Should I sell?

Client: "...I purchased a property in [Location] for PHP 30 million in 2018. Someone is interested in buying it for PHP 42.75 million. Do you think that's a good deal, or should I hold onto it? It's a corner lot about 80 meters from [Landmark/Location].

JPRE: Interesting question :-)

I recommend to sell it for the following reasons:

1.⁠ ⁠Although zonal values will be revised in 4Q2024/1Q2025 (which would mean higher selling prices in general), it will take some time for the market to accept these higher prices.

2.⁠ ⁠You've earned approx. 6% annually between 2018 and today.

The trajectory of capital appreciation is that it's going to be slower in the next 3-5 years due to the oversupply of those types of properties. In other words, if you continue to hold, that 6% will become smaller. There are other investments that could provide better returns (e.g., Government Bond) and better liquidity.

3.⁠ ⁠The main driver for capital appreciation in [Location] is the Makati subway which has been scrapped.

[The answer provided was partly based on the client's age and investment objectives.]