For many Filipinos, owning a home in Metropolitan Manila seems like the ultimate dream. It signifies stability, independence, and a significant step towards financial security. But in a real estate market that continues to skyrocket, the pressing question remains—can the average Filipino afford to purchase property in Manila?
This post dives into the costs of buying property in the Philippine capital, compares them to the national average income, and dissects whether this dream is attainable for most Filipinos. We’ll also explore strategies for those aiming to buy a home in this thriving yet complex market.
The Cost of Manila Real Estate
Current Market Trends
The buy Manila property market has seen exponential growth in the last decade. According to Colliers Philippines, the prices for properties in key parts of Metro Manila—such as Makati, Bonifacio Global City (BGC), and Ortigas—are among the highest in the country.
By Q3 of 2023, the average price for a condominium property in Metro Manila ranged from PHP 160,000 to PHP 300,000 per square meter, depending on the district and developer prestige. For a modest 30-square-meter unit, you might spend anywhere from PHP 4.8 million to PHP 9 million.
On the outskirts of Metro Manila, such as Quezon City, Las Piñas, or Alabang, property prices range from PHP 80,000 to PHP 150,000 per square meter—still a considerable investment for many.
Additional Costs Beyond the Purchase
Buying property in Manila requires more than just paying for the unit. Additional expenses include:
- Taxes and transaction fees (approximately 3–6% of the property’s price).
- Monthly association dues for condominium owners.
- Costs of fitting out an unfinished unit (for example, furniture or renovations).
These costs, when combined, make property ownership an investment that goes beyond the purchase price.
Comparing Property Prices to the Average Filipino Income
The Median Income vs. Real Estate Costs
To determine affordability, it’s essential to compare property prices with the average income of Filipinos. Data from the Philippine Statistics Authority (PSA) states that the average annual household income in Metro Manila is approximately PHP 460,000 as of 2022. This translates to about PHP 38,333 per month.
Financial experts recommend spending no more than 30% of your monthly income on housing. For a Filipino earning the average monthly household income, this equates to a housing budget of around PHP 11,500 per month.
To contextualize, let’s say you’ve purchased a modest condominium worth PHP 4.8 million. Assuming a 15-year bank loan at a 7.25% interest rate, your monthly mortgage payment would be approximately PHP 46,000—a price far beyond what’s considered affordable for the average household.
A Look at Savings Rates
According to the Bangko Sentral ng Pilipinas, most Filipinos save about 10–20% of their income per month. With this setup, it would take decades to save enough for even the down payment (typically 20% of the property cost)—which, for a PHP 4.8 million condo, comes to PHP 960,000.
These figures suggest that for many average-income families, purchasing property in Manila outright is financially daunting, if not impossible.
Is Manila Real Estate Unaffordable for Everyone?
While affordability is a challenge for the average family, Manila’s property market isn’t out of reach for all. Certain conditions, financing options, and emerging trends provide pathways to ownership:
Dual-Income Households
For families or couples where both individuals actively contribute to income, the property can become more affordable. A household income of double the average (around PHP 920,000 annually) significantly increases purchasing potential.
OFW (Overseas Filipino Workers) Contributions
Many Filipinos working abroad send remittances to their families, contributing significantly to household income. Remittances have for decades played a role in boosting Filipino families’ capacity to buy property back home.
Flexible Financing Options
Banks and developers offer payment schemes like long-term loans (15–25 years) or pre-selling units (properties sold at a lower price before construction). Such options provide Filipino buyers with expanded flexibility.
Growing City Outskirts
Rising property costs in key Metro Manila hubs are pushing developers to build more affordable options in the surrounding metropolitan areas—like Rizal, Bulacan, and Cavite. Improved public transportation infrastructure, such as the MRT extension projects and the North-South Commuter Railway, is making these areas increasingly attractive for long-term residents.
Strategies for Buying Property in Metro Manila
For those determined to own Manila property, achieving this goal requires careful planning and smart financial habits. Here are some actionable strategies:
1. Set a Realistic Budget
Understand what you can afford before exploring property options. Consider all costs—not just the listed price but also taxes, insurance, maintenance, and monthly loan payments. Use online mortgage calculators for accurate calculations.
2. Save for a Larger Down Payment
Putting down a higher percentage upfront reduces your loan principal, interest rate, and monthly payments. Aim to save at least 20–30% of the property price before purchasing.
3. Consider Pre-Selling Properties
If you’re willing to wait, pre-selling units are often 30–50% cheaper than ready-for-occupancy (RFO) options. Developers also allow flexible payment terms during the construction period.
4. Expand Your Search to Growing Areas
Instead of the central business districts, explore emerging areas in Metro Manila’s fringe for more affordable options. Cities like Pasig, Marikina, or Valenzuela may offer better deals while providing decent access to central areas.
5. Leverage Pag-IBIG Housing Loans
The Pag-IBIG Fund offers lower interest rates and longer repayment terms, making property acquisition more manageable for Filipino workers.
6. Work with Real Estate Consultants
Experienced consultants and agents help buyers find suitable properties based on their financial situation. Many also assist with the complex documentation and processes involved.
7. Partner with Developers Offering Zero-Interest Installments
Developers frequently offer promotions like zero-interest installment terms for the down payment—significantly easing the financial burden on buyers during the initial stages.
Final Thoughts—Is Manila Property Affordable for Average Filipinos?
While it’s clear that purchasing property in Manila is a financial challenge for the average Filipino, opportunities exist for those who approach the process strategically. With diligent saving, creative financing, and an openness to emerging markets, homeownership in the capital can still be within reach.
Are you evaluating your options in the Metro Manila property market? Partnering with financial advisors, trusted developers, or even real estate platforms such as Property Pulse can ease your homeownership journey and lead you towards making informed decisions.
The dream of owning a home in the bustling heart of the Philippines may feel daunting, but with the right tools and mindset, it’s far from impossible.
