The Philippine residential property market showed signs of cooling in the second quarter of 2025, with prices rising at a slower pace compared to the start of the year, according to the latest data from the Bangko Sentral ng Pilipinas (BSP).
Growth Moderates Nationwide
Residential property prices climbed 7.5% year-on-year in Q2 2025, slightly down from 7.6% in Q1. On a quarter-to-quarter basis, however, prices still advanced 4.2%, reflecting continued demand in certain segments.
Metro Manila Weakens, Provinces Surge
The BSP noted sharp differences between Metro Manila and the rest of the country. Prices in the National Capital Region (NCR) inched up only 2.4% year-on-year, while property values outside NCR (AONCR) surged 11.5%.
Quarter-to-quarter, NCR prices even fell by 3.6%, while AONCR saw a robust 10.5% rise. Analysts said this reflects shifting demand toward more affordable housing and ongoing infrastructure expansion beyond Metro Manila.
Houses Up, Condos Down
By property type, house prices posted the strongest gains at 13.1% year-on-year, led by single-detached units and townhouses outside NCR.
In contrast, condominium prices slipped 0.2% nationwide, with steeper drops recorded in Metro Manila. Market observers point to oversupply in certain city districts and changing buyer preferences for larger living spaces.
Lending Activity Picks Up
Despite price moderation, the number of residential real-estate loans granted grew 14.7% year-on-year in Q2. Loans for both houses and condominiums increased, with AONCR leading growth at 16.6% compared to NCR’s 10.3%.
The BSP said this suggests resilient demand for housing, supported by borrowers’ access to credit even as interest rates remain elevated.
Median Prices Reflect Divide
The national median home price stood at around ₱3.4 million, but affordability remains uneven. Houses in NCR averaged more than ₱7 million, while properties outside the capital region were significantly cheaper.
Outlook
Analysts see the slowdown as a natural correction in Metro Manila’s overheated market, while demand in provincial areas is expected to remain strong. Developers are likely to continue shifting projects outside NCR, where infrastructure development and lower land costs attract both homebuyers and investors.
As the BSP continues to monitor lending activity and property trends, the real estate market’s performance in the coming quarters will be closely tied to broader economic conditions, household incomes, and interest rate movements.
Sources: BSP, BusinessWorld
