Metro Manila’s condominium market posted its strongest quarter so far in 3Q 2026, a notable result given the pressure households faced from inflation, rising oil prices, higher policy rates, and geopolitical tensions. Developer and government efforts have worked together to close the gap between what homes cost and what people can afford, and that support has become the market’s main driver.

It now shapes nearly every corner of the market, from how quickly unsold units are cleared to the returns investors can expect, which raises the question at the heart of this quarter: can today’s momentum carry over to the next quarters?

Condo sales rose 17%, led by ready-for-occupancy units

Take-up reached 8,454 units in 3Q, up from 7,255 units in 2Q and about 7,700 units in 1Q.

Most of the growth came from RFO units, meaning finished units that buyers can move into right away. RFO sales rose 89% year-on-year. Pre-selling units, which are sold before construction is finished, went the other way, with sales down 26%.

Developers are offering their best deals on RFO units to clear completed stock, and buyers get a home they can live in or rent out immediately.

Unsold inventory eased, and supply fell to 28 months

Unsold inventory fell to 80,000 units across 639 buildings still selling units directly from developers. That is down from the record 82,900 units in 2Q. Two things helped: stronger sales and fewer new launches.

Months of supply measures how long it would take to sell all unsold units at the current sales pace. It dropped to 28 months from 34 months last quarter, the lowest level in two years. That is real progress, but inventory is still well above manageable levels.

Most unsold units sit in two price segments: Upper Middle (PHP 4M to PHP 7M) and Upscale (PHP 7M to PHP 12M). Together, they hold about two-thirds of the stock.

Developers held back on new launches

New launches fell 39%, from 2,586 units in 2Q to 1,574 units in 3Q. About 90% of the units launched in 3Q were in the Upscale segment.

Developers are focused on selling what they have already built rather than adding more supply.

Discounts and cheaper loans are helping buyers afford a home

Developers are working hard to move stock, especially finished units. In 3Q, RFO buyers were offered:

Downpayment terms of up to 60 months
Deferred payments of up to 120 months
Cash discounts of up to 60%

Pre-selling projects offered downpayment terms of up to 72 months and discounts of up to 50%. The deals are more generous on RFO units because that is where developers most want to cut inventory. With discounts this deep, this is a buyer's market.

The government is also stepping in. Under new Pag-IBIG loan terms, economic and open-market buyers can borrow PHP 2.5M to PHP 4.9M at 4.5%, fixed for three years, down from previous rates of 5.75% to 6.25%. Pag-IBIG also raised its maximum loan amount to PHP 10M, from PHP 6M. A proposed government housing program would go further, offering lower interest rates on well-located condo units priced at PHP 3M and below to help absorb excess inventory.

Buyers have responded well. These measures appear to be closing part of the gap between what homes cost and what buyers can afford or borrow. How long they can keep demand at this level is less certain.

Rents stayed soft, and yields stayed flat

With plenty of rental units on the market, condo rents barely moved in 3Q:

BGC: PHP 1,116 per sqm, up 1% from 2Q
Makati: PHP 889 per sqm, up 0.2%
Bay Area/Pasay: PHP 703 per sqm, down 0.5%

The Bay Area/Pasay has taken the biggest hit over time. Its rents are down 14% from a year ago and nearly 59% below pre-pandemic levels.

Rental yield is the yearly rent a unit earns as a percentage of its price. For new units bought from developers, gross yields range from 3.4% to 4.7%, held down by prices that remain high. The upside lies in how you buy. Investors who pay in cash and secure developer discounts can lift their yields to as much as 5.1%.

Growth is slowing outside Metro Manila

South of Manila, Cavite and Laguna have 7,900 lots in select master-planned townships, of which 80% are sold. Buyers have taken 600 more lots than a year ago. But with plenty of supply, prices are under pressure. Laguna eased to PHP 56,000 per sqm from PHP 58,000, while Cavite rose 2% to PHP 62,000.

North of Manila, lots in Bulacan and Pampanga are 91% sold, with only 90 unsold lots left. Average prices softened after a higher-priced project sold out. Bulacan slipped to PHP 42,000 per sqm from PHP 44,000, and Pampanga held steady at PHP 40,000. Upcoming roads, railways and the New Manila International Airport support the area's long-term growth.

Industry insight

"Developers and government programs are helping bridge affordability and financing gaps that have historically prevented some buyers from entering the market. While these efforts are supporting transactions and helping move inventory, we expect buyers to remain selective and focused on value, quality, financing flexibility, and capital preservation. The challenge for the market is whether current demand levels can be sustained as economic and geopolitical uncertainties continue to influence purchasing decisions." — Sharon Joy Roset-Saclolo, our Associate Director and Head of Research

Market outlook: what to watch in 4Q 2026

The residential market has held up better than expected. But this is not yet a return to strong growth. Much of this year's improvement comes from deliberate efforts by developers and the government to make homes more affordable and easier to finance.

The key question is how long that support can last. Several headwinds remain:

Affordability, with prices still high relative to incomes
High inventory, still at 28 months supply
Low rental yields
Inflation and higher financing costs
Ongoing political uncertainty

Buyers are expected to stay selective, looking for value, quality, flexible financing and ways to protect their capital. For now, the market works in their favor, with deep discounts and long payment terms widely available.

We remain cautious about whether demand can hold at current levels without continued developer incentives and housing finance support.

Whether you’re buying, investing or developing, see where Metro Manila’s condo market is heading in the full 3Q 2026 Philippine Property Market Report at leechiu.com/market-insights.