METRO MANILA ranked second in Knight Frank’s Prime Global Cities Index for the first quarter of 2026 after annual prime residential prices rose 19.9% from a year earlier, according to Santos Knight Frank.

“It is a strong vote of confidence in the luxury residential market. This recognition was driven by the exceptional performance of the landmark developments,” Anjo Sumait, head of residential services at Santos Knight Frank, said during a media briefing last week.

Mr. Sumait cited Ayala Land, Inc.’s Park Villas and Laurean Residences among the developments that drove the market, with asking prices of about P1.2 million per square meter and P876,000 per square meter, respectively.

Metro Manila has seen sharp swings in the global rankings over the past year. It ranked 39th in the first quarter of 2025 after annual prime residential prices fell 1.6% year on year, before climbing to fifth in the second quarter with 9.1% growth. It slipped to ninth in the third quarter as annual price growth eased to 5.4%, before rising to second in the latest index.

Mr. Sumait said the local luxury residential market is entering a period of natural normalization after several years of price appreciation, as geopolitical uncertainties and the exit of Philippine Offshore Gaming Operators temper broader market activity. Even so, the latest ranking suggests the city’s prime segment remains closely watched by developers and buyers because a relatively small number of high-value projects can influence the overall index.

He added that established luxury villages such as Forbes Park and Dasmariñas Village continue to command premium prices, with asking prices reaching about P800,000 per square meter and P750,000 per square meter, respectively.

Globally, annual prime residential price growth slowed to 2% in the first quarter, from 2.9% in the previous quarter and 4% a year earlier, indicating a more measured phase for the luxury housing market, according to Knight Frank.

“The latest results point to a more selective phase for global luxury housing markets. Price growth remains positive overall, but the pace has cooled and performance is increasingly concentrated in a smaller group of markets. As rate expectations, currency movements and wealth flows continue to shift, city-level fundamentals are likely to matter more than broad global momentum,” Liam Bailey, Knight Frank’s global head of research, said in the report.

Mr. Sumait said demand for prime residential properties in the Philippines is expected to remain resilient, supported by overseas Filipino worker remittances and a growing middle-income population seeking higher-quality homes. That broader demand backdrop also helps explain why the segment continues to attract both new launches and resale activity, even as buyers become more selective about location and terms.

In the secondary luxury residential market, Taguig posted the highest asking prices at P864,000 per square meter, followed by Makati at P433,000 per square meter, while Alabang and Mandaluyong both stood at P357,000 per square meter.

Mr. Sumait said the widening price gap between the primary and secondary markets is encouraging more buyers to consider resale properties, where sellers are increasingly offering more flexible bank financing than the cash-heavy payment terms that previously dominated the luxury segment.

Santos Knight Frank said developers are increasingly shifting toward horizontal residential projects in growth areas such as Cavite, Laguna, and Batangas, supported by infrastructure projects including the Metro Manila Subway and the Light Rail Transit Line 1 extension, which are expected to improve connectivity and unlock new residential corridors.

The consultancy said more than 700 luxury residential units are scheduled for turnover this year, including Shang Properties, Inc.’s 285-unit Aurelia Residences and Arthaland Corp.’s 71-unit Eluria in the third quarter, as well as Ayala Land’s 409-unit Parkford Suites Legazpi in the fourth quarter. — Juliana Chloe A. Gonzales