Lot-only projects’ gargantuan price appreciation potential
New lot-only projects in Metro Manila are proving to be among the more popular property investment options today.
Price appreciation for these projects has been evident in the Cavite-Laguna-Batangas (Calaba) corridor and the appetite is obviously spilling over to Metro Manila South.
Given the limited supply in the capital region and rising demand, the lot-only projects’ price appreciation potential is gargantuan. Aside from the limited launches, we attribute this to improving connectivity between Calaba and Metro Manila South; greater demand for greener and more open spaces; affluent market’s preference for premium amenities; and strategic location.
In our view, these features should ensure steady demand for lot-only projects in the capital region, making these developments ideal for an affluent and cash-rich market, and aspirational for a thriving middle class with growing purchasing power.
Thriving viability
In Batangas, residential lot-only projects posted a 7 percent annual price growth from 2016 to 2024, while those in Laguna recorded an annual price acceleration of 8 percent yearly. Lot-only developments in Cavite, meanwhile, posted 9 percent annual price growth in the same period.
It is no longer surprising to see developers seizing opportunities to ride on this growing subsegment by also launching lot-only projects in southern Metro Manila, including parts of Las Piñas and Muntinlupa, particularly Susana Heights where Signature Series by SM Residences is planning to launch premium lot-only residential development.
Strong appetite
The appetite for lot-only units remains strong.
Colliers’ recent Residential Survey showed that nearly 40 percent of our respondents are planning to buy a lot within or outside Metro Manila for their next residential investment.
Our recent poll also showed that more than 90 percent of our respondents believe that having green and sustainable features is important in purchasing a residential unit.
Close to 100 percent of respondents said they prefer greener and more open spaces. Respondents likewise noted that they prefer sustainable features for their next horizontal investment; open spaces and activity areas, easy access to essential goods and services; and integrated communities that exhibit the 15-minute city concept.
The shift to lots
Sustained price appreciation has been seen among lot-only projects in the Calaba corridor. With strong take-up from an affluent market diversifying investment options, Colliers is confident that lot-only projects to be launched within Metro Manila are also likely to post formidable capital value appreciation.
We also attribute the sustained demand to a large fraction of existing clientele putting a premium on sustainability and healthy spaces. Moving forward, we believe that sustainability will play a crucial role in stoking residential demand, as the pandemic highlighted the need to be in greener and more open spaces.
With more office developers acquiring healthy certifications, we see premium residential developers following suit.
Lastly, Colliers Philippines data show that lot-only projects in the Calaba corridor have recorded a sustained pace of price acceleration.
These make lot-only projects attractive right now, especially with slightly compressing residential yields for mid-income condominium units in the capital region. This attribute alone makes lot-only developments ideal hedges against inflation and attractive investment options in the years to come.
