8 Data-Driven Discoveries in Leechiu's Q2 2024 Report on Manila Real Estate: What "Clearer Skies Ahead" Means for You

July 3, 2025

The Metro Manila real estate market is a dynamic, ever-evolving landscape. For investors, developers, and potential homeowners, staying abreast of the latest trends isn't just helpful – it's crucial. Thankfully, Leechiu Property Consultants (LPC) consistently delivers invaluable insights. Their Q2 2024 report, aptly titled "Clearer Skies Ahead," provides a comprehensive, data-driven analysis that sheds light on key shifts and enduring strengths.

Let's dive into 8 significant discoveries from this vital report, exploring what they mean for the future of Philippine real estate.

1. Office Sector Resurgence: Strong Half-Year Performance Signals Recovery

One of the most encouraging findings from the Leechiu Q2 2024 report is the robust comeback of the office market. The first half of 2024 saw a remarkable 24% year-on-year increase in office space demand, reaching a substantial 685,000 square meters. This surge wasn't fueled by a single factor but a combination of forces. The ever-expanding Information Technology-Business Process Management (IT-BPM) sector continued its growth trajectory, driving significant leasing activity. Alongside this, traditional corporate occupiers showed renewed confidence, expanding their footprints. Interestingly, a notable uptick in government agency leasing also contributed to this impressive performance. This data strongly suggests a sustained return to office-based work for many industries and a clear, growing demand for well-located commercial spaces across Metro Manila.

2. Improving Office Vacancy Rates: A More Balanced Market Emerges

Hand-in-hand with the increased demand, the overall office vacancy rate in Metro Manila saw a welcome 1% decline, settling at 17% in Q2 2024. While new supply did enter the market – approximately 125,000 square meters – the impact on vacancy was minimized due to strong pre-commitments. This meant only about 98,000 square meters truly became unoccupied. What does this signify? A healthy absorption of new inventory and a more balanced market where landlords are finding it easier to fill spaces. This trend is positive for property owners and indicates a stabilization in the commercial real estate segment.

3. Makati and Taguig Continue to Lead Office Demand: Prime Locations Reign Supreme

It comes as no surprise that prime business districts remain at the forefront of office space demand. Makati City and Bonifacio Global City (BGC) in Taguig continue to be pivotal hubs. Makati boasts the highest supply of office spaces, with BGC following closely. Their enduring appeal lies in their strategic locations, established infrastructure, and access to a vast talent pool. Consistent rental income and strong appreciation potential in these areas underscore their status as top-tier investment destinations within the Philippine property market. Businesses prioritize these locations for their prestige, connectivity, and access to a highly skilled workforce, ensuring their continued dominance.

4. Shifting Residential Demand: From Condos to Landed Homes

A fascinating shift highlighted in the Leechiu report is the evolving preference within the residential sector. There's a noticeable increase in demand for landed houses and lot packages, especially in areas with excellent access to highway infrastructure and along major expressways. This trend, likely solidified during the pandemic as people sought more space and less urban congestion, suggests a continued suburbanization effect. Buyers are prioritizing larger living spaces, greener environments, and potentially more affordable options outside the immediate bustling core of Metro Manila. This indicates a key opportunity for property developers focusing on master-planned communities in emerging growth centers.

5. Residential Condominiums Face Headwinds: A Cautious Outlook

Conversely, the residential condominium segment is experiencing some challenges. The report indicates that high interest rates are playing a significant role, making mortgage financing more expensive for potential buyers. Furthermore, competition from alternative investments, particularly those found in the emerging townships outside Metro Manila, is impacting buyer sentiment and condo take-up rates. As a result, real estate developers are expected to adopt a more cautious approach to new condominium project launches in the coming year. This doesn't mean the condo market is collapsing, but rather that it's entering a period of adjustment where developers will need to be strategic with their offerings.

6. High-End Residential Properties Defy Trends: Luxury Market Thrives

Despite the broader difficulties faced by the general residential market, the luxury real estate segment continues to perform exceptionally well. The Leechiu Q2 2024 report highlights that high-end residential properties, especially in exclusive enclaves like Forbes Park, have shown consistent and robust appreciation. Values in these premier locations have increased by up to 15%, even amidst recent economic uncertainties. This segment remains highly attractive to high-net-worth individuals, with some transactions reaching multi-million dollar figures. The resilience of the luxury property market in the Philippines underscores its status as a strong store of value and a preferred asset class for the affluent.

7. POGO Impact on Residential and Office Markets Remains a Factor

The ongoing exit of Philippine Offshore Gaming Operators (POGOs) continues to exert influence on specific sub-markets, particularly in the Bay Area. While overall office demand has rebounded, this former POGO stronghold is experiencing a softening of residential property prices. The report suggests that residential units in the Bay Area may be sold at a "discount" as more POGOs completely vacate their premises. This poses a challenge for landlords in that specific locale, requiring them to adapt to a changing tenant landscape. This illustrates the importance of understanding localized market dynamics within Metro Manila real estate.

8. Economic Fundamentals Drive Long-Term Optimism: "Clearer Skies Ahead" Indeed

Despite the nuanced findings and localized challenges, Leechiu Property Consultants maintain a strong sense of optimism for the long-term outlook of the Philippine real estate market. This confidence is rooted in the country's robust economic fundamentals, including a consistently growing population, increasing urbanization, and a burgeoning middle class. These factors are expected to continue driving demand for all types of real estate in the years to come. This underlying strength provides a solid foundation for future growth, ensuring that even as the market navigates short-term adjustments, the overall trajectory remains positive. The "Clearer Skies Ahead" sentiment truly encapsulates the long-term potential of Philippine property investment.

Leechiu's Q2 2024 report offers a comprehensive and data-driven look at the Metro Manila real estate market. By understanding these key discoveries, investors, developers, and aspiring homeowners can make more informed decisions, capitalize on emerging opportunities, and navigate the market with greater confidence.

SOURCE:

https://www.leechiu.com/market-insights