Has the Philippine Real Estate Market Changed After the Pandemic?

Many wise investors will say that the best time to buy property was yesterday. But how long back? Were things better ten years ago versus today’s Philippine real estate market? Or, are there more factors to consider aside from actual prices? 

For this article, we’ll look back at the Philippine real estate market as well as the country’s economic profile ten years ago. We’ll also consider the economic impact brought about by the pandemic between 2020 and 2022. Hopefully, we’ll be able to answer the question that stymies some potential real estate investors from pulling the trigger. 

2013: A Good Year for Real Estate? 

Despite a series of natural disasters, the Philippines managed to exceed expectations and post a 7.2% Gross domestic product (GDP)  growth in the year of2013. It was the first time in over 23 years that the country posted two consecutive years of growth above 6%.  Everything was booming as far as the markets were concerned. The construction industry eagerly filled in demands for more than 500,000 sqm of office buildings in 2013. This represented a 28% year-on-year increase that became the record high back then. 

Meanwhile, residential demand gave way to more condominiums in Makati and Fort Bonifacio. While real estate prices were lower, buying power and wages were also lower. Additionally, the number of residential properties for sale was also lower, which led to higher demand. Over the past ten years, Philippine real estate residential prices have grown an average of 6.3% between 2009 to 2023. In 2013, the growth hovered between 8% and 9% which was higher than average. But, can Filipinos afford to buy property in 2013 compared to now? According to worlddata.org, one thousand pesos in 2013 is now only equivalent to P740.27 in today’s economy. However, salaries and exchange rates were also lower at the time. In fact, the US dollar exchanged for P44.41 at the close of 2013.

2020-2022: COVID Crashed the Party

Just when things are going really well with the Philippine real estate market, along comes COVID-19. The global pandemic effectively shut down the whole world. Along with the shutdowns are any appetites for investing in real estate properties. Going back to the data from Trading Economics, we see that the Philippines experienced a surge of 26.59% in residential real estate prices in the second quarter of 2020. This is mainly owing to a sudden uptick in demand for properties during the initial wave of shutdowns. 

Then, demand waned as construction ground to a halt by the following year. Residential prices plunged by -9.36% during the second quarter. With nothing new to sell, many buyers played the waiting game instead. More importantly, the pandemic gave homebuyers and investors a new priority. Instead of spending for the future, many had to dip into their reserves and spend what their families needed to survive.

2023: Is Now a Better Time to Enter the Philippine Real Estate Market?

The World Health Organization dropped COVID-19’s pandemic status by the first half of 2023. Along with the declaration was the assumption that everybody was free to return to business as usual. The Philippine real estate market happily went back to work, construction resumed for halted projects and delayed groundbreakings. Of course, demand went back up as well. As of March 2023, property prices were up by 10.23% compared to the same time during the previous year. 

While properties are more expensive compared to those sold ten years ago, improvements in home technology have made their way into finished units. Smart homes that can reduce energy consumption while making most tasks easier for household members were introduced to the market. In addition, many properties now offer in-house broadband connectivity and lots of activities within the building.

More importantly, many middle-class families are in a better position to buy properties. OFWs in particular are getting a windfall as the US dollar goes for P58 pesos, which is 20% higher compared to rates in 2013. This means that with the same work ten years ago, OFWs are receiving bigger amounts thanks to today’s conversion rates. Add the fact that salaries have grown over the last ten years. With more disposable income, many OFWs are taking the smart strategy of investing in real estate.  

Some critics would say that housing prices are too high at the moment. However, Colliers Philippines pointed out that when adjusted for inflation, many residential (especially condominium) prices are actually lower by nearly 4%. Demand is increasing even as new projects are rising from the ground. Rent prices are already increasing in high-traffic areas such as Ortigas, BGC, and Makati. In addition, property will historically go up over time. 

What they say about buying property five years ago still rings true. In this case, however, buying property now can be a smart investment if the Philippine economy continues to chug along nicely.  

Ohmyhome Closes Follows the Philippine Real Estate Market

Are you looking for worthwhile properties to place your hard-earned money? If so, let Ohmyhome Philippines do the house-hunting for you! We have over 1,000 properties nationwide available for your perusal in our online portal. This massive listing comes from our efforts in partnering with over 200 of the country’s top real estate developers. Instead of going through individual developer websites to get the latest prices and available units, Ohmyome has everything you need in one simple, easy-to-navigate platform. 

Ohmyhome also knows that many homebuyers need to dispose of their earlier investments in order to raise capital. You’ll be happy to know that apart from selling properties, we are also in the business of finding buyers for our customers’ idle properties. With our extensive network, we can find you an outright buyer or get tenants to rent out your spaces.

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