Investing millions in real estate in the Philippines but not even seeing a glimpse of the property?!

Investing in real estate in the Philippines is a well-discussed topic.

Recalling a previous instance, a client once approached me with a concern: "The agent assured me that I could occupy the property after paying the deposit and down payment. However, despite making installments for several months, I'm still unable to move in. Now, they're stating that I need to show ten million in my bank statement. Is there something wrong?”

Legal assistant inquired about the details of the contract and payment receipts from the client, found out that they had only a deposit receipt! Further investigation revealed that there were more buyers who purchased based solely on the unit number!

There are even more buyers who have paid for the property but cannot transfer ownership. After purchasing, the property management requests various fees, then find out that the developer's internal system has no record of the purchase... and such incidents goes on.

What's worse is that currently, due to the developers' staff working from home, it is impossible to directly verify from the internal system! Due to information asymmetry and negligence in transactions, investors are losing millions, or even billions, and resolving it through legal procedures requires a great deal of effort. This investment is truly not cost-effective!

So, when delving into real estate investment in the Philippines, it's vital to steer clear of potential pitfalls and carefully consider key aspects. Allow us to guide you through the critical points to be mindful of.

Numerous international investors often make investment decisions solely based on agent videos, which might lead to information gaps. If possible, it is highly advisable to undertake an on-site inspection.

While agents’ videos may showcase the property's layout design, but they often fall short in revealing critical structural details and the surrounding environment. In such cases, it is recommended to proactively seek comprehensive building information from the agent or developer. This includes insights into the materials utilized, shared space design, and overall building safety.

When investing in real estate in the Philippines, many people may overlook the issue of the property's orientation. Nevertheless, we firmly believe that the direction in which windows face and the overall orientation of the property are significant considerations. This is because a favorable view can profoundly influence one's mood. Even if the property is not intended for personal use, a positive orientation can serve as a valuable asset for potential future rentals.

Additionally, during the purchase process, it is essential to communicate your preferences regarding the location, the number of rooms, and the preferred floor level with the agent or developer. In the case of acquiring a second-hand property, thorough verification of the property information is crucial. 

In the Philippines, it is common for developers to empower real estate agents with negotiation authority. Consequently, once you have chosen the unit and finalized payment details, you can engage in negotiations with the real estate agent to arrive at a mutually agreeable final price.

In addition to the deposit, down payment, and subsequent payment methods, make sure to confirm the specific costs to be borne after the property is handed over, such as property management fees and property taxes, to avoid future disputes and legal issues arising from misunderstandings or confusion.

Note: The payment methods for purchasing property in the Philippines not only depend on the developer, but the applicable payment methods also vary in different regions.

Sales contracts are generally lengthy, which is why most buyers don't read them carefully. In our discussions with clients, we have encountered situations where clients were unaware of the contract details.

Failing to read the contract is a significant error that must be avoided. The property purchase contract meticulously outlines all the initially agreed-upon conditions, and it is imperative to thoroughly review and address any concerns before signing. Signing the contract signifies acceptance of all the stipulated terms.

If possible, sign the property purchase contract at the developer's office. If buying a second-hand property, consider having a lawyer accompany you for security.

We have encountered clients who faced problems without having a property purchase contract on hand. This situation is extremely disadvantageous for the buyer, as it lacks the most basic document proof.

Therefore, before signing the contract, it is essential to understand the subsequent property purchase process. Any payment, whether to the developer or the seller of a second-hand property, should be accompanied by a receipt clearly indicating the buyer's name, details of the payment, and the date.

In conclusion, I have consolidated all the essential points to consider for property investment in the Philippines: 

1. Thoroughly confirm all information related to the purchased property, ensuring no details are overlooked. 

2. Obtain the property purchase contract and ensure its legal effectiveness. 

3. Every payment made should be accompanied by a detailed receipt, clearly outlining payment specifics for comprehensive documentation.

Every payment made should be accompanied by a detailed receipt, clearly outlining payment specifics for comprehensive documentation.

If you encounter challenges or language barriers during the process, consider engaging legal assistance from us! By involving a lawyer, you can ensure the protection of your personal rights. The nominal cost involved in this proactive approach can potentially save you from future disputes, safeguarding amounts that could extend into millions or even tens of millions.

The real estate industry in the Philippines has experienced explosive growth in the past few years, making it a worthwhile investment destination, but returns and risks always coexist! As you embark on your confident investment journey in the Philippines, entrust FEILONG LEGAL to safeguard your rights!