Expert dismisses claim of condo oversupply, cites localized issues

A real estate expert dismissed claims of a widespread condominium oversupply in the Philippines, saying the issue is localized and the market is undergoing a necessary "cleansing period."

Enrique M. Soriano III of W B Advisory Group said the narrative of a struggling property sector due to oversupply is "misleading at best, and dangerous at worst."

"In my 38 years in the real estate industry, I have seen cycles of boom and bust, waves of speculation, and periods of consolidation," Soriano said in a statement. "But one thing has remained constant."

He said discussions with Claro Cordero, head of Research at Cushman & Wakefield, confirmed that oversupply is not a blanket issue.

"Oversupply is not a blanket issue affecting the entire industry—it is highly localized," Soriano said, pointing to specific areas in Metro Manila, particularly in the mid-market and investor-driven segments, that have seen an increase in unsold units.

He noted that other segments, such as horizontal developments, luxury residences, and emerging secondary cities, continue to experience strong demand.

Soriano said regions outside Metro Manila, including the southern and northern corridors and cities like Cebu, Davao, and Iloilo, are "largely unaffected" by the condominium surplus.

"These cities continue to experience strong demand, fueled by economic growth, infrastructure developments, and expanding business hubs," he said.

He attributed the oversupply in some areas to investor speculation, contrasting it with end-user-driven markets in other regions.

Soriano viewed the oversupply as a "natural market filter," forcing out weaker projects and short-term players.

"For too long, the real estate sector has been abused," he said. "Now, we are entering a phase where only the strong will survive."

He called for institutional developers to "protect the industry from disruptive short-term thinking" and push for higher standards in project planning and execution.

Soriano urged developers to adapt, innovate, and focus on long-term value creation.

"The narrative that the property sector is in trouble due to oversupply is false," he said. "The reality is that the market is maturing, evolving, and filtering out weak players."

He emphasized that developers focusing on quality, long-term planning, and market-driven innovation will "emerge stronger."