The luxury condominium market rebounded in the first nine months of 2022 as the segment accounted for 28 percent of total condominium take-up, a turnaround from a 1.6 percent contraction in the first nine months of 2021, according to Colliers.
Luxury condominiums are those priced P8 million and above.
According to Colliers, takeup was driven by projects located in major central business districts (CBDs) such as Fort Bonifacio and Ortigas CBDs.
“We believe t the ultraluxury segment will likely remain resilient amid the rising interest and mortgage rates,” said Joey Roi Bondoc, associate director and head of Research at Colliers.
Overall, pre-selling condominium takeup reached 6,100 units in the third quarter, up from 5,700 units sold in the second quarter. This brings a total takeup of 14,900 units in the first nine of months 2022, already outpacing full-year 2021 figures.
In 2021, Colliers recorded anemic takeup in the pre-selling market with only about 12,400 units sold. Colliers believes that residential demand should be supported by improving consumer and business sentiment in Metro Manila.
However, Colliers sees rising interest rates as among the headwinds in the residential market, especially their potential impact on mortgage rates. “Despite higher interest rates, we have seen a stable demand for upscale to ultraluxury condominium projects in Metro Manila,” said Bondoc.
Colliers noted that over the past few years there has also been a healthy level of price increases for these residential projects. In fact, on a per-square-meter basis, Metro Manila’s luxury and ultraluxury condominium prices are starting to catch up with the region’s most expensive.
“We believe that the increase in prices will only result in investors and end-users looking for greater amenities as well as innovative facilities,” said Bondoc. “Due to Metro Manila traffic, there will be greater demand for connectivity to master-planned communities and topnotch concierge services. With more luxury and ultraluxury projects being launched in Metro Manila, Colliers sees the rise of more discerning buyers. Hence, developers need to further innovate and differentiate in a highly competitive luxury residential segment.”
At present, the Philippines’ most expensive condo project is priced at P495,000 per square meter. Based on regional prices, it appears there is still room for further expansion of Metro Manila prices on a per-square-meter basis.
