HOW'S THE MARKET? 4/5

Key trends to note:

Demand for properties in prominent villages continues to rise. These properties have to be taken out of the picture to understand the market trend better.

The slowdown in the secondary market affects properties below P100 million, with the steepest declines seen in lots, detached properties, and townhouses.

Average condo prices in the secondary market are decreasing.

The current market slowdown can be attributed to several factors, all pointing to affordability.

The first photo illustrates that second-tier brands in the primary market are now priced comparably to first-tier counterparts in the secondary market. Notably, the second-tier brand is located on the outskirts of the city, while first-tier projects are situated in the heart of the central business district (CBD). This disparity suggests that unless first-tier secondary market brands increase in value, buyers will remain skeptical about the potential upside of pre-selling projects, especially those located on the fringes of the CBD.

Is there evidence that secondary market condo prices will continue to increase?

As highlighted in the previous post, secondary market condo prices in CBDs have started to decline, with an increasing number of properties being sold below their zonal values. The second photo reveals that in the first nine months of 2024, 52% of completed transactions in CBDs were below zonal values. This indicates a growing skepticism among buyers about the higher valuations derived from the Bureau of Internal Revenue's (BIR) appraisals.

Continued in tomorrow's post.