How to Invest in Real Estate in the Philippines
2019 Jan 17
Why would you invest in real estate in the Philippines? Perhaps, you just want to get to your financial goals sooner. Perhaps there are other personal reasons. However, whatever they may be, real estate investment will require some research and the right mindset.
There are many catalysts driving the demand for condominiums and residential units as well as businesses that cater to the needs for these homeowners. Factors like providing housing for employees who want to live near their offices and strong remittances from OFWs, combined with the increasing urban population are just some of them.
For the investors, this increased demand of new residential and mixed-use projects both within and outside of Metro Manila provides them with plenty of good reasons to invest. Hence, if you’re planning in investing on real estate, keep the following information in your mind first:
- Before the internet became a huge part our lives, the only place to find real estate listings were at newspapers. Nowadays, real estate listings are conveniently posted online. You’ll even see them on Google or Facebook on a regular basis via broker postings or Groups. You need to know which are the go-to sites for properties to buy in the Philippines. Some examples include: Lamudi, Property24, ForeclosurePhilippines, and so on.
- While it can be exciting to own a high-end condominium unit, you can save that for future investment when you are financially capable to expand your horizons. In the meantime, as a novice, consider buying a property at a more conservative price that you can afford. You need to become an expert in one area, preferably an area that is near where you live, where you work, or any place that is near you. You cannot just say you want to invest in Metro Manila. The development of land and construction of roads beyond urban hotspots can be good indicators to predict potential increase in property value.
- Learn as much as you can about real estate investment. If you are going to invest in real estate, you will certainly enter into real estate transactions, so you need to familiarize yourself with the “ins and outs” of these transactions. If you’re venturing into real estate investment hoping that you’ll earn money easily, you might want to revisit your objectives. It’s also wise to connect with experienced investors so you can listen to their insights and get some pieces of good advice. For instance, the process where people buy derelict houses and then remodel them into something incredible is called “flipping.” This “buy-renovate-sell for profit” strategy is one of the many ways real estate can generate income either via rentals or straight markup from the original purchase price, and most of the time, you can only learn this from experienced investors.
- The rise in the number of mid-income families who want the convenience and perks of living in the metro is one of the main reasons that drove up the demand for condominium and apartment rentals in the last few years. Investors took advantage of this growing trend and doubled down on the purchase of these residential units for the sole purpose of rental income. This strategy opens up the doors of investing to regular folks who otherwise would not have the money up front to invest. Add the potential of ancillary profits to that mix, and the it starting to sound like a lucrative business. You must remember that revenue can be generated by micro-businesses located within or near your property.
- Our country is among the most popular tourist spots in the world. Cebu, Batangas, Pampanga, and Cagayan de Oro are just some of the most popular spots that receive thousands of visitors every year. Between 2016 to 2017 alone, the country posted an impressive 30.68% earnings growth rate in the travel and tourism sector, as reported by the DoT. Taking all these in consideration will greatly help you in choosing what kind of property to invest in, which location, what amenities to include, and so on.