Buying Real Estate in the Philippines FAQ

463

What is the Philippines economy like?

• The Philippines economy has grown at a rate of 4.4% in 2008 and expected to grow at a rate of 4.0% in 2009 (Economist Intelligence Unit)
• High government expenditure and large remittances from abroad are projected to drive the Philippine economy.
• Stable currency.
• Higher production in the agriculture and manufacturing sectors.
• A surplus in the Balance of Payments.
• Low debt ratios.
• Rising disposable income.
• Rising consumer expenditure.
• Reducing unemployment.

Is Cebu and the Philippines going to be seriously affected by the global economic slowdown?

The Philippine economy is well positioned to weather the global economic slowdown whose effect on the property market is likely to be subdued because the economy is expected to remain resilient due to significant reforms in fiscal and banking sectors, build-up of reserves, low debt ratios, an increase in government spending, resilient external sector, a surplus in the Balance of Payment, large remittances, channeling of remittances into investments especially housing, resilient domestic financial markets, adequately capitalised banking system, low exposure to sub-prime related distressed credit products and increasing saving ratios.

What are the Philippines main attractions?

Warm all year round weather, a rich culture, friendly fun-loving population, stunning landscapes and beaches, warm clear waters with colourful coral reefs and marine life and a large number of facilities and attractions make the Philippines an extremely desirable destination for tourism and development.

Is the Philippines expensive?

The Philippines offers extremely good value for money to travelers. The cost of living is well below European countries such as the UK. Here a few examples:
• Average apartment electricity bill from $20 to 40 / month
• Average apartment water bill $3 to 5/ month
• Average landline phone $10 to 15/ month
• Meat $3 to 4/kg
• Poultry $2/ kg
• Fish $2 to 3 / kg
• Vegetables $0.75 to 1.50/ kg
• Average salary for a maid is US$40 to 45 /month
• Average salary for a driver US$90 to 100/ month

How safe is the Philippines?

On the whole the Philippines is a safe country to visit, but you should take precautions. Things to look out for are street crime, which has begun to grow in the larger more tourist filled areas, particularly pick pockets. You should keep valuables out of sight and be careful not to walk around with large amounts of cash. You should also avoid walking through dark or deserted places at night.

There is a conflict with rebels and the government but this is confined to remote areas in the south of the country.

Are there any hazards that I need to be aware of when I travel to the Philippines?

The Philippines can be struck by natural disasters like typhoons, earthquakes, floods, landslides and volcanic eruptions, but they are no more than in many other countries in this part of the world. Travellers need to keep out of the typhoon season from October to December.

Is the Philippines easily accessible?

Certainly, there are frequent low cost flights from all major cities in the world.

Do I need a visa to travel?

European and US national are allowed to enter the Philippines without visas for a stay not exceeding 21 days, provided they hold valid tickets for their return journey.

Can foreigners own property the Philippines?

Ownership laws in the Philippines does not allow foreigners to own land, but allows the ownership of apartments in high-rise buildings as long as the foreign proportion in a apartment block does not exceed 40%.

Foreigners can buy a house but not the land on which it is built. A long lease on the land of up to 50 years which is renewable for another 25 years is usually arranged.

Can I buy a property without physically travelling to the Philippines?

Yes, as long as you deal with reputable developers and agents and have a lawyer that represents you, then there is no reason why you shouldn’t buy a property without travelling if this is what you want to do.

Are there any advantages in buying off plan?

Buying off plan in one of the newly built developments offers exceptional value and is the best option for foreign buyers for the following reasons:
• It allows the buyer to pay in small installments.
• New roads and the infrastructure of the development are already in place.
• The new developments are built to modern international standards.
• A very good selection of units is available to suit all tastes and budgets.
• The properties offer excellent potential for capital appreciation especially as the construction work progresses.
• There are usually no restrictions on selling the unit before completion.
• Clean title deeds and easier property registration.
• Growth of the real estate market, price increases and project completion means that investors in new developments will indeed greatly benefit from substantial capital appreciation by the time their property gets ready.

Is buying property in the Philippines a good investment?

The Philippines real estate market has excellent potential as:
• The stability of the property market in The Philippines is closely linked the stability of its economy which is currently expanding at a sustainable rate.
• Warm all year climate with excellent rental potential throughout the year.
• High demand from domestic and international investors.
• Prices are still very reasonable and much lower than prices in similar economies.
• High yields and excellent capital appreciation potential.
• Strong demand from 11 million Filipinos living abroad.
• High infrastructure expenditure.
• Good accessibility and low cost flights.
• Thriving tourism with the number of tourist increasing rapidly further driving demand for real estate.
• A wide and distinctive range of luxurious developments in outstanding locations.

Which areas are good to invest in?

The islands of Boracay and Mactan present excellent investment opportunities because of their accessibility, beautiful beaches, stunning landscape, luxurious resorts and a wide a range of facilities and activities.

Can I rent my Philippine property when I don’t need to use it?

Certainly, booming tourism and strong all year round rental demand offer investors the opportunity to rent out the property for excellent yields.