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Real estate market in the Philippines in 2024: Performance, trends, and updates

real estate market in the philippines

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The real estate industry in the Philippines has expanded significantly due to the country’s strong economy, growing middle class, and expanding consumer purchasing power. Sustainable and mixed-use constructions have become popular trends, while residential and commercial properties, especially condominiums, have been in high demand. The government’s ongoing programs and infrastructure investments will further stimulate the real estate industry. In this article, we will explore how the real estate market in the Philippines will perform in 2024 and what the current trends are, and we share the latest updates.

The current state of the real estate market in the Philippines in 2024

There have been notable changes to the real estate market in the Philippines in recent years. In the real estate market update, between 2010 and 2018, the nation witnessed a surge in home prices, with Central Business Districts (CBDs) seeing a 125% increase in the housing market. The housing market saw a significant slowdown in 2019 due to the US-China trade war and a failing domestic economy. Although the house prices in the Philippines rose by a modest 0.9%, they fell by 1% when adjusted for inflation. A 13.2% decline in CBD property values was caused by the COVID-19 pandemic in 2020, which made matters worse. Nonetheless, the market has begun to strengthen. With 20,000 units sold in 2022—up 54% from 13,000 units in 2021—pre-selling activity in the CBDs resumed.

When taking a look at the most recent Philippine real estate news, we see the economy shows signs of recovery, with a predicted growth of 7.6% in 2022, followed by 5.7% in 2021 and a 9.5% drop in 2020. This positive trend can be attributed to the strong expansion in manufacturing, automotive repair, building, wholesale, and retail commerce. The real estate market in the Philippines is expected to continue recovering, with the Philippine government projecting a GDP increase of 6% to 7% in 2024. However, investors and developers should watch the sustained high inflation rate and its potential effects on interest and mortgage rates.

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Performance of residential properties

The residential real estate market in the Philippines has performed primarily well. According to the Bangko Sentral ng Pilipinas (BSP), the national residential real estate price index in 2022 increased by 7.7% after accounting for inflation, indicating a good improvement in the land appreciation rate in the Philippines. Demand for condos increased significantly, with house prices in the Philippines rising 12.9% over 2023. In contrast, the fourth quarter of 2022 saw a 4.9% drop in condominium prices. The biggest price gain in 2022 was recorded by duplex residences, which increased 42.9% yearly. The cost of single detached and attached homes also increased by 10% per year. However, in 2022, townhouse prices fell by 6.8%.

A 4% rise in residential building permits was observed in the first quarter of 2022 compared to the same time in the previous year, suggesting an excellent real estate trend in construction. Nonetheless, the value of residential building licenses decreased by 10.3%, while the floor area of residential building permits saw a slight decrease of 2.1%. The price of land in the Philippines varied depending on the type of residential construction. Duplex/quadruplex apartments had the lowest average building costs, while condominiums had the highest. The average cost to build a residential unit in the Philippines in the first quarter of 2022 was ₱10,893 ($191.67) per square meter.

In 2022, home rentals in Metro Manila experienced a 3.9% gain after two years of decline. With a total rate of 5.6% in 2022, Pasig City had the lowest residential vacancy rate in Metro Manila, while Taguig and Makati had the highest. The residential real estate market in the Philippines has usually shown positive price growth, diverse development activity, and modest rent increases despite varying vacancy rates across different areas.

Performance of commercial real estate

Within Metro Manila’s Central Business Districts (CBDs), the commercial real estate market has performed well in the last few years. A total of 151,200 condominium units were added to the CBD stock in 2022, a 6.3% increase. Deliveries of 9,000 condominium apartments in strategic locations, including Fort Bonifacio, Ortigas Center, Rockwell Center, Alabang, and Makati CBD, are responsible for this growth. About two-thirds of this additional supply came from the Bay Area.

Regarding residential completions, the CBDs had about 8,970 units finished in 2022, a slight 2.7% rise over the year before. In contrast to the 70% decrease in completions in 2020, this represented a notable improvement in the real estate market in the Philippines. It is estimated that between 2023 and 2025, 6,700 condominium units in the CBDs will be completed on average each year. 

