CATCH UP PRICING

When Vertis North was launched in 2012, the secondary market in nearby gated villages—previously stagnant at P35K/sqm—began to stir. By the time units in Vertis were being turned over in 2017, surrounding village prices had doubled to P70K/sqm.

A similar pattern played out in Makati. A condominium complex in Makati built in the early 2000s. Around 2016, resale units in the older towers were transacting at around P150K/sqm. Around the same time, the same developer launched new towers within the same complex, priced at roughly P210K/sqm during pre-selling.

Interestingly, the older towers had their own advantages—bigger layouts and proximity to the mall—which helped narrow the price gap over time. Resale prices for these older units slowly caught up, closing in on P210K/sqm.

In 2017, the BIR adjusted the zonal valuation of the entire complex to P200K/sqm. This move effectively created a pricing “floor” for the secondary market. Then in 2021, the newly launched towers began turnover. The resale market was flooded with units, mostly from flippers. As the cheaper units got absorbed, asking prices rose further for both old and new towers—eventually reaching P230K/sqm to P250K/sqm. Again, a new “floor” was implied when the zonal value was adjusted upward to P270K/sqm.

Takeaways:

New projects and Zonal valuation act as pricing anchors – not just for their own inventory but for nearby resale markets.

“Catch-up” pricing is real – older properties with comparable features tend to ride the momentum created by new developments.

Supply absorption creates tailwinds – as inventory thins out, especially in newly turned-over projects, pressure builds on the remaining units, lifting prices.

For buyers, this presents a unique opportunity: sometimes, the next best thing isn't the flashy new tower—it’s the older unit next door, whose price will quietly catch up.

It’ll be interesting to watch how “catch-up pricing” unfolds in Susana Heights, Brazilia Heights, and Lindenwood Residences—especially with SM Prime's bold plan to sell P100 Mn lots in the vicinity. If history is any guide, the ripple effect could be significant. Currently prices are at P35K to P50K/sqm.