LUXURY condominium launches outside Metro Manila will be more pronounced this year, according to a top official of Colliers Philippines.
Joey Roi Bondoc, director for research at Colliers Philippines, said they’ve been seeing this trend not only happening in Metro Manila but also outside of the capital with some of the most expensive projects located in master-planned developments in Pampanga, Bulacan, Cebu, Davao, Bacolod, and Iloilo, with condominium prices ranging from P185,000 to P262,000 (US$3,400 to $4,800) per square meter (sq.m.)
This is due to the growing acceptance of condominium living coupled with the rising purchasing power of investors and end-users. Buyers of luxury projects also gravitate towards residential developments near public infrastructure projects.
“Colliers projects the attractiveness of luxury and ultra-luxury residential projects sustaining pace and we see this trend even outside of Metro Manila. Offering luxury condominium units in key areas outside of the capital region will be more pronounced beyond 2023 and we see an aggressive differentiation among property firms’ projects moving forward,” said Bondoc.
“This differentiation strategy will extend beyond the usual offering of upscale amenities, topnotch concierge services, and green/sustainable features. Developers should be on the lookout for areas ripe for luxury developments. Securing first-mover advantage will be crucial,” he added.
Bondoc said high-end condominium properties are a viable hedge against inflation.
“We saw this over the past financial crises,” said Bondoc. “These segments will likely remain resilient despite high-interest rates as demand for luxury units is heavily supported by affluent investors upgrading for their end-use.”
A week ago, Robinsons Land Corp. Residences unveiled its luxury condominium project called Mantawi Residences with condo prices from P15 million to P60 million. The project boasts of 1.3 hectares of open space.
Condo inventory in Cebu
In 2022, Colliers recorded the take-up of 6,900 condominium units in Cebu, with upscale to luxury projects (P6 million and above) accounting for about 20 percent of the total take-up during the year.
Bondoc said demand for these projects will partly be sustained by the recovery of tourism which should propel the renewed interest in leisure-oriented properties.
Recently launched leisure-oriented projects in Cebu include Robinsons Land’s fourth tower of Amisa condominium. The residential tower is now 75 percent sold after its launch in May 2022. Another notable luxury condominium project launched in 2022 is Alveo Land’s Cerule, the fifth and final tower of Solinea located in Cebu Business Park. The project has an average total contract price of P8.9 million ($161,700) per unit and an average price per sq.m. of P216,200 ($3,900).
Buyer preferences
According to Colliers’ data, 64 percent of buyers consider location as an important factor when buying condo units followed by the attractiveness of payment terms at 14 percent; developer’s track record at 11 percent; mortgage rates at eight percent; and amenities at two percent.
Moreover, 83 percent of respondents prefer condominium projects that offer good ventilation as well as green and open spaces, while 16 percent prefer having a smart home system. Colliers believes that developers should consider incorporating amenities that will allow residents to work from home such as co-working spaces, function rooms, and business lounges.
“Adopting green and sustainable features will play an important role in enticing consumers to invest in a condominium project and cornering demand from affluent and discerning markets outside of Metro Manila,” Bondoc said.
Infrastructure boosts demand
Government infrastructure projects are also expected to unlock land values, raise property prices, and spur economic activity in the countryside.
According to the National Economic Development Authority, the government has lined up 3,700 infrastructure projects worth P15 trillion ($272 billion) until 2028. These projects are widely anticipated by property developers.
“The completion of expressways, railways and airports should raise the attractiveness of provinces for integrated communities which should result in the development of more residential condominiums, as well as office towers and leisure projects,” said Bondoc.
Consumer confidence
Meanwhile, according to the Consumer Expectations Survey (CES) released recently by the Bangko Sentral ng Pilipinas, buying intentions across the big-ticket items were mixed in the next 12 months-- less bearish for houses and lots, more pessimistic for consumer durables, and steady for motor vehicles.
The percentage of households that plan to buy/acquire real property within the next 12 months increased slightly to 4.6 percent from 4.1 percent in the fourth quarter of 2022 survey results. This can be attributed to the higher percentage of households that plan to acquire single-detached houses (at 49.7 percent from 33.8 percent), agricultural lots (at 12.1 percent from 7.3 percent), and commercial lots (at 7 percent from 1.4 percent).
When asked about the price range of real properties they intend to purchase in the next 12 months, the majority, or 58.6 percent of the households, indicated a range of P450,000 and below. Meanwhile, 27.1 percent and 14.3 percent of the households plan to buy a house and/or lot worth P450,001 to P1,700,000 and P1,700,001 and above, respectively.
The first quarter CES was conducted from Jan. 19 to 31. Some 5,467 households were surveyed — 2,729 (49.9 percent) were from the National Capital Region (NCR) and 2,738 (50.1 percent) were from areas outside NCR. (KOC)