in keeping the Philippines perpetually in debt; in taxing us more to pay it off; and in privatizing public services to create more debt (like the call for P110 billion more borrowings after 10 years of privatizing the state’s power assets).
Our past national errors, such as the 10 years of fraud under Gloria Arroyo, should offer us concrete lessons in our nation’s political-economic history; our decision now should be to turn a completely new leaf — starting with a deeper understanding of our financial system.
(Tune in to Radyo OpinYon, Monday to Friday, 5 to 6 p.m., and Sulo ng Pilipino, Monday, Wednesday, and Friday, 6 to 7 p.m. on 1098AM; Talk News TV with HTL, on “Hello Garci: A Complete History,” with Atty. Alan Paguia, Saturday, 8 to 9 p.m., with replay at 11 p.m., on GNN, Destiny Cable Channel 8; visit http://newkatipunero.blogspot.com and http://hermantiulaurel.blogspot.com for our articles plus TV and radio archives)
Herman Tiu Laurel
8/5/2011
Finger-pointing is again the order of the day. Not long after Sen. Tito Sotto challenged his colleagues, Kiko Pangilinan and Franklin Drilon, believed to be two of the original collaborators of Gloria Arroyo in the cheating of 2004, to finally come clean by dropping their pretensions, was his subsequent collaboration with the alleged cheating mastermind to partake of the corrupt system also laid bare. Similarly acting blameless while lambasting the cheats today, many of those in media were themselves part of the propaganda blitz that sustained the series of cheating and cover-ups well into 2007 and 2010.
This pattern of holding elections suffused with cheating, then eventually making an exposé out of them, has become a deftly-staged zarzuela of focusing only on the subsidiary corruption in politics to distract the people from a totally debased political-economic order. As a result, the economic and financial corruption, particularly of the parasitic elite, is missed by many.
The past months, we built up a case against the Bangko Sentral ng Pilipinas (BSP) and the Department of Finance (DoF) for their seriously corrupt financial policy of keeping the country in debt despite the financial surplus afforded by our decades-long OFW remittances. Such an anomaly was gleaned from the Special Deposit Account (SDA) amounting to P1.5 to 1.7 trillion and the Gross International Reserves (GIR) which total $70 billion today.
After some controversy with BSP Deputy Gov. Diwa Guinigundo over the issue, an unexpected affirmation of our position came from none other than Finance Secretary Cesar Purisima who publicly favored “the unwinding of the SDA,” which entails the reduction of interest rates to facilitate the fund’s release for domestic investments.
In fact, an Aug. 3, 2011 Manila Bulletin news story by Chino S. Leyco reported that “Purisima, who is also a member of the central bank’s Monetary Board, said… the Aquino government would be happy to accommodate (any unwinding of the SDA). He explained that by unwinding the P1.44-trillion deposits at the BSP’s special deposit accounts, it may cut the borrowing costs of the government.” Furthermore, the report noted, “Deposits by banks to the special deposit account facility of the BSP continued to increase in the past few years, a scenario which critics said… could have been more useful for the economy if it were invested in lending.”
Actually, when we were having consultations with former National Treasurer Norma Lasala way back in 2004-2005, she already insisted that the management of our national reserves had gone awry and, thus, wasted billions. At that time, Purisima was already Finance secretary and Amando Tetangco, the BSP chief. Despite this, the continuity in the financial mafia remains unbroken. Tetangco has gotten his second term for the same post while Purisima got back the Finance portfolio after a hiatus courtesy of “Hyatt 10.”
So the question is, why is Purisima only now beginning to admit the wisdom of “unwinding” the gargantuan SDA (and, in all probability, later proclaim that we can indeed mobilize a greater part of our GIR)?
For sure, achieving this would be a first step toward liberating ourselves from the chains that have shackled us for the past five decades. But that’s just the beginning. The next stage is to free ourselves from ALL debt and all private bankers’ traps.
Since all credit and money is guaranteed by the taxpayer, there is absolutely no reason the people, through the State, should borrow from any private party. The nation should instead set up a “Peoples’ Bank” where creation of credit and money will be subject to referendum.
Now, we ask: Why was there no fanfare when Aquino III reappointed Tetangco to his BSP post when this is one of the most important jobs in the whole government?
Undoubtedly, the answer lies in the fact that the BSP, as it is set up today, is actually “independent,” with the presidential appointment merely ceremonial. And with a Board dominated by private bankers, the bank decides on monetary policy, possessed of an “independent” character institutionalized by Cory Aquino’s handpicked Constitutional Commission — whose members claim is a relic of the 1973 Constitution even without basis.
