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Buying property in the Philippines

I have made an offer on a new house to be built in Baguio, and wondered what sort of things I should be aware of before I take the plunge.

1. Is the price of a new house likely to increase over, say, the next 5 yeas or so?
2. As a foreigner would I have any problems selling the house?
3. Are house-building guarantees meaningful here?
4. Anything else I should be aware of?

Thanks.

This topic has been discussed extensively in past threads. Try searching the Philippine forum under "Accommodations" and you will find threads about buying a house, land, condos, etc.

To answer briefly your questions:

1. Maybe. Generally, the price of a house / structure goes down over time. A similar looking but newer house built near your house will fetch a better price than your house. Land prices may appreciate depending on zonal valuations in your area.
2. Yes.
3. No.
4. A lot more than you think.

Are you married to a Filipina?  If not, how are you buying a house, you cannot own the land or are you buying a condominium.

TeeJay

That's good to know. I plan to many a Filipina in January 2017, so will need to delay any decision on buying until then! Thanks!

Thanks for those answers ... I obviously need to do a lot more research on this forum and elsewhere before I take the plunge and buy property here. 😎

Hi there dimps99...Housing costs in the philippines and in other countries as well increases each year, considering the directly related increase on construction materials. On building houses, you should also consider labour. Labour costs can be twenty percent higher on summer compared to the rest of the year and it is quite difficult to find good labour since most projects are planned when it is sure sunny. You may need to find good labour elsewhere and that would cost more. The down side on building houses on rainy days is that the rain may ruin your schedule as well as the quality of slab you'll get if your site is uncovered. Baguio is one of the coolest place to be with in terms of weather so there is no need for airconditioning. Lastly, considering that you are a foreigner, are you aware about the government policies for you to own a property? as i know, you can only own 30 percent of the property and have 70 percent on a local's name. I hope that your co-owner won't take good advantage of you because it may end up that he or she can acquire the property.

just read that you'll be marrying...on other case then it would be conjugal...so you'll increase your ownership from 30 to 50 %...lol

Thanks Lou.  So when you say "local" you just mean a Filipino? So, I could never own more than 50% ... maybe not a good idea to have an argument with my future wife then!!!!

yup..i mean a filipino citizen, mr.dimps...i certainly agree that you certainly should not disagree with your wife...imagine what she can do with your balls if it would be on her hands hands...ouch!!! (-: ...just kidding, life instead of balls i mean... i sincerely wish that you are choosing the right person and she loves you trully.

You're quite right of course ... anything can happen in a relationship over a few years. Maybe we should just buy a tent! 😊

Dimps99 :

I have made an offer on a new house to be built in Baguio, and wondered what sort of things I should be aware of before I take the plunge.

1. Is the price of a new house likely to increase over, say, the next 5 yeas or so?
2. As a foreigner would I have any problems selling the house?
3. Are house-building guarantees meaningful here?
4. Anything else I should be aware of?

Thanks.

Dimps99

Here is a thread with a lot of details with regard to land / property ownership in the Phil. 

http://www.expat.com/forum/viewtopic.ph … 80#3112876

Regards,

TeeJay

Thanks for the link Teejay ... a lot of interesting points and discussion made there!

Dimps99 :

Thanks for the link Teejay ... a lot of interesting points and discussion made there!

I am not sure if these points were brought up in the thread so I will add to it.

Make sure the title is clear and unencumbered and that the seller is empowered to sell the land. It may have been inherited and require other family members to agree to the sale.

In some cases the land has no clear title and the family has simply lived on it for a few generations and clear ownership can be a nightmare.

Fake titles are also out there. If the seller is legitimate ask him or her to produce the title and go with you to the register of deeds office where the records should match the title in hand and list to whom the land belongs and if it is unencumbered.

Make sure the land is not titled as agricultural. You may not be able to build on it.

A couple of helpful links:

http://real-estate-guide.philsite.net/taxes.htm

http://www.efrennolasco.com/how-to-proc … ilippines/

http://www.bir.gov.ph/index.php/tax-inf … s-tax.html

http://www.bcphilippineslawyers.com/the … ilippines/

http://real-estate-guide.philsite.net/tips.htm

http://www.philippinesangeles.com/basic … ownership/

http://philfaqs.com/i-heard-a-foreigner … ilippines/

Lastly this site is a wealth of information for an expat from buying land to building a home and construction practices and mistakes made.

If you buy land also check to make sure it is not in a flood zone or sitting on a fault line. The type of soil should provide good drainage and support for your foundation. 

http://myphilippinelife.com/

Fault lines in the Philippines:

http://www.phivolcs.dost.gov.ph/images/ … index.html

Some of the information may be redundant, though each link has something useful to offer to the newbie.

Regards,

TeeJay

Thanks again for all your input Teejay ... you should write a book on the subject! :)

Time for me to get a comfortable chair and start reading!

For a foreigner to buy a house and lot here in the Philippines, you can not own a house & lot if the title is TCT, only properties like condominium or townhouse with CCT title.

