Makati CBD condo prices down 4.21% during the year to Q3 2022
The Philippines’ housing market conditions remain dismal, despite strong economic growth. The average price of 3-bedroom condominium units in Makati CBD fell by 4.21% during the year to Q3 2022, an improvement from a y-o-y decline of 16.28% in Q3 2021. Quarter-on-quarter, house prices in the CBD fell by 1.5% in Q3 2022.
House price boom ends
The Philippines experienced a house price boom from 2010 to 2018, with Makati CBD prices rising by more than 132% (76% inflation-adjusted) due to strong demand and rapid economic growth. But with a slowing domestic economy, coupled with the US-China trade war, the housing market slowed sharply in 2019, with real house prices falling by 1%. Worse, the coronavirus pandemic has aggravated the situation, causing house prices to plunge by double-digit figures since 2020.
Real house prices fell by 16.11% in 2020 and by another 9.81% in 2021.
Rents, rental yields; good yields at 5.4%
| Philippines: city centre apartment buying price, monthly rent (2-BR apartments) | |||
| Buying price | Rate per month | Yield | |
| Taguig City | $223,093 | $1,192 | 6.41% |
| Pasay City | $195,965 | $ 682 | 4.17% |
| Quezon City | $105,651 | $ 477 | 5.42% |
Recent news: economy growing strongly
The Philippine economy grew by 7.6% in Q3 2022, following year-on-year expansions of 7.5% in Q2 and 8.2% in Q1, according to the Philippine Statistics Authority (PSA). It was its sixth consecutive quarter of strong y-o-y growth, mainly driven by robust household spending, as well as rising fixed investment. This is on track with the government’s target of a growth of between 6.5% and 7.5% this year.
The economy grew by 5.6% during 2021, partially offsetting the record contraction of 9.6% seen in 2020, thanks to a strong rebound in manufacturing and construction, as well as due to a low base effect from 2020. Prior to the pandemic, the Philippine economy had been growing by an average of 6.4% annually from 2010 to 2019.
