3Q2022 Philippine Real Estate Outlook

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3Q2022
in Numbers
The third quarter of 2022 was marked by an uptick
in consumer activities as face-to-face classes
reopened, mask-wearing guidelines loosened, and
leisure activities resumed. However, a
continuous rise in interest rates and building
costs may breed caution among investors
considering potential delays in project
developments and impacts on mortgage
rates. Lamudi looks into property search and
demographic activity in the third quarter of
2022 to identify new trends in the online
buying, selling and renting market.
Lead Growth by Property Type
Leads for lots in Visayas and Mindanao
increased by 22 and 10 respectively. Source
Lamudi.com.ph
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3Q2022 IN NUMBERS
Lead Growth by Price Range
The economic segment had the highest growth in
demand out of all other price segments in
3Q2022. Properties priced below Php 450K
sustained the most significant increase in demand
out of all other price segments for properties
for sale as leads increased by 12.
Rental properties priced Php 200K - 500K
continued to attract leads over the last year and
quarter. This may have been influenced by growth
in the commercial sector as firms consider
alternate offices amid changes in work
arrangements and office space requirements.
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3Q2022 IN NUMBERS
Property Supply by Price Range
Rental supply continued to increase across most
price segments. There were fewer listings
priced below Php 5K uploaded in 3Q2022, though
listings in this price range represent a smaller
share of supply composed of short- term rental
units.
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3Q2022 IN NUMBERS
Most Searched Locations by Island Group Property
seekers showed strong demand for regional
administrative centers, with Quezon City, Baguio,
Cebu City, and Davao City being the most
searched locations in each of their respective
island groups.
Amenities
Air conditioning was the most searched
amenity. Ventilation and cooling amenities such
as air conditioning and balcony were among the
top ten most selected amenities on Lamudi in
3Q2022. With average humidity levels peaking in
September, cooling amenities contributed to 19
of all amenity searches. Source Lamudi.com.ph
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Quarterly Real Estate News Round-up
Stay up to date on new normal developments,
affordable housing, infrastructure, local
development, industries, and climate-related
news that happened this quarter.
RETURN TO NORMAL
The Outlook Awards 2022 Gives Tribute to
Pandemic-driven Initiatives of the Real Estate
Industry The real estate industry faced various
challenges and trials because of the Covid-19
crisis. Faced with different ordeals, developers
bounced back stronger and better for the future
of the industry. The Outlook 2022 Philip pine
Real Estate Awards featured pandemic-related
citations to recognize developers who excelled
in catering to the needs of sellers, property
seekers, and organization.
Resumption of Face-to-Face Classes Pushes PH
Economy into Full Recovery On August 22, 2022,
face-to-face classes (F2F) in the Philippines
finally resumed, contributing to the revival of
the economy. Most public schools were mandated
to have five-day in-person classes, and those
with blended learning programs will have F2F
classes three times a week. The government sees
the school reopening as a win for Filipinos,
considering that school zones also serve as
economic hubs. Revenge Travel Fuels Recovery of
Hospitality Real Estate
Retail Sector Vacancy Approaches Pre-COVID
Levels Pent up consumer demand, relaxed mobility
restrictions, and return-to-office initiatives
have spurred activity in the retail real estate
industry, according to advisory firm Santos
Knight Frank. Vacancy rates were at 4.6 as of
2Q2022 - nearing the pre-pandemic level of 3.6
according to Santos Knight Frank Investment
Capital Markets director Kash B. Salvador in an
article by BusinessWorld.
Hotel occupancy in Metro Manila improved and
reached 47 percent in the first half of 2022. The
positive development is attributed to the
resumption of business travel, a huge volume of
foreign arrivals, and local travelers readiness
to spend. Tourism-related trends also influence
home
preferences, with quiet places of residence
transitioning to personal vacation destinations.
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QUARTERLY REAL ESTATE NEWS ROUND-UP
AFFORDABLE HOUSING SECTOR
One of the events keynote speakers and the
National President of the Organization of
Socialized and Economic Housing Developers of
the Philippines, Inc. (OSHDP), Gino Olivares,
cited co-buying and micro-ap artments as trends
that could mitigate the production backlog. The
whole- day conference also tackled the viability
of modular construction in balancing the
affordability and quality of houses. DHSUD to
Address Housing Backlog with In-City Housing The
Department of Human Settlements and Urban
Development (DHSUD) announced that it would
develop in-city housing projects to fill the
country's housing gap. Roughly half of the
country's backlog is attributed to informal
settler families, whose livelihood concerns the
projects aim to address. DHSUD aims to provide
settlements near their workplaces. INFRASTRUCTURE

PIDS Recommends Tax Measures to Curb Land Price
Increases The latest study from the Philippine
Institute for Development Studies (PIDS)
outlined different policy recommendations to
make housing more affordable and accessible. The
research agency said that an equitable property
valuation system and the idle land tax
collection program can help curb land price
increases and contribute to solving the
affordable housing crisis.
