Demand for luxury condos in Manila remains strong

Citing a recent Colliers International Philippines’ latest residential report, Retalk Asia, a global real estate portal, indicated that luxury condominium demand should remain strong in Metro Manila because the city has one of the most attractive rental yields in the region owing to relatively low prices and sustained demand from affluent Filipinos, foreign investors, and offshore gambling firms.

“Manila’s luxury market is relatively small but has seen stable demand over the past few years. Projects being leased or sold to the secondary market continue to receive strong demand which entices affluent locals and foreign investors to look for similar developments in Metro Manila,” said the Retalk Asia post.

The report also noted the following Philippines residential market forecast at a glance:
• Demand: The take up for condominium units in the secondary market covering major business districts is sustained by demand from foreign and local professionals working in central business districts (CBDs). As of 1H 2018, about 30,000 units have been taken up in the pre selling sector. Colliers sees the take-up breaching the 60,000 mark in 2018.
• Supply: Colliers sees the delivery of at least 7,300 units in 2H 2018. Manila Bay, Fort Bonifacio, and Rockwell will likely account for 84% of new units in 2H 2018. Barring construction delays, Colliers expect about 8,600 units being completed annually from 2019 to 2021.
• Vacancy: Colliers sees overall vacancy rates in Metro Manila hovering between 11% and 12% by end-2018. From 2019 to 2021, Colliers see vacancy inching up to 12% to 13% per year as the completion of new units accelerates.
• Rent: From 2019 to 2021, Colliers sees a marginal rise in rents, projecting lease rates growth by 0.3% to 0.5% per annum during the three-year period as new supply from the Bay Area and Fort Bonifacio is factored in.

“Colliers report identifies that more affluent locals are seeing luxury condominiums as a viable investment option aside from the stock market. The shift in lifestyle also encourages high-end investors and end-users from posh villages to embrace condominium living,” said the report.

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Source: The Filipino Times