INVESTING IN PHILIPPINE REAL ESTATE
Acquiring a condo property in the Philippines is easy – you just need to know the basics

1. REQUIREMENTS

Both Filipinos and foreigners can buy condo units in the Philippines. The paperwork is essentially:

  1. Proof of payment of Reservation Fee
  2. Proof of sufficient income
  3. 2 Valid IDs (passport, if foreigner)
  4. Reservation Agreement or RA (to be given to you by the developer)
  5. Buyer’s Information Sheet or BIS (also to be given to you by the developer)

2. MOVE IN NOW OR LATER?

There are two kinds of condos available: Preselling condos and RFO.

Preselling Condos

Preselling condos are buildings that have been fully designed and masterplanned but have yet to be built or construction is ongoing. Prices are usually low to begin with and rise significantly when the project is complete. This makes them attractive investment opportunities.

If you’re an Overseas Filipino Worker (OFW), a preselling condo is a great way to invest your hard-earned money. You don’t need to move in right away and the affordable starting price means you’ll reap returns later on if you decide to resell.

RFO

RFOs are great if you want to move in right away. They’re fully built (sometimes furnished) and ready-to-go.  You simply buy the unit and move in. The cost of an RFO unit depends on the location, amenities, and prestige of the project. It will ultimately depend on your budget and specific needs.

So, do you prefer to wait on a preselling condo? Or do you need a home to move into now?

3. CHOOSING YOUR DREAM HOME

Once you’ve settled on the kind of condo you want it’s time to look for a unit.

We recommend you take time to write down what exactly it is you’re looking for. Ask yourself these questions:

  • What kinds of amenities are important to you?
  • How close to work do you want to be?
  • Do you need parking space?
  • Do you need to be near schools, medical facilities, or other establishments?

These and others will help guide you as you navigate the many different options out there. Your answers will help remind you of the practical issues that will be most important when making a purchase decision.

4. LEASEHOLD OR PERPETUAL OWNERSHIP?

In the Philippines there are two kinds of condo “ownership”: Leasehold Ownership and Perpetual Ownership.

Leasehold Ownership

This is a kind of limited possession that lasts roughly 50 years after which you can either extend the lease for 25 years or return the property to the developer/landowner. In effect you are buying the right to live in the property for a fixed amount of time. This kind of ownership might make strategic sense to you. Just be sure to check the leasehold stipulations so you know who takes care of maintenance and repairs as well as what’s covered in the monthly fees etc.

Perpetual Ownership

With Perpetual Ownership you get to fully own the property. You don’t have to give it back to the developer/landowner after 50 years – or any amount of time. You can live in it for as long as you like and eventually pass it down to your kids or grandkids as an inheritance.

Leasehold and Perpetual Ownership each have their advantages, depending on your needs and goals. If you’re an investor who wants to make money renting out multiple units, leasehold may be a good option for you. If you’re a homeowner who wants to pass something down to your family, then Perpetual Ownership is what you need.

Make sure to look for this option when scouting.

5. TRACK RECORDS

When you start reaching out to agents and real estate companies, you need to be sure that you’re dealing with professionals. Trust is the name of the game.

Is your agent accredited? Does he come recommended? What’s his sales experience like? Can he answer all your questions?

What about the developer? How many years has the company been in business? How many projects does it have? How many buildings have been successfully turned over? Is the company financially stable?

It’s important to weigh the facts and online feedback, both positive and negative. Just because it’s on the internet doesn’t mean it’s true. Validate your sources. Look for proof. Examine the marketing materials, look for the HLURB (Housing and Land Use Regulatory Board) License to Sell number, or call the HLURB to check if the development is registered and complies.

In short, be diligent, ask the right questions, check that the development is legitimate, and choose wisely.

6. FINANCING

Usually when buying a condo you have to provide a 20% down payment. The remaining 80% can be paid either through cash, bank financing or in-house financing (if the developer offers that option).

Because of our booming economy, today’s home loan options are generally favorable, with decent interest rates, flexible deals, and repayment terms falling between 10-20 years. It really depends on the terms and service that resonate most with you.

Check out the following bank options. If you’re an OFW, they may also have specific terms.

Banco De Oro Home Loan

LBP Pabahay Program

PNB’s Sure Home Loan

HSBC Home Loan

BPI Family Housing Loan

Security Bank Home Loan

PSBank Home Loan with Prime Rebate

Chinabank HomePlus

EastWest Home Loan

7. CENTURY PROPERTIES

If you need extra help and want to know how you can avail of a Century Properties unit, feel free to contact us. We’ll advise you on how you can acquire a Century property and show you all the options and tools at your disposal, from purchasing your first condo to maximizing it for passive income via Siglo Suites, our exclusive leasing management firm.

We wish you all the best in your quest for your dream home.