Why condo oversupply is a blessing in disguise
In my 38 years in the real estate industry, I have seen cycles of boom and bust, waves of speculation, and periods of consolidation. But one thing has remained constant—real estate is never a one-size-fits-all market.
Yet, today, we are faced with sweeping narratives that paint the Philippine property sector as struggling due to an oversupply of condominiums. This is misleading at best, and dangerous at worst.
During my recent talk with Claro Cordero, head of Research at Cushman & Wakefield, we tackled this issue head-on in front of nearly a hundred developers. The objective was clear: to separate fact from fiction and provide an accurate perspective on the market dynamics shaping real estate today.
Localized, not industry-wide
Oversupply is not a blanket issue affecting the entire industry—it is highly localized.
Certain pockets of Metro Manila, particularly in the mid-market and investor-driven segments, have seen a surge in unsold units.
However, this does not reflect the broader health of the property sector, which continues to see strong demand in other segments—such as horizontal developments, luxury residences, and emerging secondary cities.
Truth be told, I was elated when I first heard the news of oversupply. For developers with a long term vision, this is not a crisis—it is an opportunity.
Secondary cities are moving forward
While oversupply concerns dominate discussions about Metro Manila, it’s important to highlight that the southern and northern corridors and key secondary cities like Cebu, Davao, and Iloilo are moving forward, largely unaffected by the condo surplus.
These cities continue to experience strong demand,
fueled by economic growth, infrastructure developments, and expanding business hubs.
Unlike parts of Mega Manila where investor speculation drove much of the condo boom, these cities have remained end-user-driven markets, where real demand aligns with supply. This further proves that the so-called “real estate downturn” is not universal—it is highly segmented and localized.
A cleansing period for the industry
Oversupply acts as a natural market filter, forcing out weak projects and short term players without a solid foundation.
For too long, the real estate sector has been abused. Any business owner with capital could launch a condo project without a long term model or vision. Many of these were driven purely by speculation rather than sustainable demand.
Now, we are entering a phase where only the strong will survive. Developers with robust planning, financial discipline, and a true understanding of market fundamentals will thrive. This is the industry’s version of “weeding season”—a necessary cleansing period that will elevate overall market standards.
Institutional developers must protect industry
The Philippine real estate sector remains largely unregulated and fragmented.
Unlike more mature markets with strict entry barriers, our industry is still vulnerable to
fly-by-night developers who operate on a one-off basis, with little regard for long term
sustainability. This is where institutional developers must step up—not just to weather the current cycle but to protect the industry from disruptive short term thinking.
Collectively, the industry must push for higher standards in project planning, execution, and market discipline. Developers who have built a reputation for quality and credibility must set the tone, ensuring that the next wave of real estate growth is driven by sustainable demand, not speculation.
Adapt, innovate, and lead
For developers willing to take a long term perspective, this period presents a golden opportunity to reposition and strengthen their brands.
The shift is already happening: from speculative high rise projects to community -driven developments; from investor-focused sales to real end-user demand; and from short term profit-taking to long term value creation.
Instead of fearing oversupply, developers should use this time to refine their strategies, improve project quality, and reinforce broker and buyer confidence. The next phase of real estate growth will favor those who embrace innovation, sustainability, and market resilience.
A time for leadership, not panic
The narrative that the property sector is in trouble due to oversupply is false. The reality is that the market is maturing, evolving, and filtering out weak players. For those who understand real estate cycles, this is not a time for panic—it is a time for leadership.
Suburbs and identified secondary cities are proving that real estate growth continues where fundamentals are strong. The challenge now is for developers in Metro Manila to recalibrate, strengthen their positioning, and commit to long term sustainability.
Developers who focus on quality, long term planning, and market-driven innovation will emerge stronger than ever.
The question now is: who is ready to lead the industry into its next phase of growth?
The author is an executive director of W+B Advisory Group
