Developer financing schemes are helping sustain the condominium market despite a decline in residential home loans, property analysts said. In comments reported by BusinessWorld, analysts attributed the disconnect between rising condo prices and falling bank mortgages to buyers using in-house payment arrangements before eventually obtaining bank financing.
Condominium prices rebounded 11.1% quarter on quarter even as residential home loans declined, a trend analysts said reflects the role of developer-provided financing in bridging the gap for buyers who may not yet qualify for bank mortgages. These in-house schemes allow purchasers to spread payments over a set period, often with lower initial outlay, before converting to traditional bank loans.
The trend underscores the importance of developer financing in maintaining market activity amid tighter lending conditions. Analysts noted that while the practice props up demand, it also exposes buyers to risks if they fail to secure bank financing later. The condominium sector's resilience, however, suggests that developer schemes remain a key support for the property market.