Metro Manila Condo Vacancy Reached 24.9% as Cheap Units Took Over Demand

Colliers put Metro Manila's secondary condo vacancy at 24.9% in Q2 2026, heading for 25.6% by year-end, with roughly 80,000 unsold units still on the market.

One in four condominium units in Metro Manila's secondary market sat empty in the second quarter of 2026. Colliers Philippines put the vacancy rate at 24.9%, up from 24.7% in the first quarter, and projects a peak of 25.6% by the end of the year. In the Bay Area — the reclaimed-land district built out largely around offshore gaming operators that have since left — vacancy is approaching 60%. Roughly 80,000 unsold units remain across the capital region, of which 32,600 are finished and ready for occupancy.

Developers have already stopped building

The supply response has been severe. Developers launched 1,200 units in the second quarter and 2,600 across the first half of 2026, a 64% drop from the same period last year. That is the market working as it should — new supply shut off while the existing overhang clears — but the overhang is large enough that the arithmetic takes years rather than quarters. Net take-up in the second quarter was 500 units, down 60% from the first quarter and the weakest reading in five quarters. At that absorption rate, the 32,600 completed unsold units alone represent an extended clearing period.

The demand that remains has moved down-market

The more consequential shift in the Colliers data is compositional. Economic and affordable segments accounted for 67% of first-half net take-up, against 33% a year earlier — the affordable band alone at 38% and the economic band at 29%. Buyers in the P1.8 million to P3.6 million range are now the market. Financing explains much of it: the state housing fund Pag-IBIG is offering a promotional 4.5% annual rate through the end of 2026 and has raised its maximum loan to P10 million from P6 million, terms that reach buyers commercial lenders do not serve. Around 9,300 unsold ready-for-occupancy units are priced between P3.601 million and P5 million, close to but above the band where demand has concentrated.

Why the national numbers look calmer

Glopra's market data shows the Philippines at an average of $2,396 per square metre with prices 4.5% higher than a year earlier and a gross rental yield of 5.11%, as of the 23 July snapshot. That national figure and the Colliers vacancy figure are not in conflict, because they measure different things: the national series spans all residential stock across the country, while Colliers is reporting the secondary condominium market in one metropolitan area — the segment that absorbed the most speculative construction of the past decade. The bubble-risk score of 42 out of 100 sits in the moderate band nationally; the Metro Manila condo segment is plainly under more strain than that suggests.

The bottleneck to watch

Colliers research director Joey Roi Bondoc argued that accelerating license-to-sell approvals is critical to housing recovery, pointing at the administrative pipeline rather than demand as the binding constraint on the segments that are actually selling. That is an unusual diagnosis in a market with 80,000 unsold units, and it reflects a genuine mismatch: the inventory sits in price bands buyers have left, while the units buyers now want require fresh approvals to build. Gross yields quoted here exclude the 25% effective rental tax rate applied to the standardised non-resident case.

Sources: Manila Bulletin (Colliers Philippines Q2 2026 briefing) https://mb.com.ph/2026/08/12/affordable-homes-buck-metro-manila-condo-glutcolliers

Market data: Philippines