I think we can all agree that we’ve had a pretty good time of it in the real estate market here for the last few years. A staggering figure that you probably didn’t know was that three years ago there was a 54% increase in the volume of properties sold in just that year compared to the last. Understandably, that wasn’t something that could last and the results have come in. In 2015 alone, there was a 20% drop in demand for condominiums. This is somewhat understandable with the drop in remittances coming out of the uncertainty within the global economy. Couple this with nearly 3 times the number of new units coming online over the next three years than is normal, and… well the disconnect is pretty obvious.
On the ground we’ve been seeing some dramatic price cutting in rental rates and properties for sale, for example, we have seen a P10,000 drop in the floor rental rate for a number of units in Avida Towers, which have typically commanded P25,000 per month for two bedroom properties, and developers have been finding it hard to move units (keep this in mind if you’re going for a developer constructed unit of your own).
It’s not necessarily a bubble as we have been predicting a market correction since the second half of 2015, but proper planning is required, and, if you plan well enough, you could snatch some deals as the market bottoms out. It is a buyers market after all.