Condo Buying in the Philippines

Interested to buy properties in the Philippines? Yes you may but you have to brace yourself as it is entirely a different scenario and processes compared to what we have here in the U.S. Yes, it is a very wise investment I should say.

I have wanted to buy a condo at The Fort Bonifacio Global City. My two sons who were based in Manila since 2008 and 2012 respectively work and train in the area. Very convenient for them since almost everything is walking distance. You know how bad traffic is everywhere so this is really a big factor. BGC as what they call it short for Bonifacio Global City is considered high end area that surpassed the status of Makati nowadays. The municipality of Makati once tried to claim a portion of BGC for this obvious reason. I want to kick myself for not buying at least one at that time when the pre-selling price was just a million pesos or two. Nowadays it is on a whopping 8.5 million pesos for a decent one bedroom with very small kitchen, bath and living room on a 40-square-meter floor plan.

I talked with a couple of realtors there and so confused with the process. The good thing is you can own a property there even if you are not a Filipino Citizen but with limitations. Getting a loan is another thing. No credit scores to pull as there is no such thing. If it is pre-selling; the building is being built and will be ready for delivery in the next 3-5 years. You will start with the down payment upon signing the contract to purchase with a monthly payment allocated on half of the total sales price payable in 5 years.

Let’s say you purchase a P5 million property, builders require about 5-10 percent down payment; (P250,000 and P500,000) then a monthly payment of about half of the sales price (2.5 million) in 60 months around 40k pesos a month. By the time the unit is ready, you can occupy the property provided you get a loan from the bank for the balance to fully pay the builders. At this point the loan and the monthly payment will be between you and the bank.

Buying an already built and ready to occupy condo is another thing. Sales price is much higher as it already gained equity. The appreciation is really good especially in that area. It is on a cash basis transaction as you have to pay the owner in full. Banks will not lend you money unless the condo is under your name and the only thing you can do that is if the unit is paid in full. It does not make sense as if the condo is already paid in full, why do you need to borrow from the bank? That is how they do it there. So, chances are you borrow money from friends, families or from your bank in here if bank will agree or put a collateral since the property is in the Philippines; then once it is paid in full and deed under your name, you can find another bank to loan you to pay what you have borrowed from families and friends. I know it is very confusing but you have to know the process in order to beat or go with the flow of the system.

The disadvantage is what if the builder goes bankrupt? There is no refund whatsoever. I also heard stories as you were paying for years only to realize the payment has not been reimbursed or the name of the owner is not you. This rarely happens nowadays as buying and selling properties in the Philippine especially with builders are much more structured and organized. Still be smart and beware. There may be other options and figures available but so far these are what I have encountered on my latest search.

Note: Jocelyn Porteria is a Realtor® licensed in VA. Top Producer of Fairfax Realty and earning Five-Star Reviews from her clients. She is a Certified Expert Negotiator and also earned a designation as an Accredited Staging Professional; ABR, Accredited Buyer’s Specialist; CDPE Certified Distressed Property and Short Sale Expert, For more info, visit her website at www.jprealdeal.com and on Facebook https://www.facebook.com/realdealconsulting. Call her at 571-432-8335 or email at realdealconsulting@yahoo.com for free confidential consultations.