The real estate sector bore the brunt of last week’s market sell-off as investors shied away from property developers amid peso depreciation and slower consumer sentiment. Ayala Land fell more than six percent while SM Prime and Megaworld also declined. Analysts attributed the slide to concerns that higher construction costs and slower pre-selling activity could weigh on earnings.
Developers that rely heavily on imported materials are feeling the strain of the weak peso, which inflates expenses for steel, cement, and fixtures. BDO Securities said that while overseas Filipino buyers might find Philippine property cheaper in dollar terms, domestic demand remains soft because of inflation and high interest rates.
For home buyers, property financing costs remain elevated even as banks start to trim lending rates slightly. Developers are focusing on mid-market and township projects, where stable demand persists. Analysts believe property stocks will stay under pressure until inflation eases and consumer confidence improves.