Supply-demand ‘mismatch' caused condo oversupply —realtor

The oversupply of condominium units in Metro Manila, which has surged to an equivalent of 34 months, can be attributed to a “mismatch” between inventory and demand in the Philippine real estate market, according to realtor and Filipino Homes founder Anthony Leuterio.

Leuterio said the country’s real estate sector is facing a “significant challenge of a persistent mismatch between developer inventories and buyer demands.”

The realtor pointed to an “oversupply of real estate inventory,” particularly in Metro Manila.

However, he said the problem lies not in the lack of buyers, but rather in the fact that the products being developed do not align with what buyers actually need.

“The market is huge in real estate, but the unmet demands versus the inventory are not matched,” Leuterio said in a statement.

One major issue the realtor identified was the industry's reliance on flawed market studies.

Developers often base their decisions on data analysis that is skewed toward their perspective, rather than considering the broader market, he said.

“The problem in the whole country is that they are not looking at the marketing side—the unmet demands,” he added. “The studies are focused on developers, not on the actual needs of the market.”

Leuterio said that such an approach led to developers producing high-cost properties in locations that do not match the needs or purchasing power of buyers.

With this, the realtor called on developers to rethink their strategies by prioritizing market research and engaging marketing professionals, instead of relying solely on internal studies.

He said that developers should focus on understanding the financial capacity of buyers, rather than funding expensive projects that require high recovery costs. — VBL, GMA Integrated News