The Metro Manila residential property market showed signs of strengthening in the third quarter of 2025, with demand gaining traction and inventory levels trending toward lower volumes, according to Leechiu Property Consultants.
Metro Manila’s available condo supply dropped to 31 months from 37 months in the second quarter of 2025. The 31-month level signals progress toward a more balanced market, although further absorption is still needed, the property brokerage firm said.
Take-up, or sales, hit a seven-quarter high of 7,713 units amid lower interest rates and improving buyer sentiment. This sales momentum was coupled with a modest increase in new project launches, which inched up by just 0.3 percent quarter-on-quarter to 1,766 units, reflecting cautious optimism from developers focused on marketing existing inventory.
The market’s recovery is supported by resilient demand drivers, including gross domestic product (GDP) growth of over 5 percent in the first half of 2025, and overseas Filipino worker (OFW) remittances, which rose 3.1 percent year-on-year. These fundamentals continue to reinforce the market’s underlying strength.
However, affordability constraints and modest rental yields continue to temper buyer appetite, particularly among middle-income households. Sales in the Upper Middle to Luxury segments rose sharply, while the middle0Income bracket lagged behind, suggesting that high housing prices remain a key barrier to broader market participation.
Housing affordability remains a pressing issue in Metro Manila, where residential prices have significantly outpaced income growth. Since 2019, prices for a sample Makati condominium unit have surged by 38 percent, while average family income has risen by only 15 percent.
“The market is gaining traction with encouraging signs of recovery—take-up has reached a seven-quarter high, and inventory levels are trending toward lower months-of-supply,” said director for research, consultancy and valuation Roy Amado Golez Jr. of Leechiu Property Consultants.
“But while the market is moving in the right direction, the reality is that most of the available inventory remains out of reach for the average Filipino household. Addressing this affordability gap is essential if we want to invite broader participation and ensure inclusive growth in the residential sector,” said Golez.
Rental rates across key districts remain subdued, with lessors continuing to feel the effects of the exit of Philippine Offshore Gaming Operators (POGOs). Only the Ortigas–Mandaluyong district posted a 2 percent quarter-on-quarter increase, while most other districts recorded further declines.
Despite this, rental income can still be a factor in financing. In a case study of a P7.6 million studio unit in Makati, rental income could effectively cover the financing costs of ownership over the loan term, with net positive returns emerging toward the latter part of the payment period. This highlights the potential of rental income to support ownership, though buyers should still plan for funding to cover principal payments.