Being a private bank, the BSP actually follows the workings of the US Federal Reserve and the Bank of International Settlements (BIS) where both have a public façade but with private bankers at the core (see “The Tower of Basel: The World’s Biggest Central Bank Has Private shareholders,” GlobalResearch, July 29, 2011).
Is there any wonder then why the People’s Republic of China is today the leading nation and economy in the world in terms of growth and stability? Its banking system is based on the concept of the “People’s Bank,” with its credit policies designed for national development and public welfare. Of course, this is not the case for the US and its satellites — such as Europe’s PIGS (Portugal, Italy/Ireland, Greece, Spain) — now reeling from the greed and machinations of so-called “banksters.”
But sadly, our Senate, House, and financial bureaucracy — from the Bureau of Internal Revenue to the Bureau of Customs et al. — all follow the diktats of Wall Street, IMF-WB, ADB, and Basel in keeping the Philippines perpetually in debt; in taxing us more to pay it off; and in privatizing public services to create more debt (like the call for P110 billion more borrowings after 10 years of privatizing the state’s power assets).
Our past national errors, such as the 10 years of fraud under Gloria Arroyo, should offer us concrete lessons in our nation’s political-economic history; our decision now should be to turn a completely new leaf — starting with a deeper understanding of our financial system.
(Tune in to Radyo OpinYon, Monday to Friday, 5 to 6 p.m., and Sulo ng Pilipino, Monday, Wednesday, and Friday, 6 to 7 p.m. on 1098AM; Talk News TV with HTL, on “Hello Garci: A Complete History,” with Atty. Alan Paguia, Saturday, 8 to 9 p.m., with replay at 11 p.m., on GNN, Destiny Cable Channel 8; visit http://newkatipunero.blogspot.com and http://hermantiulaurel.blogspot.com for our articles plus TV and radio archives)
Thursday, August 4, 2011
Condo buyers beware
CONSUMERS DEMAND!
Herman Tiu Laurel
8/1-7/2011
Several months ago I had received a number of texts from Wilson Lee Flores, Philippine Star columnist and real estate entrepreneur, warning of a condominium bubble building up.
The past few years, Metro Manila has been seeing its skyline changing like a major tectonic realignment pushing up steep cliffs and mountains astride major avenues and boulevards.
At the same time the boom in sub-urban residential subdivision spread like uncontrolled mushroom growth just south of Makati where new names of towns have been springing up, from that strange sounding Nuvali subdivision and Eton City, etc.
SMDC, the condominium development conglomerate of the SM group, has its billboards rising all over town, especially on EDSA where they have this billboard in front of their giant development near Boni Ave. while ubiquitous in-the-face giant bus ads pounce on commuters as their tambuchos puff out black smoke.
The boom seems to be going on forever.
A Buyers’ Market
Last week Wilson texted me again, pointing out a recent column by Amado Macasaet of Malaya reporting an apparent shifting of the rising expectation in the real estate and property market.
The title said it all, “Property now a buyer’s market”.
Here are some telling information from Macasaet’s article: “The Philippine National Bank is cutting down its equity requirement for housing borrowers by 50 percent, from 20 percent to 10 percent. Before the Aquino administration took over the reins of government, equity requirement, not only for housing but for nearly all types of borrowers, averaged 40 percent….
“Three other banks surveyed by Malaya Business Insight require equity of between 20 percent and 10 percent….
“Metrobank has the longest repayment period of up to 25 years. The average among the rest of the banks is 20 years.”
While Macasaet is seeing the glut one giant realty group executive he interviewed opined differently.
Collapse in Imminent
The executive says that property development “will never be overbuilt for as long as the players are building homes and apartments for the low and low middle market….
“The A-1 market which is small in number but has all the money to buy expensive apartments…. The demand for homes … will continue to expand.”
But then, the US housing mortgaged collapse was also built on direct home buyers and users. It wasn’t the lack of a market but instead the collapsing real economy in the US as jobs dwindled and real incomes shrank while the credit bubble exploded on securitization and financial pyramiding of the banks and investment packagers and speculators.
Every human being needs housing, but if they have lost the incomes needed to keep amortization going a collapse is imminent.
Do economic conditions in the Philippines, as it is also impacted by World economic conditions, augur well for a continued real estate boom in the country or is Macasaet and Wilson Flores’ fears more real.
Less means More
The real estate developers in the Philippines has been cashing in on loopholes in the tax system giving discounts to those categories that fall under social housing, including the design features of the condo units.
Many of these loopholes simply mean less amenities in condo living for those now buying into or renting in condos.
