“There is now an oversupply of 29 months’ worth of condominium units in Metro Manila.”
Several property developers are quietly slashing prices on unsold inventory in a move that could be described as a “silent fire sale.”
This comes as developers grapple with an oversupply of residential and commercial properties, and as cautious buyers struggle with rising interest rates and inflation.
Santos Knight Frank director Lovelle Taleon said a “silent fire sale” is underway among property developers to reduce their unsold residential units.
“Regarding strategies to selling out the Metro Manila inventory, I think yes, there is a sort of a silent fire sale that has been happening. It’s a strategy that’s being implemented by all developers. The goal there is to sell it out. They don’t want to be holding on to the property anymore,” Taleon said.
Taleon said developers are keeping the sales under wraps, avoiding public promotions or large-scale advertising campaigns to prevent further market instability.
These discounts are reportedly being offered only to preferred clients and repeat buyers. Another strategy being implemented by property developers is offering huge discounts to bulk sales.
Property consultant Leechiu Property Consultants (LPC), in its recent report, said there is now an oversupply of 29 months’ worth of condominium units in Metro Manila.
As unsold inventory remains high, Taleon also expects property developers to significantly reduce their residential launches in the next two years.
DMCI Homes president Alfredo Austria said the company would not launch any new projects in the first half of 2025 as it aims to focus on selling unsold units in existing developments.
Austria said the company would evaluate prospects to determine if it would launch a new project in the second half of next year.
Property developers are counting on the continued reduction in interest rates to boost demand for mid-market and affordable housing projects.
The current high interest rates and high inflation dampened demand for residential condominiums in Metro Manila.
The Bangko Sentral ng Pilipinas (BSP) raised its benchmark interest rate to 6.5 percent from October 2023 to mid-August 2024. It reduced the benchmark rate to 6 percent during its October meeting.
