The Philippine real estate industry looks back on a year characterized by adaptability, tenacity, and a steady recovery as the year ends. The industry showed incredible resilience and inventiveness in the face of persistent difficulties, navigating through ambiguity and blazing a path for stability and expansion. As the year comes to an end in the exciting world of Philippine real estate, 2023 will be remembered as a year of perseverance, creativity, and adaptation in the sector. As a pioneer in the development of luxury real estate, Crown Asia has shaped this narrative of transformation against a backdrop of changing desires and altering environments.
With a reputation for creating sophisticated and exquisite living spaces, Crown Asia has never stopped raising the bar for Philippine real estate. The company has continually pushed boundaries, bringing cutting-edge designs, facilities, and lifestyle concepts inspired by Italian architecture that speak to the contemporary Filipino homeowner even in the face of 2023’s complexity.
Philippine Real Estate 2023 Wrapped
As the year comes to an end in the exciting world of Philippine real estate, 2023 will be remembered as a year of perseverance, creativity, and adaptation in the sector. As a pioneer in the development of luxury real estate, Crown Asia has shaped this narrative of transformation against a backdrop of changing desires and altering environments.
Amidst robust economic expansion, the housing market with Philippine properties is beginning to show indications of improvement. According to data from Colliers International, the average cost of a luxurious three-bedroom condominium unit in Metro Manila’s central business districts (CBDs) increased by a meager 3.93% in 2022 to PHP 195,750 (US$3,588) per square meter (sq. m). Last year’s prices for luxury residences in CBDs decreased by 3.82% when inflation was taken into account.
In Q42022, house prices increased by 1.59% every quarter, but in actual terms, they decreased by 0.62%.
Additionally, demand is rising. Colliers report that pre-selling activity in the CBDs increased in 2022, with 20,000 units sold, up 54% from just 13,000 units sold in 2021. However, it is still significantly less than the 40,000–50,000 units sold before the epidemic.
Between 2010 and 2018, the Philippines saw a boom in home values, with prices in CBDs soaring by 125% (77% adjusted for inflation). However, the US-China trade war and a faltering domestic economy caused the property market to collapse dramatically in 2019. Inflation-adjusted house prices rose by just 0.9% and fell by 1%. The Covid-19 pandemic worsened the situation in 2020 and brought the housing market to an all-time low. According to the Global Property Guide’s 2020 Global Home Price Survey, the Philippines is the worst-performing housing market, with CBD home prices falling by 13.2% (or -16.1% when adjusted for inflation). According to Global Property Guide’s 2021 Global House Price Survey, the housing market remained the second weakest in the world in 2021 despite prices decreasing by 6.5% (or -9.8% when adjusted for inflation).
It is anticipated that the housing market will keep improving this year.
Collier’s Optimism with the Market Recovery
Colliers International Philippines’ Research Director, Mr. Joey Roi Bondoc, expressed optimism for this year’s improved recovery prospects. Colliers anticipates that the secondary market in Metro Manila will see an improvement in vacancies, which should lead to a rise in rents and prices.
He went on to say that while local workers’ demand has been driving up rent in major business districts like Makati, Fort Bonifacio, and Ortigas, they continue to receive inquiries from foreigners. In 2023, they anticipate that developers will still be queuing up new condominium projects. Developers and investors should monitor consistently rising inflation and its possible effects on interest and mortgage rates in the near to medium term.
However, it is still significantly less than the 40,000–50,000 units sold before the epidemic.
Between 2010 and 2018, the Philippines saw a boom in home values, with prices in CBDs soaring by 125% (77% adjusted for inflation). However, the US-China trade war and a faltering domestic economy caused the property market to collapse dramatically in 2019. Inflation-adjusted house prices rose by just 0.9% and fell by 1%. The Covid-19 pandemic worsened the situation in 2020 and brought the housing market to an all-time low.
As of 2023, the Philippine real estate market is expanding and enjoying the post-COVID momentum along with an increase in leasing and outsourcing activities. According to a Santos Knight Frank press conference, Manila’s office occupancy rate has significantly improved to 80%, which is a significant improvement over the lowest point of the previous year.
Manila’s premium home market has seen an incredible price increase, with prices rising at the quickest rate in the world (21.2%). Strong investor confidence during the current government is credited with this growth. Simultaneously, the nation’s GDP increased by 5.9 percent in Q3, largely due to foreign investments in industries including manufacturing, IT services, and electronics.
When it comes to office spaces, businesses are looking ahead, as evidenced by the 87 percent of them that expect to implement an office-centric strategy in the next three years. Gyms, mental health services, and food and drink options are all sought office amenities. The logistics industry has been impacted by the “revenge spending” phenomenon in the retail sector, which has increased consumer spending. The first half of 2023 saw a significant 30% increase in warehouse lease rates in Manila, the highest increase in the Asia Pacific area.
Embracing the Technological Progress
The real estate industry kept up its digital revolution in 2023. Technological improvements drastically changed the market, making online commerce, augmented reality, and virtual tours commonplace. To satisfy the changing needs of tech-savvy consumers, real estate developers and agents embraced digital platforms, altering how properties are marketed, viewed, and sold.
Changes in Preferences for Housing
The pandemic forced people to reassess their housing needs, which resulted in a spike in demand for homes that emphasized room, practicality, and holistic living. The need for homes with designated workspaces, green spaces, and facilities that promote a healthy lifestyle has increased due to the development of remote work arrangements. Developers were encouraged by this change to rethink residential developments by prioritizing open floor plans and community-focused elements.