Hi Ricky, what do TTC and CCT stand for?

Rent first check out the area, neighbors,talk to expats that live in the area.Remember it's easy to buy, hard to sell.

TCT - Transfer Certificate of Title
     title for House & Lot, Lot, Townhouses etc

CCT - Condominium Certificate of Title
        for condominium

Thanks Ricky 😎

You could only buy and own a condominium here in the Philippines.
Thanks.

@ Dimps99,

The topic of marriage and asset protection has been touched on many times here and in other blogs.  Therefore, I will just focus on the process of selecting and building a house here.  Listed below are some resources I flagged for my personal use when and if I am able to build a home here.  Since my concerns are on the construction and material quality here, I placed great research effort in the areas of:
    •    Concrete mix ratios
    •    Rebar sizing
    •    Soil conditions
        •    Earthquake related design considerations

Comments & Resources:

Try to avoid the local mix of 3-2-1 as you can find many structures that have crumbling surfaces as a direct result of the local mindset to "add more sand while using less concrete" is a big driving force.
http://www.everything-about-concrete.co … atios.html

The use of smaller rebar as an additional "shortcut" is also common.  Use this article's tables to convert for US/Canada specifications to your minimum stated standards to the contractors here.
http://www.barlines.com/images/a100.pdf

Beware of being sold a lump of clay filled soil!  Here3 is another article from an expat that does a great job of highlighting their mistakes along the way to their home build.
http://myphilippinelife.com/deep-founda … e-tropics/

In another post, I made a few comments about earthquake based designs and I suggest you include some research on that topic also.  Based on this separate topic, I do not intend to use less than 4000 PSI rated finished concrete and will attempt 6000 PSI mixtures for main support areas of any home I may build. 

Additionally, there are some great explanations and illustrations that can be found in pages 4-14 of the below NIST/NEHRP Seismic Design Technical Brief No. 1 PDF that cuts through some of the heavy math on earthquake calculations for reinforced concrete/beam-colum joint designs in buildings that you may find informative:  http://nehrp.gov/pdf/nistgcr8-917-1.pdf

This last posted article should be a good warning to all of us on the topic of shortcuts and poor construction methods globally.  Be sure to check out this article's embedded map showing "Seisemic, Volcanic and Tropical Storm Risk" overviews of the Philippines. 

Best wish for your new adventure here is the PI.

Thanks to Calif for such a good technical summary on house-building (way over my head as a non-techie!) and to all other contributors to this topic. 😊

One subject that has not been touched on is the involvement of a legal representative when buying a property.

I am just waiting for a final quotation and drawings on a property built within a complex by a well-respected local builder.

The quality of the other houses on the complex appears to be 5-star but should I appoint a solicitor to do local searches etc. (as I would do if I was still living in the UK) to ensure that, among other things, there is no debt on the lot on which the house will be built on?

Hi Dimps99! We have a friend a foreigner too that is married to a Filipina.  Since he cannot owned the land 100% and he wanted to live here and had invested to thwir property what he did is, he made a contract of lease. Wherein his wife is the leasor and he lease the land for 50yrs... Or more... Dont know the legalities but ypu can ask a lawyer...

@ Dimps99,

Sorry if my past post is a bit tech slanted.  However, the topics you raise are indeed serious and complex.  Before retaining any atty, I recommend you make yourself very much aware of the below listed information and if you still feel the need to hire legal help, do so after gaining as much knowledge as you can gain from any web connected location globally.

1.  Regarding confirming the lot/land is free and clear, you may want to review the following:

All authentic land titles in the Philippines are supplied by the Banko Sentral ng Pilipinas. These special papers are physically very unique from all other kinds of papers. You/your rep should look for:

"The texture is similar to that of a bank check
It has a faint watermark that says “LRA“
If it’s an old title (before the newer e-Titles being used today), the color of the paper is light yellow.

If it’s an e-Title, the color should be pale straw.

Tiny fibers and dots should be noticeable and if you could use a UV light, these fibers should fluoresce or shine slightly when subjected to UV light."

2.  Regarding trusting the builder:

Land developers are required to be licensed -
Any development on lot/land in a sub-division requires the project to be registered and that the broker/agent has a license to sell to you issued by the HLURB. - Get this answered in writing and confirm it by a visit to the HLURB website (www.hlurb.gov.ph).

3.  Reviewing history or previous negative event confirmation:

If serious issue have happened in the past (including pre selling violations) there is a possibility a set of  "cease and desist orders" exist.

For Metro Manila check here:  http://hlurb.gov.ph/ wp-content/uploads/home/ project%20with%20CDO/ CDOENCR.htm
For Nationwide check here:  http://hlurb.gov.ph/about-us/

4.  Reviewing a law to "protect" buyers:

Presidential Decree 957 (http://www.lawphil.net/statutes/presdec … _1976.html), or the Subdivision and Condominium Buyer’s Protective Decree (as amended by PD 1216) [ http://www.lawphil.net/statutes/presdec … _1977.html ]

If the above will require to much of your time, at least retain legal assistance prior to signing any CTS (Contract to Sell) and making any deposit.

