Buying power, robust office sector and new markets outside the metro are the major factors now contributing to the bullish performance and optimistic outlook of the Philippine property sector.
“The increasing spending power of investors, including the middle class, is keeping the industry afloat,” according to Lamudi, the global real estate portal.
The strong domestic consumption is also driving property developers to upgrade, renovate and expand their retail assets, Lamudi noted.
A study conducted by Colliers International Philippines revealed that the retail property stock in Metro Manila has increased by 182,000 square meters to 5.9 million sqm. in the first quarter of 2015.
The commercial real estate services company noted the demand for office space has revved up the timing of construction of projects this year.
A robust office sector is a major, major catalyst for growth, Lamudi said, tracing this phenomenon to the strong performance of the business processing outsourcing industry.
“Three office buildings with 39,500 square meters of combined usable area were completed as of the first quarter of 2015. Colliers forecasts that at the end of 2015, close to 576,000 square meters of usable office space will be delivered,” Colliers said.
Another study by investment management firm Jones Lang LaSalle showed that Metro Manila is now one of the world’s Global 30 Megacities, joining the likes of New York, London and Tokyo.
This development has a significant impact on Manila’s luxury residential segment, placing Manila among the top in the Asia Pacific region in terms of sales – with prices growing by 5 percent in January to March compared to Jakarta’s 6 percent.
Developers and consultants cited the property markets outside of Manila as key factor in growing the property sector.
“Not to be outdone by Manila, other emerging markets from Luzon to Visayas and Mindanao have enjoyed the benefits of a strong domestic property sector, with notable developments in Tagaytay, Cebu, and Davao attracting not only affluent local investors but also foreign buyers and millions of overseas Filipino workers,” said Lamudi.