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Time to invest in the Philippines

admin — Wed, 02 May 2012 05:30:54 +0000

Apparently, the Philippines is now a creditor instead of being the perennial debtor. According to Today Online, the country is now an IMF creditor to help European economies. That’s a good sign of a strong and growing economy ripe for property investment.

Here’s an excerpt from the article:

Whisper it if you will, but the Philippines may at last be getting its act together. These are early days. But there are definite signs that the country – with its young population of nearly 100 million people, the world’s 12th largest – has turned a corner.

First, the external position has improved dramatically. The Philippines, after years of indebtedness, is a net creditor. Overseas remittances from the roughly eight million Filipinos working abroad have steadily added to foreign exchange reserves. At nearly US$80 billion, these are higher than the external debt. Since 2004, remittances have grown from US$7 billion-US$8 billion to US$20 billion, nearly 10 per cent of GDP. The fact that so many people need to work abroad is a sign of the economy’s inability to generate enough jobs. But remittances are serving a purpose and have held up well since the financial crisis. The Philippines is emerging as a solution to the labour shortages of mature economies the world over.

Some jobs go the other way. Philippine call centres have grown exponentially, trumping those in India. Revenues from back office businesses have quintupled over six years from US$2 billion to US$11 billion.

Second, the country is getting its fiscal house in order. The deficit has narrowed from a worrying 5-6 per cent a decade ago to a manageable 2 per cent. The tax net was widened under the previous administration, though the tax take remains at a lowly 13.5 per cent of GDP. Spending has been kept in check.

Third, the political situation is vastly improved. Benigno “Noynoy” Aquino, elected President in 2010, has made a creditable start. For one, his government has sent out a strong message that it will not tolerate corruption (a distinct change from past governments, which actively encouraged it). Mr Aquino has instructed tax officials to go after evaders. A few big scalps appear to be doing the trick. The tax take has edged up even without necessary tax reform. The supreme court this week ruled that the huge sugar plantation belonging to Mr Aquino’s family must be redistributed among tenant farmers. The fact that a sitting President can be stripped of land is a hopeful sign that the separation of powers enshrined in the constitution is being honored.

The Aquino government has also taken steps to restore rice self-sufficiency after the country was forced to import a fifth of its needs in 2008. It has established public-private partnerships to build the roads, railways and power stations that have failed to keep pace with an exploding population. Progress has been slow, but the legal regime is considered solid. Many economists are predicting a private investment boom, predicated on favorable demographics – half of Filipinos are under 25 – and the healthiest banking system in South-east Asia.

But that view lags behind reality. In 2010, the economy grew at 7.6 per cent – faster than Indonesia, Asia’s investment darling. Growth has slowed, but it has cleared 4-5 per cent every year since 2006, apart from in post-Lehman 2009. Markets have not been oblivious. Last year, the Philippines stock market was the world’s seventh-best performing. In the year to date, the Philippine exchange is up more than 20 per cent, among the world’s top 10 performers.

So why not invest in the Philippines?

Peso Stability Makes for a Great Investment Opportunity

admin — Thu, 19 Apr 2012 13:01:52 +0000

The Philippine Daily Inquirer just released the news that the Philippine Peso has moved sideways after appreciating previously with a favorable potential performance over the short term.

The appreciation came from the latest World Economic Outlook of the International Monetary Fund which the IMF expects the Philippines to grow 4.2 percent this year and by 4.7 percent in 2013.

This is good news to potential investors planning to buy properties in the Philippines.

Invest in Philippine Real Estate

admin — Wed, 18 Apr 2012 08:15:22 +0000

The Philippines is consistently growing rapidly in economic terms. The rapid increase in Business Process Outsourcing (BPO), Call Centers and other businesses have helped push family income to higher levels. The Philippines has overtaken India in some sectors of the global outsourcing market.

The number of Oversease Filipino Workers (OFW) is also constantly growing. Remittances from Filipinos abroad have grown by tens of billions of dollars annually.

An ongoing demand for real estate is expected to sustain a continued growth of the real estate industry. A number of real estate developers have multiple projects in the works for this same reason, while property prices are steadily rising in line with increasing demand. All the more reason properties are a great investment.

Aside from positive economic indicators, there are other factors making it ideal to invest in Real Estate in the Philippines. One reason is tropical weather. While the rest of the world experiences negative temperature and a much more negative economic growth, the rich archipelago that is the Philippines continues to enjoy a warm, sunny climate that is ideal for any type of activity—for work, traveling, starting a family or even retirement.

Conservatism is another factor to consider. The banking and property sectors have instituted safety nets that reduce risks, established systems that filter out subprime buyers and applied the lessons learned from the recent US property market crash.

Invest in Philippine Real Estate. It’s the best kept secret of the decade.

Property Investing and Retiring in the Philippines

admin — Tue, 17 Apr 2012 08:53:37 +0000

Moving to retire in another country is an attractive option which has been successful in the past with Spain, Portugal, Mexico and Puerto Rico being among some of the more popular destinations. The Philippines is becoming more and more attractive. The growth of property investing opportunities is the icing on the cake.

The Philippines offers a lower cost of living. The Philippine Peso exchange rate is approximately 42 to 1 USD or 70 to 1 GBP. Housing, food, and labor costs are quite reasonable. A One bedroom condominium can be purchased for less than 100,000 USD or GBP 55,000. One can dine out on average at a three star restaurant for less than 1000 pesos or 20 USD. A private driver’s salary is approximately 12,000 PHP a month, while a housekeeper earns approximately 6,000 monthly. Salaries are even lower if you live in the provinces.

Cable Television, internet and mobile Communications are cheap, as with most everything else. If you have a retirement income in the region of $1,500 to $2,000 per month (70,000 to 90,000 pesos) you can live quite well in the Philippines.

The Philippines offers affordable real estate and good investment opportunities for those seeking a retirement haven. If you have 60,000 USD or 35,000 GBP to invest, here are some buys you could make right now.

Unlike other offshore rental properties, where the rental market is largely seasonal, in the Philippines there is a strong market for rental properties all-year round. This gives buyers greater flexibility in choosing when to use and when to rent their property. The strong rental/second home market also has resulted in a proliferation of professional property managers and rental agents, making property ownership and rental easy.

Financing Options and Security open up Philippine real estate market to International buyers. Previously a stumbling block for some international buyers was the perception that it is difficult – to obtain financing in the Philippines. But with new safeguards and incentives in place, these are no longer a problem.

Philippine real estate, medical, social services, and employment agencies are now working together under the government’s Philippine Retirement Authority (PRA) to set up standards and make the retirement industry truly world class.