Residential real estate prices in the Philippines have taken a significant dip, with the nationwide price index falling by 2.3 percent year-on-year (y-o-y) and 1.6 percent quarter-on-quarter (q-o-q) in Q3 2024. This marks the first price contraction since Q3 2021, signaling a potential shift in the real estate market.
Prices in the National Capital Region (NCR) saw a dramatic 14.6 percent drop y-o-y, driven by a decline in duplexes, single-detached homes, and condominiums, while townhouse prices were the only exception. Conversely, Areas Outside the NCR (AONCR) saw a 3.0 percent price increase, primarily due to rising values in single-detached houses and condominiums. On a q-o-q basis, both NCR and AONCR experienced declines in housing prices.
The downturn in property values comes amid a notable drop in housing loan availment. Residential real estate loans (RRELs) contracted by 15.7 percent y-o-y, though a 3.1 percent increase was observed on a q-o-q basis, with an uptick in loan demand for housing in both NCR and AONCR.
The data, compiled by the Bangko Sentral ng Pilipinas (BSP), highlights mixed trends across housing types. Prices for duplex units and condominiums plunged significantly, while prices for single-detached houses and townhouses saw modest growth.
This market contraction reflects broader consumer caution, as indicated by the BSP’s Consumer Expectations Survey, where a growing number of Filipinos expressed a more pessimistic outlook on homeownership. With tightening credit and shifting demand, the real estate market is likely entering a period of stabilization after years of rapid growth.