Thanks for taking the time to relate all of this  information ... I have a lot of homework to do before signing the contract on the lot/building we have agreed to have built.

I'm sure that many others who come across this forum thread will be delighted with the contributions that you and others have made. ☺

You are very welcome …….. so many other expats contribute to this forum in a very positive way and I am blessed and happy to add some positive help when I can.  Take care!

Here's my input based on my experience:

1. Is the price of a new house likely to increase over, say, the next 5 yeas or so?
No, the house itself "depreciates" over time. The value of the land is what appreciates. If you are after property value appreciation, try to look for properties in areas where the development is fast. Unfortunately, Baguio is a slow growth area compared to the metro and the surrounding area.

2. As a foreigner would I have any problems selling the house?
No, as long as you do everything legally

3. Are house-building guarantees meaningful here?
Yes

4. Anything else I should be aware of?
If you have the money and common sense, you'll be able to enjoy it here. Feel free to msg me if you have questions though.

Cheers

Thanks for the input uy.reginald (nice name!) ...

Dimps

Dimps,
If your thinking of reselling find a ready built house get it surveyed, then buy. I think if your going to build only do it if your staying long term. It's stressful building you have to watch everything and the builder has to pay his workers weekly from the money you pay him. They have you by the balls.
Dinky

Hi Dinky,
Thanks for the advice. I'm going to be applying for lifetime residency soon and have already given my balls to the builder!

But I trust him and he has a good reputation ... and I've been in the house he built next door which is top quality. I've also had a penalty clause added to the contract so I will have HIS balls if he is late completing!

An easier way is as long as your married, fly in with your wife and you get a one year visa, just nip over to S'pore if you have'nt got a long stay its alot cheaper.
As ;long as you have staged progress payments and advance the builder enough to pay his men weekly you should be fine. If your buying the materials, let your partner negotiate, otherwise as your a white man the price goes up. Another thing I learnt is that its a good thing to put something in the soil before you put down the ground work cementing to kill the insect life. They all seem to weld metal frame trusses to support the tiled roofs to combat termites. Avoid  wood skirtings as they get attacked first by woodlice, I have already experienced that. Good guttering is also important as when its rain its rains hard and adequate drainage is very important as some areas are prone to flooding. I would always advise to be slightly elevated from the normal surrounding ground level. Try and get the electicity supply pole connecting to one side of your house otherwise you have your view spoilt with a cable hanging across your house. Just think when buying anything make sure its termite proof.If you have the space I would also recommend having an extra water storage tank as last year we had water shortages, even incorporating a small emergency generator comes in handy, for air con and lighting..Have a gas cooker and some emergency lighting installed so the cooking does;nt stop. . If I had the money I would have also put in a splash pool surrounded by some shade or a cubo. Anyway just giving you some ideas.

dinky2408 :

An easier way is as long as your married, fly in with your wife and you get a one year visa, just nip over to S'pore if you have'nt got a long stay its alot cheaper.
As ;long as you have staged progress payments and advance the builder enough to pay his men weekly you should be fine. If your buying the materials, let your partner negotiate, otherwise as your a white man the price goes up. Another thing I learnt is that its a good thing to put something in the soil before you put down the ground work cementing to kill the insect life. They all seem to weld metal frame trusses to support the tiled roofs to combat termites. Avoid  wood skirtings as they get attacked first by woodlice, I have already experienced that. Good guttering is also important as when its rain its rains hard and adequate drainage is very important as some areas are prone to flooding. I would always advise to be slightly elevated from the normal surrounding ground level. Try and get the electicity supply pole connecting to one side of your house otherwise you have your view spoilt with a cable hanging across your house. Just think when buying anything make sure its termite proof.If you have the space I would also recommend having an extra water storage tank as last year we had water shortages, even incorporating a small emergency generator comes in handy, for air con and lighting..Have a gas cooker and some emergency lighting installed so the cooking does;nt stop. . If I had the money I would have also put in a splash pool surrounded by some shade or a cubo. Anyway just giving you some ideas.

Also, make sure that the shower floor is sloped properly to the drain to avoid standing water. You should also do this for terrace floors and roof decks.

I don't like running the generator when there's no electricity. I avoid the need to use it as much as I can. So, at our house, we have two gas tanks -- one in use and the other as reserve. So, if we run out of gas and  at the same time there's no electricity, we can still cook using the reserve, and just have the empty one refilled in the next few days. Both tanks are located outside the house and connected to a cooking range in the kitchen.

I would not recommend having a pool, unless perhaps you have had the experience of having and maintaining one. It rains a lot here. You'd have to check and adjust pH often. And then there are bugs and dust and all sorts of foliage accumulating in your pool.

Thanks for the tips Dinky and Fil ... all points duly noted!

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