The residential condominium market in Metro Manila showed mostly tempered growth in the second quarter of 2025, according to real estate brokerage firm Leechiu Property Consultants Inc.
While financing conditions are improving for buyers, driven by declining interest rates, attractive developer payment terms, discounts and value-added features, declining rental yields may be discouraging investors seeking passive or rental-income based returns, Leechiu Property said.
Despite competitive terms and value-added features offered by developers, demand remained tempered by softening appetite from passive investors and speculative buyers. Rental yields continue to be affected by corrections related to the exit of Philippine Offshore Gaming Operators (POGOs) and the likely high availability of units for lease.
“Demand drivers remain strong, developers are offering more lenient payment terms, and financing conditions are becoming more favorable,” said Roy Golez, director of research, consultancy and valuation at Leechiu Property.
“However, actual sales continue to lag as buyers are held back by declining rental yields and the perception of overpricing,” he said.
“We believe the developer-buyer relationship has to evolve and deepen into a mutually beneficial arrangement and not just rely solely on price-based incentives. They can focus on income-enhancing and risk-reducing measures—such as rent support programs, enhanced and sustained after-sales services. These can help give buyers the confidence to invest despite the current yield-challenged market,” said Golez.
New residential condominium launches in Metro Manila increased by 31 percent in the second quarter to 1,761 units, indicating moderately improved developer confidence. Take-up rose 2 percent to 6,643 units, supported by improving financing conditions.
For prime village buyers, options south of Metro Manila are becoming increasingly attractive, with prices offered at a significant discount compared to traditional choices in core central areas.
Prices for golf and country club shares surged by up to 669 percent above pre-pandemic levels in the fourth quarter of 2023, but prices have remained relatively flat since then, indicating tepid demand for existing shares. Meanwhile, more golf communities are set to emerge in the south, offering buyers a wider range of options.
Improved accessibility from existing infrastructure projects, affordability and well-planned townships are driving buyer preferences to shift outside Metro Manila. This trend has been made possible by the participation of top developers introducing a wide range of high-quality, master-planned developments.
In the Visayas, the majority of the remaining residential condominium supply in Cebu province is located in Metro Cebu. Demand declined by 15 percent, from 2,763 units in the second half of 2024 to the first half of 2025, while supply increased by 14 percent to 3,195 units over the same period.
The middle-income segments, particularly the two lowest sub-segments, performed strongly in the first half of the year, followed by the high-end and luxury segments. However, caution is still warranted, as the current supply stands at 27 months.