In one of our regular discussion in our Wednesday edition of Radyo OpinYon with Liza Gaspar, our OpinYon Economics Perspective editor and “Moneyed View” columnist, we were told of the discomforts of living in these new condo units with their very limited head room and ventilation where air-conditioning become a costly necessity, and high cost of common charges offset what benefits may accrue from savings on transportation fare and time.
Liza was comparing her present condo life to the previous years when she shared facilities in those old apartment units where there were at least more windows and elbow room and no condominium fees to pay.
Suburban Life
Those new subdivisions south of Makati may take off only after the problem of high cost of the South expressway and skyway fares are resolved in favor of commuters.
Especially after the Supreme Court’s recent decision making the EVAT of 12% on toll fees legal, suburban living in these new towns 20 – 50 kms away from work or school becomes more difficult.
A friend, Joe Escartin, sold his house in the South to live in a condo at Katipunan to his only child the daily travel to UP Diliman.
The move supports the condo market in Quezon City but would weaken the real estate prices in the South.
The real big middle class condo market is the dollar earning OFWs, albeit many markets are like the troubled Middle East/North Africa and Fukushima hit Japan are shrinking.
Government is underplaying the impact of these but manpower export companies see serious impairment.
Then there’s the US debt crisis that will inevitably further erode the US Dollar.
Do these factors augur well for the Philippine real estate sector?
Bubble nearly Bursting
Wilson Flores texted some more: “Philippine government has no social conscience to discourage over investment in condos and should boost agriculture and factories for more jobs …
“Philippine realty glut of condos maybe because electricity too high and other problem, so no factories or agricultural ventures...”
In telegraph fashion, Flores has put my own thoughts on this issue in a very short gist.
We are seeing a real estate balloon building up but because the real economy does not support the jobs and income generation for the people on a long term basis to support the multiplying condo and subdivision units running into tens of thousands every year, the market will dry out.
Much of the consumers’ incomes already go to basic public utilities like electricity, water, telecoms and toll fees which are all priced with predatory greed and allowed by an oligarch-captured Congress and regulatory agencies.
The indicators of this bubble nearing bursting are the premium payments and interest rates on them precipitously declining.
No to Future Deliveries
Consumers, commuters and home seekers should demand that government stop turning a blind eye and take action on these issues, save the real estate sector, rationalize the condominium market and protect buyers.
Buyers, on the hand, should be more coy now in jumping on to the real estate buying bandwagon the realty developers massive ad campaigns are trying to fuel, we should take our cue from concerned observers and journalists like Wilson Flores and Amado Macasaet – Buyers Beware.
This is the time for condo and home buyers to press for more concessions from developers, wait for actual finished units and not future deliveries, in this way prices can be forced even lower to the benefit of new home buyers and users.
(Tune in to Radyo OpinYon, Monday to Friday, 5 to 6 p.m., and Sulo ng Pilipino, Monday, Wednesday, and Friday, 6 to 7 p.m. on 1098AM; Talk News TV with HTL, Tuesday, 8 to 9 p.m., with replay at 11 p.m., on GNN, Destiny Cable Channel 8; visit http://newkatipunero.blogspot.com and http://hermantiulaurel.blogspot.com for our articles plus TV and radio archives)
Herman Tiu Laurel
8/1-7/2011
Several months ago I had received a number of texts from Wilson Lee Flores, Philippine Star columnist and real estate entrepreneur, warning of a condominium bubble building up.
The past few years, Metro Manila has been seeing its skyline changing like a major tectonic realignment pushing up steep cliffs and mountains astride major avenues and boulevards.
At the same time the boom in sub-urban residential subdivision spread like uncontrolled mushroom growth just south of Makati where new names of towns have been springing up, from that strange sounding Nuvali subdivision and Eton City, etc.
SMDC, the condominium development conglomerate of the SM group, has its billboards rising all over town, especially on EDSA where they have this billboard in front of their giant development near Boni Ave. while ubiquitous in-the-face giant bus ads pounce on commuters as their tambuchos puff out black smoke.
The boom seems to be going on forever.
A Buyers’ Market
Last week Wilson texted me again, pointing out a recent column by Amado Macasaet of Malaya reporting an apparent shifting of the rising expectation in the real estate and property market.
The title said it all, “Property now a buyer’s market”.
Here are some telling information from Macasaet’s article: “The Philippine National Bank is cutting down its equity requirement for housing borrowers by 50 percent, from 20 percent to 10 percent. Before the Aquino administration took over the reins of government, equity requirement, not only for housing but for nearly all types of borrowers, averaged 40 percent….
