Why You Should Invest in Philippines Real Estate
"Investing in real estate is not only the best way, the quickest way, the safest way, but the only way to become wealthy."
The Republic of the Philippines, is a Southeast Asian country. It is an archipelago of 7,107 islands located in the western Pacific Ocean. Manila is its capital city. Hailed as Asia's rising star, the Philippines has seen massive growth in the past few years. With its active real estate sector, continued BPO investments and high remittances from OFWs (Filipino Expats), the country is on an upward trend.
Night view of skyline of Makati, Philippines
Investment outlook in developed countries and regions, including Japan, Western countries and the Middle East isn't promising, something the world witnessed in the debt crisis and the US Recession that began December 2007 and ended June 2009.
Developed nations, including the US, therefore, isn't a good place to invest hard earned cash; in fact, even blue chips, life insurance, government bonds and bank deposits aren't stable but only offer investors with negligible returns.
In this case, property market investments in emerging markets are becoming more attractive for investors because of the relative downturn in real estate in developed nations after the 2008 financial crisis because the focus now shifted from developed onto developing countries with established and rapidly increasing emerging market economies.
Emotional security and financial affluence—these are the main reasons to owning a home, a real estate property that cannot be carried away, lost or stolen. And real estate, purchased with common sense, paid in full and managed with care, is the safest investment you'll ever make. Now if you were deciding to invest in Philippine real estate, you might be wondering of its future and if it's okay to invest on numerous realty projects, including condominiums that have blossomed through the years.
Investing in Philippine's real estate is financially rewarding and here are few reasons why.
Political Stability
There will be no impeachment for President Noynoy Aquino. Despite left and right accusations of corruption and controversies, including disbursement acceleration fund and pork barrel fund, Philippine politics remain and will remain strong, according to political analysts. It's obvious that the democratic political institutions in the country are becoming stronger than before.
Huge housing backlog
One of the longstanding problems in the country is a huge demand (but short supply) for housing among 100 million locals. So without even saying, there is a continuing demand and strength in Philippine real estate, especially in regards to mass housing and midrange sector housing. Government leaders and policymakers, in this case, are expected to decide and make long-term mass housing loans and lower interest rates available. This is a growing need, especially among educators and teachers, soldiers and the military, professionals, farmers, factory workers and OFWs as well as other investors ready to buy their homes.
Economic stability
The Philippines is a fast-rising economic influence in the world; in fact, it has just achieved its "BBB Stable" credit rating, meaning the country has a sufficient capacity of paying its debts on time and in full. Having a "Stable" rating means that it has a strong outlook, which isn't to change within a year. This rating is predicted to increase in the next months due to the economic progress and reforms the country is experiencing, giving it a good, stable financial standing for potential investors for the years to come. (Gov.ph, Credit Rating as of May 8, 2014) Both archenemies Former President Gloria Macapagal-Arroyo and President Noynoy Aquino have worked for the long-term economic stability and growth of the country, which means better conditions for real estate investors.
Urban renewal
Due to both economic and population growth, most urban centers in the Metro and nearby, large provincial cities, are undergoing major urban redevelopments and renewal through both private developers (Ayala, Megaworld, Robinsons, SMDC and Filinvest) and local governments. By looking into this huge demand for housing, real estate investment opportunities may be promising for both local and foreign investors who want to cash in the growth of the country.
Infrastructure growth
Modernization in the infrastructure sector is predicted to accelerate, paving the way for higher optimism level in the real estate industry.
Increase in OFW remittances
Foreign exchange earnings from overseas Filipino workers are a huge cash inflow for the country and it remains stable. A part of an OFW's income is now placed on real estate investment aside from funding sari-sari stores and child education. Most overseas workers are now making wise decisions of investing on real estate properties, one of the main reasons local developers are sending their sales teams and setting up marketing offices abroad where a legion of Filipino workers are.
Rise in foreign investors and buyers
Economic and political stability, coupled by a relaxed and more affordable lifestyle in the country are reasons foreigners buy local condominium units. And according to experts, such positive trend will continue and this increase in foreign buyers that the country is experiencing at the moment has just started. To back this up, the country is reported to still] possess the lowest foreign direct investments among the ASEAN countries, including Cambodia and Myanmar.
Lower interest rates
Good prospects for value appreciation as well as stable rental incomes aren't the only reasons to invest on Philippine real estate but also on lower bank interest rates, opening the door for more families and professionals looking to buy real estate properties through housing loans. And because realty developers also have access to lower bank interest rates, they can also pass the benefit they get to buyers through flexible in-house financing offers and bank financing tie-ups.
Reputable Developers
Versus a few developers that toppled back in the 1997 Asian financial crisis, today's real estate developers are richer and stronger; thus, foreign buyers looking to cash in Philippine properties may be making the right move for profits.
Tourism
It's poised for sustained growth in the coming years. As a result, there is higher demand for new hotels, resorts, buildings and golf courses. But while the country's tourism is blossoming, it's still only a fraction of the already saturated tourism industry in neighboring Asian nations, such as Singapore, Macau, Hong Kong and Thailand.
Philippine Peso Stability
Showing a steady and strong appreciation, Philippine peso shows a good sign among foreign investors looking to cash in the booming economy of the country. It is in fact becoming more stable as compared to the weakening US dollar.
Rise in call centers and BPOs
Both are booming businesses in the country in which even the US President Barack Obama himself couldn't stop. That's result of our competitive edge and globalization. So aside from an increasing demand for office spaces and buildings, call center and BPO employees, who are among high income earners in the country, can also buy a piece of the land through real estate investment.
There you have the reasons to invest in the growing Philippine real estate. Study your options well and do your homework in terms of choosing the right developer in which to invest your money. And to make an informed decision, you may want sound advice from our professional real estate brokers. Call us up today!