Hidden Risks of Philippine Condos: Crash Ahead? 🇵🇭

Why the Philippine Condo Market Might Be Overvalued—and What It Means for YOU!

In this video, we take a closer look at the Philippine condo market and why it might be overvalued. From rising property prices and shrinking rental yields to high vacancy rates and the impact of recent tax reforms, we’ll break down the risks and potential pitfalls of investing in Philippine condos right now. With foreign demand dropping, vacancy rates increasing, and a market that’s becoming harder to predict, what does this mean for property owners and potential buyers? Plus, we’ll explore how savvy buyers could take advantage of a changing market. Don’t miss out on these crucial insights—watch now!

00:00 - Intro
00:31 - The Reality of Rental Yields—Not as Sweet as They Seem
02:19 - The Mystery of Vacancy Rates—A Hidden Red Flag
04:48 - Condo Prices Keep Rising, but Rental Rates? Not So Much
05:49 - Falling Demand vs. Rising Prices—A Recipe for Trouble?
07:05 - New Tax Reforms—What This Means for Property Owners
08:56 - A Potential Opportunity for Savvy Buyers?
09:38 - Conclusion

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[wilbertuy]

We need more people that analyzes like this in the Phils. Not afraid to burst bubbles

[Jeruandaya]

You are correct. It’s the unregulated greed of the developers is to blame. Before, the preselling properties are cheaper and the secondary properties are expensive. Now it’s the other way around. Secondary properties are cheaper while the preselling properties are much much more expensive and the completion time is longer than before. It’s the developers who’s to blame for this.

[alroberts]

Last week, a realtor from the MNL / Makati / BGC Group Real Estate site posted a listing on a Facebook group featuring hundreds of bank-owned foreclosed properties throughout Metro Manila. This indicates that, with POGO renters gone, many condos are now sitting empty.

I also looked at listings for condos available for rent, and although there were many "For Rent" signs, the asking prices were excessively high. For instance, there was a three-bedroom, three-bath condo for sale in BGC with an asking price of 200 million pesos. The place was bare, with hardly any furniture, and overall, it lacked appeal.

To put that into perspective, 200 million pesos equals approximately $3, 398, 000. In San Francisco, you could buy a condo at that price and enjoy a spectacular view of the Golden Gate Bridge, the ocean, and downtown San Francisco, complete with first-class amenities. I believe that the condo is significantly overpriced. It seems as though they set the price out of thin air, hoping for an easy payday without putting in the effort. It's just too unrealistic.

[LarryfromPH]

This is what I had been thinking all along! PH is still a developing country and most Filipinos aren't earning big enough rent these condos!
Thank you for these developers who are making Metro Manila similar to Hong Kong where the rents are so high and the units are so small.

[merevial]

Fun fact, as a foreigner, I wouldn't even bother renting for 50K a month, wth was the point of me moving to a low cost country to pay the same as a Tokyo apartment?

[rbaker]

Sold my Rockwell and BGC condos two years ago. I already knew then that the yield on my investments was decreasing due to continued over construction of condominium buildings. I already knew a bubble existed then, it just got worse now because of the POGOs’ exit.

The absurd lack of transparency in the Philippine property market borders on Criminal. The Philippine Congress needs to pass laws that improve transparency in such a critical market.

[jeful]

Thank you. Finally someone got this one right. Why would the real estate in the Philippines be so freaking expensive as if the country is a hub for technological, commercial, scientific employment opportunities. It's far from it. Yes, the country is beautiful with all the beaches and the people are friendly but that's all. Economically speaking though real estate is way too expensive.

[leunam]

Keep on building and if the price collapses I will buy.

[andrewdomingo]

Observing the number of condos built and being built versus the financial status of many Filipinos, the first thing that came to my mind was "NO WAY THAT MANY FILIPINOS CAN RENT/BUY THESE UNITS."

Thanks for your explanation.

[ivyteodoro]

Few years ago, I was encouraged to buy a condo in Pasay, Manila. I was not convinced, any real estate is a good investment but not this air space. I rather bought pieces of lands in the province. After 5 years, the property value goes up 5x

[DeborahOlson-rn]

Me and my husband are both retired in the US but getting a condo in the Philippines may not happen as they are too expensive. We might end up constructing a house in the province where I have land that I got from my parent. Buying too expensive properties could limit us to travel in any different places. We are not investing for Airbnb anymore as we are already old. Traveling around the country and around could make our life fulfilling.

[chelsea]

Yup. Just as I predicted years ago.
Buying condos is never a good investment. Not in these times.

[keith]

Key term… artificially inflated… I have seen a couple of condos in Metro Manila and I would consider them…. At one third the asking price.
I don’t think the realtor was prepared for that level of honesty.
The prices do not reflect the product.
Nor does the product reflect the price.

[Lolopinoy]

This is probably the most honest video I’ve seen on Philippine realestate market. Another factor that will force a drop is when AI technology starts affecting Call center employment in the Philippines. This will start happening in the next 2 years

[NiWdLES]

Finally someone talking about this horrendous condo prices.

[coshopnow]

Overseas Filipino Workers is a large group of buyers for Filipino condos, that is why many condo units are vacant. They buy for retirement and as investment. These overseas buyers also is the reason that Philippine condos are of poor quality, as these owners do not monitor the maintenance of their properties, and do not participate in owners associations, allowing developers to keep control of the property admin offices, and milk it for profit. When you see agents offering condo units with no downpayment required, run. The developer behind that mode of selling is also the largest developer in BGC, and if you check the quality of the property admin, you will know what I mean. Maintenance is minimal, and lifts are left to rot. Meanwhile, there is a huge amount of delinquency in the condo's association dues collection, most probably because the developer still owns units in the condo, but does have to pay the dues because they control the property admin office.

[gerardjoaquino]

Excellent points. A correction is in fact overdue. But until these developers still hold out, it's simply become a matter of time as to when.

[RickM]

I migrated to the US in 2009 (I work in health care). Back in 2021, I was planning to invest in real estate (rental property), I checked prices in Manila (San Juan, Mandaluyong, Makati etc). I was surprised that it was actually cheaper to buy here in North California. I ended up buying a 3 bedroom home here (20% down payment) and it was easy to get tenants. Worked out well as the rent pays for the mortgage +extra passive income. I do miss Manila though so me and my wife may still end up retiring back home in Ph so keeping my eyes open if there is a market correction.

[TechBuddy]

i am into real estate.. naging part time agent din ako at buyer.. I just sold my condo just this year, grabe sobrang hirap ebenta. There are a lot of owners selling their unit and too few buyers. I've been telling this to my friends that the condo bubble already begun. Condo prices in Ph per sqm is way expensive than Singapore.

[Denee_Padee]

Before we met, my wife bought a preselling condo in 2012 for herself. We then got married and she moved with me to California. The unit turnover was mid 2014 when she was already here so we rented it out. Being a long-distance landlord is a pain. We used two different rental agents/property managers, and they were basically useless. They did not vet the renters well and really only cared about their commissions. By 2019 we had had enough and decided to sell. We had a really hard really time finding a buyer and it took almost a year to sell. Not a lot of locals can afford a condo, and banks are leery of giving out loans for used units (I don't blame them, my brother-in-law said the quality was horrible and materials used were obviously cheap. Why would they risk their money on something that might not be in sellable condition in a few years). And again, our agent was useless, and we eventually found a buyer ourselves here in Cali. We breathed a huge sigh of relief once that sale closed.