Adjusting to Shifting Preferences and Needs
This year has seen a significant shift in consumer tastes in the housing sector, with a rise in demand for homes that accommodate the new standards of living and working. In response, Crown Asia skillfully included adaptable areas, separate home offices, and roomy floor plans in their constructions. These innovative changes demonstrate the brand’s keen awareness of changing consumer demands.
Ecological Development and Community-Based Projects
In 2023, Crown Asia’s dedication to environmentally friendly practices and projects that benefit the community did not falter. The brand has led the way in promoting environmental responsibility and holistic living through various projects, such as eco-conscious building processes and the development of lively and inclusive neighborhoods.
Boosting Infrastructure and Regional Growth
The expansion of regional areas was facilitated by Crown Asia’s strategic development plans, as urbanization spread beyond conventional hubs. The brand’s careful consideration of infrastructure and focus on building interconnected communities were key factors in the growth of real estate opportunities outside of urban areas.
Overcoming Obstacles with Resilience
Similar to the real estate industry as a whole, Crown Asia faced difficulties all year long. Obstacles included market turbulence, foreign disturbances, and economic uncertainty. Nonetheless, the brand’s adaptability, flexible tactics, and everlasting dedication to quality made sure that these difficulties were addressed with proactive fixes and cutting-edge methods.
What to look forward with Philippine Real Estate 2024
Colliers expects the National Capital Region (NCR) to see further expansion in office and residential properties by 2024, according to the Manila Bulletin. As the effects of COVID-19 fade, a gradual return to on-site work is anticipated to drive this. The estimate highlights better leasing in significant commercial centers including Makati CBD and Ortigas Center, with a projected 3.2 percent increase in rates by the end of 2023.
Colliers anticipates a large rise in new residential units, totaling 9,620 by 2024, with a considerable part located in the Bay Area, even though just two projects were completed in Q3. Residential property demand is a result of returning ex-pats looking for larger apartments close to international schools and places of employment.
Seeing this tendency, Colliers advises developers to look into leisure-oriented homes outside of Metro Manila to satisfy the increased demand that will arise after the epidemic.
The research highlights a notable 18.7 percent increase in vacancies in the office sector in Q3. As supply continues to exceed demand, elevated vacancy levels are anticipated in 2024. The study suggests increasing landlord engagement events and moving toward flexible workplace alternatives as solutions to this problem to revive interest in going back to traditional offices.
Looking Ahead: Projecting Real Estate Trends for 2024
The year 2024 promises to be a promising one for the Philippine real estate industry, full of innovations, opportunities, and dynamic shifts. With a bright future ahead of it, luxury real estate mainstay Crown Asia is well-positioned to stay a major participant by providing a wide range of innovative products that fit in with this year’s predicted trends.
A Tech-Powered Real Estate Journey
The year 2024 promises to bring even more technology into the real estate industry. Crown Asia is at the forefront of these innovations, from blockchain-based transactions to virtual property tours. Through the use of digital platforms, the brand will offer immersive experiences that make it convenient and accessible for prospective purchasers to view properties from a distance.
Household Sector Organization
The residential sector of the Philippine real estate market is still thriving, driven by changing consumer tastes. The market is anticipated to be driven by the need for large, multipurpose residences that accommodate remote work arrangements and facilities that promote well-being. It is expected that developers will shift their focus to creating creative housing options that meet these changing demands.
Transformation of Commercial Real Estate
In 2024, the commercial real estate industry is expected to experience a resurgence and change. As the effects of the pandemic are gradually being felt less, office buildings, retail establishments, and mixed-use developments are experiencing a resurgence of confidence. Future developments in sustainability and technology will influence commercial real estate, creating consumer-focused workplaces and contemporary, flexible work settings.
The Philippine real estate industry is anticipated to undergo a revolution due to the increasing adoption of technical improvements, particularly in the form of digitalization. The entire real estate experience will be improved by innovations like virtual property tours, blockchain-based transactions, and AI-powered analytics, which will provide buyers, sellers, and investors with more ease and transparency.
Green initiatives and sustainability
The Philippine real estate market continues to emphasize sustainability. An increase in environmentally friendly developments that prioritize green spaces, energy efficiency, and eco-conscious design is anticipated in the market. To satisfy the rising demand for ecologically conscious real estate, developers plan to implement sustainable techniques.
Adaptivity and Resilience
It is admirable how resilient the Philippine real estate market has been in the face of adversity. As the sector rebounds from global disruptions, stakeholders are primed to exhibit adaptability, employing innovative strategies to address evolving market dynamics and consumer preferences.
Gazing Ahead with Hope and Vision
The year 2024 holds immense promise for the Philippine real estate market. With a proactive attitude towards technological integration, sustainability initiatives, and a strong grasp of developing consumer expectations, the sector is ready to redefine standards, drive growth, and offer dynamic opportunities across the varied spectrum of Philippine properties.
Crown Asia is well-positioned to carry on its tradition of excellence and innovation in the Philippine real estate market as the year draws to a conclusion. The company is positioned to lead the industry’s evolution in the coming years due to its innovative tactics and unrelenting focus on creating extraordinary living spaces.
As 2023 draws to a close in the Philippine real estate market, Crown Asia continues to be a shining example of creativity, refinement, and unshakable dedication. It is bringing luxury living and modern aspirations together to create a future where homeowners around the archipelago can realize their goals in stunning ways.
