Acquiring Real Estate in the Philippines: The Laws of Property Ownership

Are you an expatriate wanting to purchase real estate in the Philippines? Or perhaps you’re a balik-bayan looking to retire in your homeland? Whatever situation you find yourself in, here are the ins and outs of acquiring real estate in the Philippines.

A French friend of mine recently told me about his plans of opening up a restaurant here in the Philippines. He was wondering how he could own property without a Filipino citizenship.

As a rule, only Filipino citizens are entitled to own land in the Philippines. For corporations and partnerships, 60% of the capital should be owned by Filipino citizens.

However, there is an exception to the rule if 1) the acquisition happened before the 1935 Constitution, 2) a foreign acquiree is the legal heir of a Filipino citizen (ex. non-Filipino married to a Filipino citizen or natural child of a Filipino citizen) and 3) the purchase is not more than 40% interest in a condominium project.

Dual citizens are also granted full rights of possession of Philippine property.

It is interesting to note that foreign nationals or corporations can completely acquire a condominium unit or a townhouse in the country. However, if they want to purchase private land, residential or commercial houses or lots, then they have to form a corporation with Filipino citizens. This corporation should be a 40-60 deal: the foreign national can own only up to 40% of the income, while 60% (or more) goes to the Filipino partners.

Leasing is another option for those who don’t want to go through the hassle of forming corporations. Foreign nationals can enter into a lease agreement with a Filipino landowner for up to 50 years, renewable for another 25 years.

Need a listing of  real estate in the Philippines? Here’s a great site on Philippines Real Estates.