Over the last 18 months I've heard a few people tell me that they'd been to seminars in Australia about investing in property in the philippines. I work in Asia quite a lot so agree there are some great opportunities out their in some emerging countries. I don't however know very much about the Philippines and a little worried about their legal system there. Has anyone had any experience or know of any places to get more information on this?
Thanks in advance
Nadabe careful on how much you pay. The prices quoted in Aus are inflated by 30% – 50%.
A decent townhouse on or near water and near Manilla or any other major city will return around 10% RR. Capital growth will not be anywhere near the 7 – 10 yr doubling like here in Aus unless you have teh right land.
If you want to buy there, make sure you visit. The legal system works just fine.
D
I have a a very good investment in Boracay, 12% rental guaranteed for 15 years!!!!
Regarding investing in property in the Philippines:
– yields tend to be good indeed, i.e. 10% or above, but for holiday lets consider that during the rainy season most (beach) resorts struggle to get many guests
– legal system is ok, you can actually buy more than just the usual condominiums like land, houses etc. but then you need to get a business structure in place which as long as you have a reliable lawyer on your side should be ok (you can only own 40% but there are ways around That)
– Only buy titled land (be careful with tax registered)
– Look carefully into who will manage your property, I have lived in the Philippines for the last 6 years and maintenance of properties is in general pretty poor to say the least.Capital growth is far from assured, I would probably look at residential estates on the outer side of Manila e.g. Alabang area or consider Subic which is likely to grow strongly in the future with major investments in semiconductors, shipyards and finally some infrastructure improvements (new highway and rumours of a rail line). Alternative could be beach resorts e.g. a new development is being marketed in Cavite and being not too far from Manila this could have good growth prospects.
In summary when you're doing your reserach and making a decision remember that the Philippines is 3rd world country with all the associated risks and that real estate is controlled by a small group of very powerful families. If you do invest, make sure you expect big returns for the risks you take.
im planning to invest somewhere in Ilocos and right now im surveying the area because i want to build a farm here. what things should i consider aside from tax laws and stuff
Hi Nada,
if you are really looking for good opportunities in emerging markets there are plenty of other Asian countries you can invest in that are far more advanced and more secure than the Philippines. I have been looking there recently at completed projects and the build quality is not particularly high from what i could see. Granted the prices are cheap but the yields are comparative and they are not expecting high growth. Corruption is also rife there so you need to really understand what you are doing and who you are doing it with.
If you are interested in other more solid opportunities I can highly recommend a company called IP Global in Hong Kong (see my posts on the forum titled "Ask me how I bought properties in 5 countries". If you want to know more about anything I have said there just drop me an email.
This year I have purchased properties in Bangkok, Kulala Lumpur, Sabah (Malaysia) and Panama so I have had plenty of experience with checking out the deals etc.
Good luck
Adrian
(Hong Kong)
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