Real estate developers in the Philippines will still experience difficulties in closing leasing deals for residential condominiums in Metro Manila during 2018, according to a Colliers International Philippines report.
This scenario will take place this year due to the launch of new properties in central business districts and border locations. The consultancy firm mentioned this trend in its Top 10 Predictions For 2018 analysis.
Since the condominium market will be challenging, property companies will look beyond Metro Manila. Their pursuit of new business opportunities will take them to second- and third-tier cities nationwide, particularly in nearby provinces such as Cavite where township developments have become popular.
These projects include Lancaster New City properties. An online review site like Land Price List will help prospective buyers or real estate agents compare prices in these regions, especially since residential property values have become more expensive. The increase in prices indirectly stem from a lack of construction workers, Joey Bondoc, research manager at Colliers International Philippines.
Bondoc said that the private construction industry has been forced to delay some projects in 2017, following the dearth of skilled laborers. Colliers had expected the delivery of new 16,200 residential units between January and September, yet an estimated 7,400 of those were launched into the market.
The lack of construction workers in the country affects not only residential property projects but also infrastructure developments that are planned under a $180 billion Build, Build, Build initiative. For this reason, the government wants overseas Filipinos to come back home and lend their skills. A major obstacle to this involves nearby countries that also plan their building programs, including Japan and Singapore where construction professionals earn higher salaries.
The common investment theme in the Philippines’ residential property sector will focus on regions outside Metro Manila, despite several industry headwinds.