“Three other banks surveyed by Malaya Business Insight require equity of between 20 percent and 10 percent….
“Metrobank has the longest repayment period of up to 25 years. The average among the rest of the banks is 20 years.”
While Macasaet is seeing the glut one giant realty group executive he interviewed opined differently.
Collapse in Imminent
The executive says that property development “will never be overbuilt for as long as the players are building homes and apartments for the low and low middle market….
“The A-1 market which is small in number but has all the money to buy expensive apartments…. The demand for homes … will continue to expand.”
But then, the US housing mortgaged collapse was also built on direct home buyers and users. It wasn’t the lack of a market but instead the collapsing real economy in the US as jobs dwindled and real incomes shrank while the credit bubble exploded on securitization and financial pyramiding of the banks and investment packagers and speculators.
Every human being needs housing, but if they have lost the incomes needed to keep amortization going a collapse is imminent.
Do economic conditions in the Philippines, as it is also impacted by World economic conditions, augur well for a continued real estate boom in the country or is Macasaet and Wilson Flores’ fears more real.
Less means More
The real estate developers in the Philippines has been cashing in on loopholes in the tax system giving discounts to those categories that fall under social housing, including the design features of the condo units.
Many of these loopholes simply mean less amenities in condo living for those now buying into or renting in condos.
In one of our regular discussion in our Wednesday edition of Radyo OpinYon with Liza Gaspar, our OpinYon Economics Perspective editor and “Moneyed View” columnist, we were told of the discomforts of living in these new condo units with their very limited head room and ventilation where air-conditioning become a costly necessity, and high cost of common charges offset what benefits may accrue from savings on transportation fare and time.
Liza was comparing her present condo life to the previous years when she shared facilities in those old apartment units where there were at least more windows and elbow room and no condominium fees to pay.
Suburban Life
Those new subdivisions south of Makati may take off only after the problem of high cost of the South expressway and skyway fares are resolved in favor of commuters.
Especially after the Supreme Court’s recent decision making the EVAT of 12% on toll fees legal, suburban living in these new towns 20 – 50 kms away from work or school becomes more difficult.
A friend, Joe Escartin, sold his house in the South to live in a condo at Katipunan to his only child the daily travel to UP Diliman.
The move supports the condo market in Quezon City but would weaken the real estate prices in the South.
The real big middle class condo market is the dollar earning OFWs, albeit many markets are like the troubled Middle East/North Africa and Fukushima hit Japan are shrinking.
Government is underplaying the impact of these but manpower export companies see serious impairment.
Then there’s the US debt crisis that will inevitably further erode the US Dollar.
Do these factors augur well for the Philippine real estate sector?
Bubble nearly Bursting
Wilson Flores texted some more: “Philippine government has no social conscience to discourage over investment in condos and should boost agriculture and factories for more jobs …
“Philippine realty glut of condos maybe because electricity too high and other problem, so no factories or agricultural ventures...”
In telegraph fashion, Flores has put my own thoughts on this issue in a very short gist.
We are seeing a real estate balloon building up but because the real economy does not support the jobs and income generation for the people on a long term basis to support the multiplying condo and subdivision units running into tens of thousands every year, the market will dry out.
Much of the consumers’ incomes already go to basic public utilities like electricity, water, telecoms and toll fees which are all priced with predatory greed and allowed by an oligarch-captured Congress and regulatory agencies.
The indicators of this bubble nearing bursting are the premium payments and interest rates on them precipitously declining.
No to Future Deliveries
Consumers, commuters and home seekers should demand that government stop turning a blind eye and take action on these issues, save the real estate sector, rationalize the condominium market and protect buyers.
Buyers, on the hand, should be more coy now in jumping on to the real estate buying bandwagon the realty developers massive ad campaigns are trying to fuel, we should take our cue from concerned observers and journalists like Wilson Flores and Amado Macasaet – Buyers Beware.
This is the time for condo and home buyers to press for more concessions from developers, wait for actual finished units and not future deliveries, in this way prices can be forced even lower to the benefit of new home buyers and users.
(Tune in to Radyo OpinYon, Monday to Friday, 5 to 6 p.m., and Sulo ng Pilipino, Monday, Wednesday, and Friday, 6 to 7 p.m. on 1098AM; Talk News TV with HTL, Tuesday, 8 to 9 p.m., with replay at 11 p.m., on GNN, Destiny Cable Channel 8; visit http://newkatipunero.blogspot.com and http://hermantiulaurel.blogspot.com for our articles plus TV and radio archives)
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