Manila condo: Lower rates, better offers, signs of recovery: Buy now, or wait?
Q1 2025 sees green shoots amid rate cuts, buyer incentives, generous promos
Manila: Looks like the Philippine condo scene, still faced with a supply glut, is starting to strut its stuff again.
The first quarter of 2025 brought a welcome breeze of recovery to the residential property market, with condo demand up by 14%, according to Leechiu Property Consultants (LPC).
What’s fueling this bounce-back?
Think lower interest rates, tempting developer promos, and flexible payment plans that have both first-time buyers and seasoned investors perking up.
A market on the mend?
While the market’s feeling optimistic, experts are keeping things real. Global economic drama (geopolitics and and unpredictable capital markets) could still toss in a few surprises.
Developers? They’re playing it smart — clearing inventory first, especially in the mid-range and luxury spaces, before diving into new projects.
According to Leechiu Property Consultants (LPC) Inc., condominium demand in Metro Manila increased by 14% in Q12025, driven by interest rate cuts and aggressive promotional strategies from developers.
Cautious optimism
Manila faced a significant condominium oversupply, with an inventory expected to take more than two years to sell off at end-2024 demand levels.
Developers responded by reducing project launches, especially in middle-income and affordable segments, and offering more flexible payment terms for existing units.
LPC noted a positive start to 2025, though maintains a cautiously optimistic outlook for the rest of the year.
What should buyers do?
Roy Golez, Director of Research and Consultancy at LPC, cited the residential market's good start for the year, and doubled down on the need for developers to keep buyer incentives in place, such as flexible promos and payment terms.
For buyers, Golez said this is a “strategic time” to evaluate opportunities, given the supply-and-demand equation.
Key developments in Q1 2025
Condo demand up 14%: A total of 6,508 residential units were taken up in Metro Manila in Q1, supported by three consecutive quarters of policy rate reductions. Expectations of further easing helped improve buyer confidence.
Drop in new project launches: Developers held back on new launches, with only 1,347 units introduced in Q1 — a 77% decline from the previous quarter’s 5,928 units. This indicates a strategic focus on clearing existing inventory, particularly in the mid-range segment.
Loan performance improving: The non-performing residential real estate loan (NPRREL) ratio dropped to 6.3% in Q4 2024, down from its pandemic-era peak of 9.6% in Q3 2021. While this shows a positive trend, the ratio has yet to return to pre-COVID levels.
Buyer behaviour and developer tactics: Developers are responding to demand with creative promotions and competitive financing schemes. However, ongoing global economic uncertainty may temper short-term enthusiasm. Buyers are encouraged to thoroughly assess available deals to take advantage of favorable conditions.
Luxury segment sees setback: Sales in the luxury residential segment fell by 39% in Q1. Despite this downturn, long-term prospects remain strong as developers prepare to launch premium offerings in the coming years, increasing competition in the high-end market.
Sign up for the Daily Briefing
Get the latest news and updates straight to your inbox
