MANILA, Philippines — Rising living expenses and reduced government infrastructure spending are putting pressure on the Philippine property sector, Senate President Win Gatchalian warned on Thursday, October 8.
Speaking at the Manila Overseas Press Club, Gatchalian said slower economic growth, delays in public infrastructure projects, and declining household purchasing power were affecting property development and market demand.
He pointed to the Philippine economy’s 2.3% growth in the second quarter of 2026, significantly lower than the 5.4% expansion recorded during the same period last year.
According to Gatchalian, the weaker economic performance has prompted major credit rating agencies and international financial institutions, including S&P Global Ratings and the Asian Development Bank (ADB), to lower their full-year growth projections to below 3.5%.
He also cited a 32% contraction in public works construction during the second quarter, which he linked to spending restrictions and project delays following corruption investigations involving flood control projects.
During recent Senate hearings, Gatchalian presented estimates indicating that economic disruptions and lost opportunities had cost the country approximately ₱2.75 trillion since mid-2025.
He said the suspension of civil works in various regions had slowed land development and delayed commercial projects planned along key economic growth corridors.
HIGHER PRICES WEIGH ON HOME BUYERS
Gatchalian also raised concerns over the impact of rising prices on Filipino households, particularly their ability to afford housing.
Inflation climbed to 6.1% in August following energy price shocks associated with the conflict in the Middle East. Diesel prices reached ₱153.70 per liter, while gasoline rose to ₱96.50 per liter.
The rising cost of essential goods and transportation contributed to a slowdown in real household consumption growth to 2.8%, prompting families to exercise greater caution when considering major financial commitments, including home loans.
The residential property market has likewise experienced weaker growth, Gatchalian said, citing data from the Bangko Sentral ng Pilipinas (BSP).
Nationwide residential property price growth slowed to 0.4% in the second quarter, marking the weakest increase since the central bank began tracking the figures in 2019.
Outside Metro Manila, residential property prices declined by 2.7% as elevated construction expenses and cautious buyers contributed to an accumulation of unsold units.
CALLS FOR INFRASTRUCTURE REFORMS
Gatchalian also highlighted concerns over the implementation of public infrastructure projects during Senate budget deliberations, noting that more than 7,000 proposed public works projects had been flagged because of incomplete site documentation.
He added that the proposed allocation for flood control projects in the upcoming national budget had been reduced to ₱107.4 billion.
To help stimulate economic activity and provide greater certainty for infrastructure development, Gatchalian called for the faster passage of the proposed Masterplan for Infrastructure and National Development (MIND) Bill, which seeks to establish a 30-year infrastructure development roadmap.
He also endorsed the proposed Ginhawa Bill, which aims to provide targeted tax relief to help households retain more disposable income.
Gatchalian said addressing infrastructure delays and easing financial pressure on families would be important steps toward supporting economic growth and revitalizing the property market.