This is the conclusion of my latest series on owning your own home in the Philippines.
I know, I know many are saying, Thank Goodness, thought he’s never shut up ;-). But I also know some of your are very interested in the subject, and it’s also a topic that many foreigners (and even some Filipinos) are not very knowledgeable on. You can read the rest of the articles here:
Owning Your Own Home — in the Philippines
Owning Your Own Home — in the Philippines — Part 2
Owning Your Own Home — in the Philippines — Part 3
Owning Your Own Home — in the Philippines — Part 4
Owning Your Own Home — in the Philippines — Part 5
Suggest you go through them first if you are just joining the series here, as I’m going to move right into the present subject … why, after years of advising people not to buy a home here, and even offering up a lot of reasons why it can be a bad economic idea, yours true just bought his own home here in the Philippines.
Dave Bought In
Seems like Dave sold out. Or “bought in” as the case may be. It’s true. I jumped the broom and now have my name on the title of a cute little three bed, one bath single story concrete “bungalow” style home in Marilao, Bulacan, (Luzon), the Philippines.
Why? pretty simple. My wife and I are happy here because:
- The location is very good (for us)
- It was a decent price in today’s market.
What it is not is:
- Our dream home
- An ideal deal
- Or, Not, for sure, an investment.
As I covered in some detail already, unless drastic changes in the rate of real estate appreciation happen, or my landlord were to sell to someone else (or the landlord might have wanted me out to let his children live there, thanks for that one, Paul), Mita and I would have been money ahead to keep renting for as long as 30 years.
But money, especially ‘future money’ isn’t everything, especially when you’re already 65, like me.
How Did We Take Title? Just to make things clear, from the git-go, when I say “we” bought this house, what I really am saying is shorthand for “my wife bought this house”. My wife is a dual US/Philippines citizen, so she has unrestricted property ownership rights under the Philippine Constitution. She was born in the Philippines of Filipino parents.
(Unlike the US, it’s not her birthplace that made her a natural-born Filipino, but her parentage. Being born in the Philippines does not convey Philippines nationality.)
She emigrated to the US, became my wife and earned her US citizenship. By doing so, she lost her Philippine nationality, but not all her property tights. As a “former Filipino) she still had rights to purchase limited amounts of urban and agricultural real estate.
(See a good summary former Filipino property rights here, it’s a question I get asked, often.)
Instead of exercising her former Filipino rights, my wife chose to reacquire her Philippine citizenship (under the provisions of RA 9225). This action completely restores the property rights she was born with. Therefore, she can buy any property she wants to, in the Philippines.
Now, of course, it’s not as if I have zero interest in the property. My name is on the deed. In the unlikely event my wife should pre-decease me (die first) , as her legal (compulsory) heir, I would inherit my share of the property. I could live in the property and enjoy the rights of ownership as long as I wished … the only restriction imposed by me being a foreigner is, I could only sell the property to someone entitled to own Philippine property under the constitution. Enough morbid thoughts.
What Did We Pay? Well now that’s a bit personal, isn’t it? But then again, this is PhilFAQS where you get the unvarnished truth about living in the Philippines, straight from the horse’s mouth with no shilly-shallying.
Two million. Pesos, that is. Right at $5,000 $40,000 USD at today’s going rate. I know the price was fair for this area and for this particular house, because we are in a community of several hundred houses, all built at the same time by the same builder. And I have a close relative whose been an officer in our local Home Owner’s Association for 20-plus years and knows about most every sale that has happened, or even been contemplated.
How Did We Pay? Mita and I decided the best rate for us was to pay half down in cash and mortgage the rest. So that’s the route we took. Aside from the fact that we didn’t want to draw our savings down too low, the other strong reasons we went with a formal bank loan were:
- I wanted to build up or Philippine credit history. There are no comprehensive credit reporting agencies here, as there are in the US, no FICO scores or any of the stuff folks in the US are familiar with. History and performance are everything, and we already had a paid-off car loan with our bank, so we went with the formal mortgage process.
- There’s an excellent chance we are going to invest in major add-on’s and renovations to this house in the near future. Since we already have a loan in place it will be (relatively) simple to present the bank an approved renovation plan and simply add-on or remake the loan.
- As you can tell from some of my previous articles, I’m very leery of the whole Philippine property ownership and titling process. the property we bought has about as clean a title as you can get, we bought from the original property owners. But still, I wanted as much protection I can get, and the bank is very careful with their own money … they have good lawyers … and they know all the tricks. How many people might care deeply about protecting my money and property interest, but I guarantee the bank cares about their money, so part of the fees and interest rate I pay the bank comes back to me as a real service.
That’s The Story So Far
So that’s pretty much where we’re at today. We’ve had closing, the buyers have their money transferred to the US, our names are on the deed (along with the bank’s as the mortgage holder), our names are on the tax rolls (about 1400 pesos (about $32 USD)per year total property taxes), we were already living in the house, so moving didn’t enter into the equation … and we’re happy and good to go.
So that’s the summation of this current crop of buying your house in the Philippines articles.
Be sure to let me know in the comments what questions you have that I didn’t cover in the by your own home series, or what else you want to know about the tips and tricks and pitfalls of buying your own home here in the Philippines.