After a slowdown seen last year, Metro Manila’s residential condominium market has rebounded this year, with home buyers taking up more units than the new inventory rolled out by property developers in the first semester.
Based on estimates by property consulting firm Colliers Philippines, the take-up of condominium units offered under preselling arrangements in Metro Manila had increased by 23 percent year-on-year in the second quarter. For the first half, preselling of units in the metropolis rose by 5 percent to around 17,500 units.
Property developers launched 14,700 residential units in the metropolis in the first half, 21 percent lower than the number rolled out a year ago. For the second quarter alone, residential units launched declined by 54 percent year-on-year.
But the slowdown in residential launches may rebound soon, Colliers Philippines director for research and advisory Julius Guevera said, citing data from the Housing and Land Use Regulatory Board (HLURB) that applications for licenses to sell had increased in the first half. As developers had to apply for licenses to be able to sell, he said this suggested that launches might again pick up pace.
After peaking in 2012, property developers have held back new launches in the last few years to allow the market to absorb additional supply. In 2015, for instance, new residential projects in Metro Manila launched through preselling declined by 11 percent while the take-up of new inventory offered through such preselling activities likewise contracted by 18 percent, based on an earlier Colliers report.
This year, however, applications for licenses to sell continued to increase after a net decline in 2015. Total licenses issued by the HLURB rose by 52 percent year-on-year in the first five months of the year to 144,753 units. The licenses, however, are for new projects nationwide.
Meanwhile, Guevara said the oversupply of residential units in Metro Manila was tempered by delays in construction that in turn pushed back completion of several high-rise projects. The delay in completion was in turn attributed to the acute lack of skilled labor in construction.
“General contractors are feeling the pinch in the lack of labor, given the high number of construction projects being pursued not just in Metro Manila but all over the country. Delays are also seen in all property sectors, with residential and office being the most affected,” Colliers said in a report.