A new wave of interest in new housing in the Philippines is having the opposite effect on the country’s already overheated housing market.
A new report by real estate website Home Depot Philippines estimates that over the past three years, demand for housing in Philippine cities has more than doubled from an average of 8.7 million units per year in 2014 to 11.4 million units in 2020.
And while demand remains high, demand is slowing.
The report says that over half of the country now needs to buy a home.
“We’re getting a little bit worried that demand is going to keep going up, but we’re not seeing a trend change,” said Alex de Leon, CEO of the real estate platform Home Depot.
“The housing market is still very hot.”
Homes are still going for $3.4 trillion in 2020, a number that will likely keep going higher.
In fact, Home Depot says the median price of a house in Manila is expected to increase to $749,000, up from $644,000 in 2019.
De Leon said that the housing bubble in the country is similar to the one that popped in the US in the 1980s and 1990s.
Housing prices rose dramatically and, in the process, many households lost the ability to buy homes.
While many were forced to rent, many also found that they had to find other housing to live in, and were left with fewer and fewer options for housing.
And, while some of the boomers in the Philippine housing market have had to move out of the area, many of those who remain in the region are struggling to make ends meet.
“There’s been a lot of young people that have been forced out, and that’s been the biggest problem for a lot people,” said De Leon.
He added that most of the buyers and sellers have either been looking for cheaper homes or that they’ve lost their jobs.
“It’s not really a question of supply and demand anymore,” he said.
And he said that this new wave is causing an already high price of housing.
“You can look at how much homes are going for right now, you can look around and see how much people are actually paying for it,” he explained.
“People don’t really have the money to buy.”
De Leon believes that a lot more housing will be needed in the coming years.
“If you want to build a new housing market, you have to do a lot to change that supply,” he concluded.
“That’s what we’re trying to do here.
We’re trying make it affordable.”