SHDA Appeals for a Price Cap Hike on Socialized
Housing With the increase in price ceiling for
economic housing, the Subdivision and Housing
Developers Association (SHDA) hopes that the
government will likewise apply changes to
socialized housing prices. The group said that
the rise in construction costs should be a
consideration in the price cap increase. The
increase in economic housing price ceiling was
introduced in June before the new administration
stepped in. From Php 1.7 million, its now at Php
2.5 million.
DPWH Unveils PPP Priority Projects The Department
of Public Works and Highways (DPWH) identified
priority projects under public- private
partnerships. The majority of the
The Outlook Conference Underscores the Need for
Better, More Affordable Housing The affordable
housing problem and potential solutions gained a
spotlight in Lamudis The Outlook 2022
Philippine Real Estate Conference.
developments are expressways, including Metro
Cebu Expressway and Central Luzon Link
Expressway. All in all, 10 projects were unveiled.
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QUARTERLY REAL ESTATE NEWS ROUND-UP
BOT Law IRR Amendments to Lure Private Sector
INDUSTRY DEVELOPMENTS
According to the National Economic and
Development Authority (NEDA), updates in the
Build Operate Transfer (BOT) Laws Implementing
Rules and Regulations (IRR) would encourage more
private sector participation in public
infrastructure projects. One notable change is
the definition of the Material Adverse
Government Action (MAGA), which terminates the
contract and pays the private proponent should
government actions discriminate against the
proponent and negatively affect their ability to
do the project. This previously covered only the
executive branch, but now includes the
legislative and judicial branches as well as
local government units (LGUs) and line
agencies. DENR Launches Cold Chain Innovation Hub
in Taguig The Department of Environment and Natur
al
Resources (DENR) opened the Cold Chain
Innovation Hub (CCIH), a cold chain technology
transfer center, at the Technical Education and
Skills Development Authority (TESDA) Complex in
Taguig City last September. The hub is a one-stop
shop center for innovation and capacity-building
aimed at promoting the use of low-carbon, energy
efficient refrigeration technology in the food
cold chain industry. DTI to Open AI Research
Center Last September, the Department of Trade
and Industry (DTI) signed a partnership with
UnionBank of the Philippines and Global Learning
Solutions for the establishment of the Center
for Artificial Intelligence Research (CAIR) and
Industry 4.0 Pilot Factory (I4PF). The latter
will be a hub for collaborative AI research and
development, while I4PF will host learning
laboratories for technologies such as robotics
and intelligent manufacturing. The project
aligns with DTI objectives to promote digital
transformation, enhance productivity, and upskill
workers.
San Miguel Wins Original Proponent Status of
Cavite-Batangas Expressway Project The Provincial
Government of Cavite accepted San
Miguel Corporation's unsolicited proposal to
develop, design, finance, construct and maintain
the Cavite-Batangas Expressway. The toll road
will span 27 kilometers, starting in Silang,
Cavite and ending in Nasugbu, Batangas. National
Infrastructure Program Bill Filed at Senate
Last July 2022, a bill proposing a thirty year
planning horizon and establishment of a National
Infrastructure Program was filed at the Senate.
The bill is centered on the identification
process for government core infrastructure
projects. Passage of the law would require the
government to complete identified projects in
the pipeline.
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QUARTERLY REAL ESTATE NEWS ROUND-UP
Climate Emergency Declared in Makati Makati has de
clared climate emergency and
BSP Introduces Cashless Payment Initiative
Paleng-QR Ph The Bangko Sentral ng Pilipinas
launched Paleng- QR Ph in Baguio, a program that
aims to popularize digital payments. Market
vendors and tricycle drivers are said to benefit
from the initiative, as it can provide access to
different financial services. The program is
implemented in partnership with the Department
of Interior and Local Government (DILG).
appealed to businesses, communities, and
stakeholders to join the movement in combatting
climate change. The local government bared its
green initiatives, which involve a green, smart
transportation system. In 2024, the city will
deploy around 30 to 50 electric buses in the
city.
