How Can Foreigners Buy Property In The Philippines

Posted in Real State 10 months ago

Buying properties in the Philippines has become a trend for foreigners these days due to several factors like culture, hospitality, the friendliness of Filipinos, and the country’s tropical climate. 

Aside from that, the Philippines offers great opportunities for investments, not to mention the low cost of living in the country. 


Things To Consider in Buying Property 


One of the biggest things to consider is choosing the location you want to live in. Do you prefer the active ambiance of the city? Or do you enjoy the peace and quiet of small towns?  

If you consider being in the center of it all, Manila which is the capital city of the Philippines is the best option. 


You might also consider Quezon City a good choice as it is the country’s biggest city.  The City of Davao is also one of the country’s centers of tourism, as well as Cebu City. These cities along with other major cities in the Philippines offers advantages for authentic restaurants, nightlife, and other entertainments. They also have easy access to schools and healthcare facilities. 


But, the downside of living in these major cities are the congested traffic and the huge crowd. 


If you are seeking less crowded places, a small town like Tagaytay would best fit the preference. It is one of the most popular destinations for both foreign and local tourists. It is also one of the country’s summer capital because of its cooler climate. In addition, it is about an hour to two away from Manila. Next on the list is Angeles City in Pampanga and Subic Bay Freeport Zone since they are both populated by expats.  


Transaction Fees

Property transactions always involve a considerable amount of fees. Expect to pay the following: 

  • Capital Gains Tax which is normally paid by the seller. But in some instances, the buyer pays it. It is 6% of the residence’s sales price, zonal value or fair market value.
  • Documentary Stamp Tax is 1.5% of the sales price, zonal value or fair market value.
  • Transfer Tax is 0.5% to 0.75% of the sales price, zonal value or fair market value. However, it depends on where the property is located.
  • Title Registration Fee differs according to the registration fee table, but it is roughly about 0.25% of the sales price.



Another important thing to consider is your safety. Like any other place in the world, the Philippines isn’t perfect. Foreigners and even locals can come across trouble from time to time. That’s why it is always necessary to consider places that are not included in a “Travel Warning” list.  

Foreigners Can Own a Property Only If:

  • The property to be acquired is under the 1935 Philippine Constitution.
  • The property is acquired through hereditary succession. This means that a person who is not Filipino inherited the property which was acquired under the 1935 Philippine Constitution.
  • The property was bought when the owner was still a natural-born Filipino citizen.  But, it is subject to the restrictions provided by law.
  • Former natural-born Filipino citizens ownership of an urban land must be limited to 1,000 square meters. While the rural land must not exceed 1 hectare. And it must be used for residential purposes according to the Batas Pambansa 185.
  • Natural-born Filipinos who lost their Philippine citizenship to another country because of naturalization may regain their Filipino citizenship after swearing allegiance to the Philippines. After reacquiring the Philippine citizenship, they are again considered citizens and may own real property without any constraints.
  • Foreigners may own houses or buildings but not the land where the structures are planted. They can only rent a Philippine land for 25 years which can be extended to another 25 years. They can also form a corporation with Filipino partners where the corporation can legally purchase the land. However, foreign ownership should not exceed 40%.


How Can Foreigners Buy a Property in the Philippines 

1. Apply for an SRRV

Foreigners who want to retire in the Philippines should get a Special Residence Retirees Visa (SRRV) issued by the Bureau of Immigration of the Republic of the Philippines. It grants the holder multiple-entry privileges and the right to stay permanently or indefinitely.


2. Research for Expat-Populated Areas

In Metro Manila, Makati, Parañaque, Quezon, and Taguig are expat-populated cities. As well as Cebu, Angeles City in Pampanga and Subic Bay Freeport Zone. 


For cities in Manila, the convenience for location, secured communities, and family-friendly establishments are considered by foreigners. Whereas both Subic and Angeles were former U.S. military installations that have retained the American suburban ambiance. 


3. Check Properties Online

Check out the property listing platforms online where you can view several properties for sale or rent in the Philippines. The listings include important details you might be looking for in a property. 


4. Work with a Licensed Real Estate Broker

Find a broker who has strong professionalism. Someone who has connections and knows about the property that would suit your needs.


5. Be aware of Rules

It is always better to know the rules beforehand to see if you can comfortably abide by all of them. 


6. Check the Sellers Identity

Verify if the Seller is the true owner of the property by asking for the original copy of the title. Also, compare it against any of their valid government-issued IDs. 


7. Check if the Title is Clean

Check for annotations on the title to ensure that the said property is free of encumbrances.