Metro Manila condo glut not a concern, say brokers

Real estate brokers and analysts said an oversupply of condominium units in Metro Manila is not a cause for worry, describing the situation as likely temporary, according to an ABS-CBN report, citing Colliers Philippines.

Colliers Philippines said in a forum that unsold ready-for-occupancy (RFO) units in Metro Manila reached P158 billion ($2.7 billion) in 2024, up from P89.6 billion in 2023.  Colliers Head of Research Joey Roi Bondoc estimated it would take over eight years to sell all units.

Bondoc said many developers are now limiting construction projects, while the government is working to attract new industries to the Philippines.

While Philippine Offshore Gaming Operators (POGOs) have left the country, other businesses are entering, driven by the boom in artificial intelligence development, he said.

“The POGOs have left the Philippines, but you now have AI software engineering companies locating in the Philippines, taking up massive office spaces,” Bondoc said.

The company remains optimistic about the condominium sector's growth in 2025.

One positive trend is the real estate industry's growth in the provinces, with many projects outside Metro Manila under construction and some nearly sold out.

“Look for resort leisure theme developments. We’re looking at Benguet, Baguio, Cebu, Davao, Cagayan de Oro, Bacolod, Iloilo. I think this is one segment of the residential market, the leisure-oriented sector, that will greatly benefit from the influx of foreign tourists,” Bondoc said.

He said areas like Cavite, Bulacan, Pampanga and Batangas are expected to see significant infrastructure development, which will boost property prices.

Speakers at the forum also highlighted opportunities for brokers and buyers.

Pasay-Makati Realty Board Inc (PMRB) president Glorie Marie Sy said now is the time for buyers to negotiate pricing or payment terms, noting some units have seen price drops and others are offering promotions.

“Now is the time to really push for a little bit of negotiation. Because why? There are so many promotions now that didn't exist previously,” Sy said.

Bondoc said developers are willing to extend downpayment terms up to 48 months. Pre-pandemic, you’d be lucky to have a downpayment term of 24 months.”

Moby Arquiza, co-founder of the ASEAN Real Estate Network Alliance, said the tourism sector also presents opportunities. Many unsold units can be used for rentals, increasing accommodation options for tourists.

“There are takers for that because of tourism. If I’m tourism-based, I’ll do Airbnb, I can get a very good deal from the developer. I’ll take ten units, twenty units,” he said.