Condo stocks still healthy

published in Malaya Business Insight

July 13, 2017

​JLL, the leading property consultant in the Philippines and a Fortune 500 company, said some 125,000 residential condominium units are expected to be added to the total stock of the Metro Manila residential market from now until 2021.

In a report, JLL said most of which are located in Makati central business district (CBD) and its outskirts, Ortigas CBD, Bonifacio Global City (BGC), Quezon City and Bay City.

But JLL warned the completion schedules of some residential developments may be pushed back, similar to other property developments, due to the ongoing scarcity of construction workers. 

Despite a slowdown in residential development launches in Metro Manila in the first quarter, the Housing and Land Use Regulatory Board issued licenses to sell (LTS) to approximately 11,800 residential condominium units JLL said the residential sub-sector remained healthy in he first quarter of 2017 primarily driven by the information technology-business process outsourcing  industry and remittances coming from overseas Filipinos.

In  February 2017, remittances amounted to $4.3 billion, a 5.9 percent growth year-on-year.

The report said vacancy rates in the luxury condominium market in Makati CBD and BGC continued to dip to 3.1 percent in the first quarter  from 4 percent in the fourth quarter of 2016 driven by demand from expatriate employees in the outsourcing and offshoring sector.

Demand for mid-range condominium units is primarily coming from the overall improvement in the income level of Filipino workers which JLL said is due to increased employment and livelihood opportunities.

The mid-range market also had a strong support coming from OF remittances.

Makati CBD and BGC maintained their positions as having the highest rents, ranging from P630 to P1,000 per sq.m. per month for mid-range units and from P720 to P1,790 per sq.m. per month for high-end units. 

Mid-range residential units in the Ortigas/Mandaluyong sub-market had rents of P400 to P690 per sq.m per month. 

Meanwhile, capital value growth outpaced rent growth. Average capital values of luxury condominiums in Makati CBD and BGC in the first quarter  increased by 3.8 percent quarter-on-quarter. 

BGC and Makati CBD continued to command the highest selling prices in Metro Manila, with capital values in BGC ranging from P112,000 to P185,000 per sq.m. for midrange developments and from P152,000 to P192,000 per sq.m. for high-end developments. 

Makati CBD prices ranged from P110,000 to P160,000 per sq.m. for mid-range developments and from P175,000 to P 263,000 per sq.m. for high-end developments.


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