RE Firm Altenergy to File IPO Renewable energy
(RE) firm Altenergy announced plans to raise a
PHP 2.18 billion initial public offering in
November. The firm aims to develop up to 1,254
megawatts of additional RE projects in the next
five years. Altenergy was founded by former
Department of Energy Chief Vicente Perez Jr., and
was involved in projects such as the Bangui Bay
Wind Farm, Pililla Wind Farm and Tanay Wind
Power Project.
DA, JICA to Implement Vegetable Value Chain
Project The Department of Agriculture (DA) and
the Japan International Cooperation Agency (JICA)
are
partnering for the Market-Driven Enhancement of
Vegetable Value Chain (MV2C), a technical
cooperation project with goals to achieve higher
yield and income for farmers and achieve food
security. The five-year project includes the
development of innovative solutions to promote
efficiency in the value chain and a value chain
roadmap.
PH, France to Increase Agri, Climate Change
Cooperation The Philippines and France expressed
interest in expanding development cooperation in
areas such as agriculture and climate change
during a meeting between Finance Secretary
Benjamin Diokno and French Ambassador to the
Philippines Michèle Boccoz last August. Avenues
for partnership discussed include biodiversity,
green energy, waste management, and French
private sector investment through PPPs.
CLIMATE SUSTAINABILITY
NEDA Develops Sustainability Action Plan NEDA
plans to launch the Philippine Action Plan for
Sustainable Consumption and Production. The
action plan involves impact measurement and
evaluation of all sectors as well as a policy
agenda promoting responsible consumption and
production patterns, and alignment with related
measures pushed.
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This section focuses on economic indicators
influencing the affordable housing market. In
2021, the House of Representatives declared a
national housing crisis. Rapid population growth
and increased internal migration set amid rising
costs of land had continued to drive a growth in
informal settler families (ISFs). With an
estimated six million housing units needed this
year and private and public construction output
over the preceding five years at under eight
hundred thousand units, the already large
housing gap continues to widen. In this section,
Lamudi looks at economic indicators that have
driven market movements and delays for
properties priced below Php 3M.
ECONOMIC SECTOR DEMAND PERSISTS
Property inquiries on Lamudi are concentrated in
the economic sector. In 3Q2022, two out of every
five leads were for Lamudi listings priced
below Php 3M. Properties priced between Php 1.5M
and Php 3M alone attracted nearly a fifth of
all leads on the platform. Properties priced
below Php 3M represented the smallest share of
listings on the website leaving opportunity to
fill supply in the more affordable segments.
THE OUTLOOK QUARTERLY A WRAP-UP OF THE
PHILIPPINE HOUSING MARKET IN 3Q2022 10
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BRIDGING THE GAP IN AFFORDABLE HOUSING
HIGHER CONSTRUCTION COSTS
One deterrent from producing more affordable
housing options is the increasing cost to build.
The cost of construction materials in the
wholesale market increased consistently from
August 2021 to August 2022, according to the
Philippine Statistics Authority. Prices in August
were 7 higher than the previous year, and 33
higher than costs in the base year of
2012. Other than the growing costs of
construction materials, the cost of transporting
them has also grown more expensive. Travel
restrictions during the pandemic had slowed down
the movement of construction commodities and
caused delays in project development over the
last three years. In 2022, the weakening of the
Philippine peso against the US dollar as well as
higher oil gas prices have made the purchase,
importation and delivery of construction
materials significantly more expensive. Boutique
developers and those without in-house
construction teams may have to transfer the cost
burden to the customer or downsize operations in
order to carry out the project.
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BRIDGING THE GAP IN AFFORDABLE HOUSING
RISING RESIDENTIAL REAL ESTATE PRICES
With limited buildable land available, land
values have skyrocketed in urban centers. This
makes it less cost-effective for real estate
developers operating at the heart of business
districts to offset capital expenditures and
cater to more affordable housing markets.
Market values have also risen. Residential real
estate prices continued to increase in 2022, with
price indices for the first and second quarters
of the year being much higher than the average
price indices from years 2018 to 2020.
Residential real estate prices in 2Q2022 were 42
higher than in the base year of 2014 and 12
higher than the pre-pandemic (2019) average.
Prices in residential properties for sale
continue to grow more costly.
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Facilitating access between Southern Luzon and
Metro Manila, CALABARZON is a strategic location
for industrial real estate investors as well as
a prime residential real estate destination for
suburban developments. In this section, Lamudi
provides supply and demand trends for listings in
Region IV-A, composed of Cavite, Laguna,
Batangas, Rizal and Quezon (CALABARZON).
