Cushman & Wakefield said further interest rate cuts by the Bangko Sentral ng Pilipinas would benefit the real estate market.
Claro Cordero Jr., director and head of research at the global commercial real estate services firm, said that while current mortgage rates remain high, opportunities could emerge as they are expected to gradually fall in line with adjustments to short-term interest rates influenced by policy changes.
“This shift could create favorable conditions for households planning residential purchases. The Bangko Sentral ng Pilipinas’ anticipated moves to further stabilize the economic landscape pave the way for improved market confidence, despite potential constraints on demand from remittance-reliant households,” Cushman & Wakefield said in a report.
Capital Economics, an independent economic think tank, forecast average inflation of 3.2 percent this year, 2.9 percent in 2026 and 3 percent in 2027, all within the government’s 2 percent to 4 percent target range.
Much of this stable growth is also attributed to the central bank’s monetary policy easing, aimed at reducing interest rates by up to 100 basis points this year, bringing the key interest rate down to 4.75 percent by end-2025, Capital Economics said.
Cushman & Wakefield said the ongoing shifts in global trade dynamics present a vital opportunity for the Philippines to diversify its trade partnerships and deepen ties with emerging economies. At the same time, this is an ideal moment to invest in local industries and enhance the global competitiveness of domestic production, it said.
Residential real estate prices in the Philippines rebounded in the fourth quarter of 2024, recovering from a year-on-year contraction of 2.3 percent in the third quarter to a growth of 6.7 percent.
Home prices also experienced a notable turnaround on a quarter-on-quarter (QoQ) basis, rising by 5.3 percent in the fourth quarter after a 1.6 percent decline in the previous quarter. The price increase was particularly evident outside the National Capital Region (NCR), where residential property values grew by 9.3 percent year-on-year.
