“If you want to earn passive income, you can buy a condo unit and rent it out.”
How many times have you heard this advice? For sure, the thought of receiving a steady source of income without doing too much of the work sounds appealing to many people, luring them to invest in condominiums that they can rent out to both short-term and long-term tenants.
But after many years of high condo rental demand, is it still wise to enter the real estate market at this point?
To answer that question, let’s look at the current state of condominium rental in the Philippines.
The inflation rate is steady
After peaking at 6.7% last September 2018, the inflation rate in the country has significantly slowed down. As of April 2019, the inflation rate has gone down 3%.
According to property consulting firm Colliers Philippines, the benign inflation rate can prevent further interest rate hikes by the Central Bank, thus sustaining the demand for affordable and mid-income residential condos.
Newer infrastructures are being built
The Manila subway infrastructure project can also fuel the increase in condo demand this year.
Dubbed as the most expensive infrastructure project approved by the government, the Manila subway project will be most beneficial to Quezon City, as seven of the 13 stations will be located there.
Furthermore, the construction of the Metro Railway Transit 7 — which will run from San Jose del Monte, Bulacan to North Avenue, Quezon City — will improve transportation within the city, attracting residents and business owners who want to stay within the thick of the action.
You can expect condominium prices within Quezon City to skyrocket in the next few years because of these infrastructure developments. Avida Towers Sola and Avida Towers Vita are right smack in the middle of things as they’re located along EDSA, Vertis North, while Avida Towers Astrea provides a suburban refuge in Fairview.
More office spaces are rising
Office spaces are being constructed as well — this time in Ortigas Center located within the joint boundaries of Pasig, Mandaluyong, and Quezon City.
And along with this rise in office spaces is the prospect of more residential towers to complement them from 2019 to 2021. A lot of young professionals are looking for living spaces near their workplaces to avoid heavy traffic.
Developments are moving outside Metro Manila
If condominium prices in Metro Manila are too high for you, you can start investing in developments outside the capital.
With land now becoming scarce in major business districts like Makati and Bonifacio Global City, condominium developments are now moving to fringe areas.
Foreign demand will continue to fuel residential condos
Strong demand from Chinese investors can also fuel the residential condo market.
Many of them are buying properties in the Manila Bay area, which is why it’s projected to overtake Makati’s condominium market by 2021.
Aside from foreign investors, affluent Filipinos are also looking at the luxury condominium market. The demand in Manila is expected to remain strong due to low prices and high rental yields.
With all this data, it’s safe to say that the condominium investment in the Philippines won’t go down anytime soon. It will continue to thrive in the years come, so it’s best if you can start investing in one right now.