As demand for condominiums in Metro Manila has turned tepid, real estate developments are now shifting to the regions.

Top developers such as Megaworld Corp., Ayala Land, Brittany and DMCI Homes, based on the recent report of Colliers have joined the trend.

Joey Roi Bondoc, Colliers director and head of research, as of the third quarter, Colliers data showed the remaining inventory in Metro Manila reached 75,300 units.

“It will take about 5.8 years to fully sell out all these unsold condominium units, nearly five times compared to the pre-pandemic period from 2017 to 2019, where remaining inventory life ranged between 0.9 and 1.1 years,” he said.

Of the 75,300-remaining inventory, 27,200 are ready-for occupancy (RFO) valued at P154.4 billion.

Lower to upper mid-income segments (P3.6 million to P12 million a unit) accounted for 57 percent of the remaining RFO inventory in Metro Manila as of the third quarter of 2024.

Meanwhile, the submarkets with high levels of unsold RFO units include Pasig, Quezon City–South, Parañaque, Manila North, Makati Fringe and Quezon City–North.

Colliers recorded the launch of 8,000 units in the Metro Manila pre-selling market in the first 9 months of 2024, down 61 percent year-on-year. Meanwhile, only about 9,300 pre-selling units were sold during the period, down 53 percent.

High-growth regions

Meanwhile, to offset the tepid demand in Metro Manila, Colliers continues to see the launch of new projects in high-growth regions, including cities and provinces in CALABARZON, Central Luzon, Central Visayas, Western Visayas, Northern Mindanao and Davao Region.

“From 2021 to 2023, we recorded an average growth of between 30 percent to an astounding 3,000 percent condominium launches in select provinces in these regions, with take-up growing from 17 percent to 445 percent.”

Horizontal projects (house-and-lot and lot-only) recorded a growth of between 15 percent and 138 percent in launches, and take-up grew from three to 60 percent in 2023 compared to 2021.

“Results from our previous surveys show that provinces in these areas are among the most preferred by respondents for their next residential investment. These regions are also among the major recipients of remittances from Filipinos working abroad, covering more than half of the 2.16 million deployed Filipino workers in 2023 and this should partly support the stable demand for residential end-use,” Bondoc further explained.

In a separate report, the Bangko Sentral ng Pilipinas said these regions also accounted for nearly 66 percent of total real estate loans granted by Philippine banks in the second quarter of 2024.

Bondoc said developers should take advantage of the thriving demand for resort or leisure-oriented properties outside Metro Manila.

“Among the property firms that already offer leisure-themed residential projects outside Metro Manila include Brittany, DMCI Homes, Rockwell Land, Megaworld Corp., Ayala Land, Robinsons Land, Cebu Landmasters and Damosa Land with projects located in Cebu, Davao, Bohol, Palawan, Boracay, Cavite, and Batangas,” he said.