IF real estate capital appreciation is any indication, there is no doubt the Philippines’ middle income population has risen. According to a report by global property services firm Jones Lang Lasalle (JLL) on Tuesday, Metro Manila’s luxury residential market registered the strongest price growth among eight monitored markets in the Asia Pacific as of the third quarter of 2015.
The report had it that in the 12 months ending in third quarter of 2015, prices for luxury residential properties in Manila increased by 13.2 percent from the previous year, topping Hong Kong (up 4.4 percent), Jakarta (up 10.6 percent), Beijing (down 0.4 percent), Singapore (down 9.1 percent), Shanghai (up 7.4 percent), Bangkok (up 0.1 percent), and Mumbai (up 1.4 percent).
Singapore saw the steepest year-on-year decline of 9.1 percent.
“In emerging Southeast Asia, continued positive performance of Manila’s economy underpinned demand for residential units, with sales of mid-to-high-end residential units remaining healthy, and capital values continuing to rise,” noted JLL’s Real Estate Intelligence Service, the source of the data.
For the third quarter alone, most monitored luxury residential markets in Asia Pacific saw flat or small gains in prices. Of the eight featured markets, only Manila, Beijing, and Shanghai saw price growth above one percent, while Singapore saw further declines (down 2 percent).
“Sales activity remained subdued in Singapore amid concerns about the economy, interest rate uncertainty, and ongoing cooling measures,” explained JLL. “As a result, prices maintained a downtrend, as caution prevailed.”
Beijing and Shanghai witnessed better-than-expected sales in the period, which led developers to continue raising their prices. JLL said further loosening of credit policies and robust upgrade demand were behind the upward momentum in luxury home sales in the two Chinese cities.
JLL said it expects “a mixed performance for sales across the region through the end of 2016.”
It noted that in China, an accommodative policy stance should continue to support sales volumes and developers are likely to launch more units due to the buoyant market sentiment.
“In emerging Southeast Asia, a healthy level of sales is expected in most markets in part due to more new launches,” said JLL. “Capital values in Beijing and Shanghai are expected to see moderate growth through the end of next year, supported by healthy local demand.”
But for Singapore’s residential market, the services firm anticipates further weakness.
“A further correction is anticipated in Singapore, while moderate price growth is forecast for most emerging Southeast Asian markets,” the JLL reported.