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Buying Property as an Expat
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What is the complete guide when buying a property in the Philippines?
Triptomani
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What is the complete guide when buying a property in the Philippines?
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Firstly, if you are not a citizen or do not have a resident’s visa you are not allowed to buy property. You will have to buy through a proxy and that could become fraught with problems. Secondly, carefully check the title. Make sure it is genuine and has no encumbrances. This is a poor country and people often take the title to the bank or a money lender as security for a loan. Make sure there are no “adverse claims” from third parties who (rightly or wrongly) think thy have a claim to all or part of the property. Also check the utilities. You may find if the house has been vacant for a while that some enterprising person has tapped the electric or water line. Thirdly, check for squatters. The attitude towards land ownership is quite casual and people do build on land which doesn’t actually belong to them. This is especially true in the provinces. So I suggest getting the land surveyed and marking the boundaries with “monument” posts. Make sure there are no other buildings or squats inside these boundaries. In Manila, there was a investor who “land banked” an area of land for future development. By the time he came to develop, the land was covered in squats. It is a difficult and cruel process clearing the squats, and speculation is rife that some fires that razed slum areas in the past have been part of this clearance process.
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Who is going to own it? Unless its a Condo you’ll need to sign off with either a filipino spouse, child, or corporate shareholder(s).Philippines 12% VAT tax used to be excluded for properties under P2 Million Pesos. Now it a requirement for all purchases.Development companies are advertising ready for occupancy homes yet sometimes the homes don’t have any water. Their original plans for tapping water fail. The home could sit for months if not years without water and the buyer is screwed.Triple check what electric source and internet providers cover a particular area in which you plan to buy your home.It’s a safer bet to buy flat land near the top of a hill vs. sloping land or at the bottom of a hill to better preserve the home through times of heavy rain.Home insurance for flood, typhoon and earthquakesDo you plan to live, rent, or resell?Is the real estate market & stock market heading up or down?Will the home still have a good view once everything is built?As a tourist be prepared to never get your money back out. Banks do not offer HELOC (Home equity line of credit) to tourists for property titles in their name. So if you pay spot cash or deferred cash for a Condo you can’t loan any of that money back in the future. Often they will sell real estate with very nice views of their model units and then once building is finished the upkeep of the neighborhoods is not to western standards. In addition the developers may own all the land to the right, left, front and back of where they started to build the original neighborhood and any good nature views will be diminished in a matter of years. To preserve a nice view make sure your house is on the edge of a cliff/hillside.