Despite economic headwinds, JLL Philippines is cautiously optimistic about the real estate market in 2023. The Philippines’ economy grew 7.6% in 2022, its fastest pace in four years. The growth is expected to continue in 2023 but at a slower 6-7%. However, inflation is to remain high, which could dampen consumer spending.

Residential market

The residential market will continue to move sideways in 2023. The mid-scale market is to remain weak, as buyers are reluctant to commit to long-term purchases in an uncertain economic environment. However, the upscale and luxury markets are to perform better, as these segments are less sensitive to economic fluctuations.

Office market

The office market is also expected to recover in 2023, but the pace of recovery will be slow. The sector has several challenges, including rising vacancy rates, softening rents, and changing tenant preferences. However, the long-term outlook for the office market remains positive, as the Philippines remains an attractive destination for businesses.

Hospitality market

The hospitality market is expected to continue to improve in 2023. Occupancy levels are already at pre-pandemic levels, and room rates are slowly increasing. The market is expected to benefit from strong domestic demand, as well as a gradual recovery in international tourism.

Overall, JLL Philippines expects the real estate market to perform better in 2023 than in 2022. However, the pace of recovery will be slow, and the market will continue to face several challenges.

Key Takeaways

• The Philippine real estate market is expected to perform better in 2023 than in 2022.
• The residential market is expected to continue to move sideways, while the office and hospitality markets are expected to recover.
• The market will continue to face several challenges, including rising vacancy rates, softening rents, and changing tenant preferences.

The long-term outlook for the Philippine real estate market remains positive.