Back to basics amid Philippine property volatility
To say that the Philippine property sector is constantly challenged by domestic and external factors would be an understatement.
Crisis after crisis
In the ’70s, the energy crisis hit the Philippine economy, with repercussions felt across key sectors, including property. The early to mid-’80s, meanwhile, were marked by political instability.
The mid-’90s saw a measure of recovery as the Philippines moved from being labeled as the “Sick Man of Asia” to becoming one of Asia’s new economic cubs. This, however, was short-lived, as the Philippine economy and property sector were hit hard by the Asian financial crisis in the late ’90s and the resulting depreciation of the peso.
Fortunately, the outsourcing boom helped lift the property market, especially the office segment from the early 2000s until the global financial crisis hit the property sector anew.
Office and residential markets were later buoyed by demand from Philippine offshore gaming operators (Pogos) from 2016 to 2019, until the pandemic partly wiped out Pogo-driven gains. The fallout extended to 2024 when President Ferdinand R. Marcos Jr. ordered a nationwide ban on Pogo operations.
Middle East conflict
Today, property developers are closely monitoring the Middle East conflict as remittances from here covered nearly a fifth of total remittances in 2025.
The situation, however, can be double-edged. With depreciating peso, overseas Filipino workers (OFWs) may send more remittances and raise the purchasing power of their households. However, it may also compel some to go back home and stay here for good. The latter is likely to adversely impact remittances from the Middle East in the near to medium term and stifle their families’ purchasing capacity.
The ensuing oil price hikes due to this conflict may also disrupt supply chain operations, raise prices of construction materials, and temper demand.
Highly cyclical
It should be noted though that just like any economic segment, the Philippine property sector is highly cyclical.
Based on Colliers Philippines’ observations, Philippine property price growth broadly tracks economic expansions and contractions over the past three decades.
Periods of sustained GDP growth–most notably during the Aquino and early Duterte administrations–coincide with strong capital value appreciation, reflecting higher household incomes, improved investor confidence, and greater access to credit.
Conversely, external shocks like the Asian financial crisis, global financial crisis, and the COVID‑19 pandemic are associated with clear slowdowns, underscoring the sector’s sensitivity to macroeconomic disruptions and global liquidity conditions.
Structural resilience
The data, however, would suggest that while economic downturns temporarily suppress property growth, the market demonstrates structural resilience over the long term.
Each major shock is followed by a recovery phase in which capital values eventually exceed prior peaks, supported by demographic growth, urbanization, and sustained housing demand.
The slower compound annual growth rate (CAGR) observed under the current administration, however, signals a normalization phase after the pandemic, indicating that future price growth is likely to be more measured and increasingly dependent on fundamentals like income growth, affordability, and financing conditions rather than on cyclical momentum.
Remaining relevant
Recalibration is therefore a must for developers to remain relevant.
We see property firms constantly innovating to fully take advantage of opportunities in the market–whether it’s in the office, residential, retail, leisure, or industrial segment. Evolution is crucial to achieving progression and developers must be on the look out for the next property segment or location that offers the greatest returns.
For investors, consider the basics again.
Prime location. As we say in real estate, location, location, location. Make sure that you invest in a property situated in an area with good rental and price appreciation potential. While being in a masterplanned community has become a popular option, it is also important to choose a location near public transport and infrastructure projects.
Rental prospects and price appreciation. Investors should focus on residential projects with strong leasing potential for employees, students, and young families. Properties near transport terminals, schools, offices, malls, and hospitals tend to be more attractive to tenants.
The Makati central business district (CBD), Fort Bonifacio, and Ortigas Center, for instance, remain key locations. Their strong daytime populations also support retail activity, which in turn boosts rental demand and price appreciation for nearby residential projects.
Innovative promos. Developers are offering attractive and innovative promos in the pre-selling and secondary markets. Buyers should compare these carefully to find the best deals, while also looking for banks that offer competitive mortgage rates and discounts.
Sustaining property growth
Looking forward, Colliers still sees a significant influx of new residential supply in Metro Manila beyond 2025.
The market is also expected to shift toward higher-end developments, with luxury and ultra-luxury condominiums comprising a growing share of new deliveries in 2026.
Improved inventory life, driven by tempered supply and flexible sales promos, signals a gradual market recovery. Aligning supply with genuine demand, especially amid changing economic conditions and buyer preferences, is essential for sustaining property growth in the years ahead.
