By Beatriz Marie D. Cruz, reporter
residential vacancy in According to , Metro Manila is expected to see a sustained decline through 2027 due to renewed demand for middle-income condominiums. Real Estate Consultancy Firm ColonelLear Philippines.
In its third quarter property market report, Colliers expects the residential vacancy rate to reach 26.5% this year, before falling to 26% in 2026 and 24.9% in 2027.
“What stands out is that the middle-income residential segment continues to perform well,” Colliers Philippines director and head of research Joey Roi H. Bondoc said in a briefing on Wednesday.
“Hopefully, we will see more growth in affordable, lower middle income and upper middle income condominium units by the end of this year, the fourth quarter and into 2026,” he said.
In the third quarter, residential acquisitions grew 108% to 5,900 units from 2,800 units in the second quarter. This was the highest in nine quarters or since 8,500 units in the second quarter of 2023.
“When you look at the take-up for the first nine months of 2025, more than 90% of these projects are coming in the affordable to middle-income segment,” Mr Bondoc said. He said these units usually cost between P2.5 million and P12 million.
Backout rates, where buyers cancel their purchases, fell 26% to 2,700 units in the third quarter from 3,600 units in the second quarter. This resulted in a decline in backouts for two consecutive quarters.
Mr. Bondoc said the improved residential vacancy rate could also be attributed to the lower completions in Metro Manila.
“We call it developers who turn off the supply tap and really recalibrate and systematically meet what the market needs at this point,” he said.
Colliers data showed that residential completions between 2026 and 2028 will average just 3,600 units, down 87% from the average of 13,000 units completed from 2017 to 2019.
“If you have limited supply right now, you have stable or increasing demand,” Mr. Bondoc said. “Combining those two factors, we are projecting very low vacancy going forward.”
Colliers noted that the residential vacancy rate is expected to increase to 26.5% by the end of 2025 due to additional units scheduled for turnover by the end of the year in the Bay Area, Alabang and Makati Central Business Districts, up from 25% in the third quarter.
By submarket, the Bay Area is projected to have the highest residential vacancy at 58.6% by the end of 2025, followed by Fort Bonifacio (20.2%) and Makati Central Business District (13.2%).
As of the third quarter, about 30,400 units remained unsold in Metro Manila.
Of the total, 47% of the unsold inventory in Metro Manila comes from the middle-income group, falling from the 59% share of middle-income condominiums to the unsold inventory in 2024.
Colliers said 35% of unsold units come from the affordable segment, priced from P2.5 million to P3.19 million, 35% from the lower middle income (P3.2 million to P6.99 million), and 12% from the upper middle income segment (P7 million to P11.99 million).
Mr Bondoc said promos for ready-for-occupancy (RFO) units were attracting buyers, leading to a recovery in residential purchases.
“This just goes to show that the ready-for-occupancy promos being offered by developers right now, which continue to be in abundance, are really doing wonders for the residential sector here in Metro Manila,” he said.
In previous quarters, Colliers said developers have offered attractive promos for RFO units, including spot cash payments, free parking and up to 60% discount for rent-to-own promos.
Mr Bondoc said developers need to be creative in their RFO promos to keep up with buyer demand.