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REGION IN FOCUS CALABARZON
Commercial properties contribute the most rental
supply out of all other properties for lease in
the region.
With over sixty industrial estates and economic
zones (ecozones), CALABARZON is one of the
country's prime industrial hubs. Its vast lands
for agribusiness as well as access to major
thoroughfares in Southern Luzon and Metro Manila
make the region a key location in both regional
and international supply chains. The region
hosts a strong market for storages given the
many factories and processing facilities in the
area. Over half of all leads for commercial
rentals in the region on Lamudi in 3Q2022 were
for warehouses.
Leads for properties are spread across each
province, but Antipolo attracted the largest
share of leads in 3Q2022
Source Lamudi.com.ph
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REGION IN FOCUS CALABARZON
The bulk of leads for properties in Cavite were
from seekers in Cavite and southern parts of
Metro Manila. In terms of demand, Tagaytay and
Bacoor attracted the most leads.
The leisure town of Tagaytay represented roughly
20 of all leads for properties in Cavite, a
fifth of which is for properties for sale priced
between Php 6M and Php 9M. Rentals in Cavite were
mostly composed of houses and commercial
listings, with house lot listings, townhouses
and warehouses attracting the most leads. Silang
boasted the largest rental supply in the province
on Lamudi in 3Q2022.
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REGION IN FOCUS CALABARZON
Industrial hubs Sta. Rosa and Calamba attracted
majority of leads in Laguna.
Laguna's industrial parks, access to schools, and
growing residential real estate market make it an
extremely attractive location for those looking
to live in suburban residential communities.
Seekers from Metro Manila and other parts of
CALABARZON contributed significant shares of
leads to properties in Laguna. Transport
services such as p oint-to-point bus routes allow
Calamba and Sta. Rosa residents direct access to
Metro Manila, and vice versa.
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REGION IN FOCUS CALABARZON
Lipa attracted nearly a third of all leads for
properties in Batangas. Majority of leads came
from CALABA and Metro Manila.
There were significant concentrations of leads in
the primarily urban areas of Batangas, such as
Lipa and Batangas City. Batangas is one of the
country's most rapidly urbanizing provinces, with
major shopping centers, schools, leisure estates
and an emerging business process outsourcing
(BPO) industry.
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REGION IN FOCUS CALABARZON
Demand for properties in Rizal were most
concentrated in Antipolo and Cainta in 3Q2022.
Antipolo and Cainta composed over half of all
leads for listings in Rizal. Leads for the two
cities were most concentrated in listings priced
between Php 1.5M and Php 4.5M, and were mostly
for horizontal residential properties. Nearly
70 of inquiries for properties in Antipolo and
Cainta were from seekers aged between 25 and
54. Amenity searches for seekers from Antipolo
in particular were heavily centered around cars.
Terms such as garage, car port, and parking
contributed to over 20 of their amenity searches.
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REGION IN FOCUS CALABARZON
Leads were spread across different cities in
Quezon Province but were most concentrated in
Lucena.
While leads were fairly distributed across Quezon
Province, the capital city of Lucena held the
highest concentration of leads in 3Q2022. Lucena
was also the third-highest source of leads for
Quezon Province during the third quarter of
2022. The top ten most searched amenities by
seekers in Lucena included spaces such as a
study room and entertainment roompointing to
significant demand from a younger property
seeker market in Lucena. While pageviews from
Lucena were sourced across different price
segments, leads from Lucena-based seekers on
Lamudi were split between those aged 18 to 24
and 25 to 34.
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REGION IN FOCUS CALABARZON
Leads are most concentrated within the low-cost
segment, while supply is most concentrated
within the luxury segment.
In 3Q2022, roughly two thirds of all leads for
properties in CALABARZON were for listings priced
below Php 6M. Listings priced between Php 450K
and Php 4.5M attracted the highest shares of
leads in CALABARZON. Listings within this price
segment were primarily composed of houses and
land for sale. The most searched sub-categories
for house and land properties within this segment
were residential lots, house lots, townhouses,
and agricultural lots in that order. Supply in
the Php 6M and up segment were also mostly
composed of houses and land for sale. Leads for
horizontal properties within this price range
were primarily for house lots and residential
lots followed by agricultural lots, commercial
lots and beach lots. Investment opportunities for
property seekers looking into the commercial and
residential-leisure real estate abounds in the
region.
THE OUTLOOK QUARTERLY A WRAP-UP OF THE
PHILIPPINE HOUSING MARKET IN 3Q2022 20
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