The Philippine real estate sector, with Cebu at the forefront, is preparing for a year of strategic rebuilding in 2026. Industry leaders forecast a period focused on restoring confidence, recalibrating products toward affordability, and addressing infrastructure gaps following a challenging 2025 marked by natural disasters and softer market sentiment.
A Transition Year for Rebuilding Trust and Products
Anthony Gerard Leuterio, the founder of Filipino Homes, described the coming year as a transition phase rather than a breakout period. He emphasized that growth will be driven by gradual confidence-building measures and product realignment after a difficult 2025, which saw growth limited to approximately 10 to 15 percent.
"2026 will be about rebuilding — rebuilding the market, rebuilding products, rebuilding trust, and even rebuilding the image of the sector," Leuterio stated. He anticipates the recovery will be steady, not explosive, as the sector works to overcome recent confidence shocks.
In Cebu, underlying demand is expected to remain resilient, supported by consistent population inflows, job creation, and education-driven migration. Harold Vince See, president of the Subdivision and Housing Developers Association Inc. (SHDA) - Central Visayas, noted that the local market should post steady growth, particularly in affordable and high-end housing segments.
"There is still an influx of students coming into Cebu, with more universities opening, including national players," See explained. "Over time, these students stay on, find work, and eventually their families invest in property here."
Market Reset: Pivoting to Address Housing Backlog and OFW Demand
A key part of the 2026 reset involves developers shifting focus away from oversupplied high-end segments. The new priority is the middle-income, economic, and socialized housing markets, where a massive structural demand persists. Leuterio estimates the country's housing backlog at a staggering six to seven million units and rising.
This backlog is pushing developers to introduce more competitively priced products. Condominium units priced between P2 million and P2.5 million have gained significant traction, especially among Overseas Filipino Workers (OFWs).
"Around 80 to 90 percent of OFWs are willing to invest in this type of product. It’s affordable, and it addresses the lack of housing," Leuterio said. In Cebu, buyer preferences are also evolving due to changing demographics and worsening traffic, making younger couples and small families more open to condominium living than a decade ago.
Infrastructure and Policy: Critical Factors for Sustained Recovery
Both leaders identified infrastructure constraints as a primary risk to the market's recovery. See highlighted that outdated drainage and water systems, many constructed in the 1980s and 1990s, have worsened flooding issues. He stressed the urgent need for a Metro Cebu-wide drainage master plan, with developers already coordinating with local governments for a unified approach.
Leuterio echoed the call for stronger public-private sector coordination, particularly to manage increasing climate risks that affect project viability. "There has to be a body that connects government and the private sector," he said, advocating for structures that enable faster responses to emerging challenges.
On the policy front, proposals to raise price ceilings for socialized and affordable housing could support the rebuilding phase by lowering tax burdens for buyers and enabling developers to expand supply. Both See and Leuterio emphasized that greater private sector participation and improved access to financing are essential to tackling the housing shortage.
Looking ahead, Cebu developers expect heightened competition in 2026 to benefit buyers, with more projects offering energy-efficient designs, solar power, and smart-home features. There is also a push for greater transparency regarding flood history and site risks.
"If we solve water, drainage and other core infrastructure issues, Cebu’s growth story remains intact," See concluded, underscoring the foundational role of infrastructure in the property sector's future.