The Bay Area stands out among the other condominium submarkets because of the offshore casino industry’s attraction. Due to its upscale amenities, which include restaurants, shopping centers, office towers, and international schools, Fort Bonifacio is still a popular place to live. With a 13.6% rise from 2022, Metro Manila’s total number of condominium units is expected to reach approximately 171,760 by the end of 2025. The commercial real estate industry of the real estate market in the Philippines in the central business districts of Metro Manila has shown resilience and development potential despite the obstacles presented by the COVID-19 pandemic.

Emerging trends in the Philippine real estate market

The real estate market in the Philippines is undergoing significant changes in real estate trends and movements due to shifting economic landscapes and consumer expectations. Here are five emerging trends in the Philippine real estate market:

  • The real estate market will continue to grow: Despite the economic uncertainty induced by COVID-19, the real estate market forecast for the next 5 years in the Philippines will likely continue to develop, maintaining its position as one of the largest markets in Southeast Asia.
  • Strong demand for commercial and residential properties: The real estate market in the Philippines is predicted to stay in high demand, with a growth in home sales, notably for flats and condos, while single-family homes remain inexpensive and a good investment option.
  • Expansion of hybrid workplaces: The popularity of hybrid work arrangements in the real estate industry in the Philippines is driving the demand for new retail space in Metro Manila, stimulated by enterprises outsourcing work and an overall increase in employment rates and pay.
  • Increased overseas investment: International property investors, notably Japanese firms, are becoming more interested in the real estate industry in the Philippines. It is backed up by possible trade agreements and major investments in various areas, signaling economic development prospects.
  • Tourism recovery fueling demand: The ongoing comeback of the tourism industry in the real estate market in the Philippines is predicted to increase demand for real estate properties, particularly in the hotel and lodging sector, generating possibilities for investors.

Buy and sell property in the Philippines with Own Property Abroad

Do you want to buy or sell property in the Philippines? Own Property Abroad can assist you and ensure a seamless and hassle-free property journey. Thanks to our knowledge and experience in the real estate market in the Philippines, we can help with legal requirements, finding suitable properties or buyers, negotiating the best deals, conducting due diligence, and more property-related matters.

With our expert team, you won’t have to navigate the complexities of the Filipino market alone. For further information on how we can assist you, kindly drop your details below or email us at hello@ownpropertyabroad.com. Let’s start working on your property success story today!

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Frequently Asked Questions (FAQs)

Is the Philippines a good place to invest in real estate?

The Philippines is considered a good place to invest in real estate. The country’s growing GDP, conversion of rural areas to economic zones, and urbanization contribute to the investment potential in the real estate market in the Philippines. Additionally, the market offers investment opportunities in various sectors, including the stock market, agricultural and industrial sectors, and commercial real estate.

How is the Philippine real estate market in 2024?

The Philippine real estate market in 2024 is expected to increase net take-up, supported by demand from various sectors, including Information Technology and Business Process Management (IT-BPM) firms. The real estate market in the Philippines is anticipated to show signs of recovery and growth, positioning it as an attractive investment opportunity for investors and potential homeowners.

What are the property trends in the Philippines for 2024?

Some property trends in the Philippines for 2024 are increased leasing and outsourcing activities and demand from companies from various sectors like legal, engineering, construction, government agencies, and IT-BPM firms. The post-COVID momentum is also contributing to expansion in the real estate market in the Philippines, and the government is investing in infrastructure, which will further boost the country’s real estate sector.

Is it smart to invest in real estate in the Philippines?

Yes, it is smart to invest in real estate in the Philippines. The economic growth of the real estate market in the Philippines and positive indicators in 2024 make it a good investment opportunity. The Philippine government is also implementing reforms and measures to make the country more attractive for foreign investors, including lifting some restrictions on foreign ownership of real estate properties.

Written by Therese Angeles

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