Property developers face a challenging environment as weaker sales and rising costs drag earnings. Ayala Land, Megaworld, and Filinvest Land all missed expectations in the third quarter, citing sluggish demand and construction delays.
Analysts said property’s underperformance reflects slower GDP growth and tighter financing conditions. Developers have postponed launches, focusing instead on clearing existing inventories.
Despite the near-term gloom, brokers see long-term potential as valuations hit multi-year lows. Ayala Land and SM Prime both have over 70 percent upside to target prices, according to BDO Securities.
Investors are advised to stay selective, favoring developers with strong balance sheets and recurring income from rentals. However, recovery will depend on how quickly consumer confidence rebounds and mortgage rates ease.
Until then, property remains one of the most cyclical and sentiment-sensitive sectors in the market.