Property consultant Colliers said Metro Manila will see the turnover of nearly 11,300 condominium units this year, the biggest since the 11,700 units delivered in 2018.
After this, Manila will see the completion of 8,000 new condominium units up until 2026, Colliers said, much less than the nearly 13,000 residential units turned over in the capital region every year from 2017 to 2019.
Colliers said it recorded the delivery of 1,240 units in the fourth quarter of last year.
“This brought total completion in 2023 to 3,540 units, lower than our earlier forecast of 4,920 units due to delay in the completion of some projects, particularly in the Bay Area,” it added.
Joey Roi Bondoc, Colliers director of research, said the Bay Area will likely account for more than 60 percent of new supply during the period.
“We also expect this submarket to dominate other Metro Manila sub-locations in terms of condominium supply in 2024. By the second half of this year, the Bay Area will have the largest condominium supply across Metro Manila with 44,000 units, even higher than Fort Bonifacio’s total of 43,800 condominium units,” he said.
Colliers recorded the take-up of about 23,400 condominium units in the Metro Manila pre-selling market last year, an improvement from the 21,600 units sold in 2022, Bondoc said.
The affordable to lower mid-income segments (P2.5 million to P7 million per unit) dominated in terms of pre-selling condominium demand in Metro Manila, accounting for 57 percent of total take-up in 2023, he added.
Pre-selling condominium launches declined by 4 percent to 24,900 units in 2023.
“In our view, developers are becoming more cautious with their new residential launches especially with still sizable number of ready-for-occupancy (RFO) units in Metro Manila with remaining inventory life currently at 3.2 years,” Bondoc said.
Vacancy in the secondary residential market, at the same time, dropped to 16.8 percent as of end-2023.
Residential leasing in major business hubs, such as Rockwell Center, Fort Bonifacio, Makati central business district (CBD), Ortigas Center and the Bay Area, was mainly driven by returning expatriates from outsourcing, manufacturing and logistics industries.
“Some local employees that are starting to return-to-office (RTO) are actively looking for units to rent, taking advantage of rental corrections for studio and one-bedroom units in prime business districts such as Makati CBD, Fort Bonifacio, Bay Area, and Ortigas Center,” Bondoc said.
“We project rents and prices to grow albeit at a slower pace starting 2024. We attribute this to still elevated vacancy given the substantial number of RFO units in the secondary market. We see substantial addition to Metro Manila RFOs given the new units to be delivered especially in the Bay Area,” he added.
Colliers expects residential vacancy to increase to 17.7 percent in 2024, near the record-high vacancy of 17.9 percent recorded in 2021.
“We see vacancy in the Bay Area submarket rising to 28 percent, an all-time high, partly due to the completion of more than 7,000 new condominium units this year,” Bondoc said.
