Real Estate Buying Guide in the Philippines for Foreigners

Foreigner's Guide

By law, foreigners don't have the right to acquire land in the Philippines (there have been many proposals to amend this law but of this writing, it is unlikely to change). The simplest way for a foreigner to acquire real estate properties is to have a Filipino spouse purchase a property. Another alternative is having a Filipino partner when acquiring a property. The partner owns 51% or more and the remainder is owned by the foreigner. (Tip: The foreigner can have a blank deed of sale signed by the Filipino partner for security). 

Exceptions:

Filipino citizens and corporations or partnerships that is at least 60% Philippine owned are entitled to acquire land in the Philippines. An exception to this rule, is foreign acquisition of a Philippine real estate in the following cases:

  • Acquisition before the 1935 constitution.
  • Acquisition thru hereditary succession if the foreign acquire is a legal or natural heir.  This means that when you are married to a Filipino citizen and your husband/wife dies, you as the natural heir will become the legal owner of his/her property. The same is true for the children. Every natural child (legitimate or illegitimate) can inherit the property of his/her Filipino father/mother even if he/she is not a Filipino citizen.
  • Purchase of not more than 40% interest in a condominium project.
  • Purchase by a former natural-born Filipino citizen subject to the limitations prescribed by law.  (natural born Filipinos who acquired foreign citizenship is entitled to own up to 1,000 sq.m. of residential land, and 1 hectare of agricultural or farm land)
  • Filipinos who are married to aliens who retain their Filipino citizenship, unless by their act or omission they have renounced their Filipino citizenship.
  • Owning of houses or buildings is legal as long as the foreigner does not own the land on which the house is build.

Setting up a corporation with 40% of the stocks in the foreigner's name and 60% to Filipinos is a good alternative. There must be a minimum of 5 stockholders, and foreigner can have the Filipino stockholders sign blank transfer of the stocks for security.

Foreigners Married to a Filipino Citizen

If holding a title as an individual, a typical situation would be that a foreigner married to a Filipino citizen would hold title in the Filipino spouse's name. The foreign spouse's name cannot be on the Title but can be on the contract to buy the property. In the event of death of the Filipino spouse, the foreign spouse is allowed a reasonable amount of time to dispose of the property and collect the proceeds or the property will pass to any Filipino heirs and or relatives.

Any natural-born Philippine citizen who has lost his Philippine citizenship may still own private land in the Philippines up to a maximum area of 5,000 square meters in the case of rural land. In the case of married couples, the total area that both couples are allowed to purchase should not exceed the maximum area mentioned above.

Foreigners Leasing of the Philippine Real Estate Property

Leasing land in the Philippines on a long term basis is an option for foreigners or foreign corporations with more than 40 percent foreign equity. Under the Investor's Lease Act of the Philippines a foreign national and or corporation may enter into a lease agreement with Filipino landowners for an initial period of up to 50 years renewable once for an additional 25 years

Disclaimer: We try our best to give accurate information on this site. We however could not be held legally liable for its contents. This serves only as a guide for general reference.