Real Estate Philippines Compared to the Rest of Asia (as of February 16, 2010)
I read an article recently in Global Property Guide (www.globalpropertyguide.com) about the state of Real Estate Philippines compared with the other property markets in Asia. Fortunately, we’re quite attractive to foreign investors, but not exactly the best. Take a look at the table they have given below…
|Key facts for Asia|
|Key Cities||Gross Yield||Roundtrip Costs||Mostly borne by:||Rental Inc. tax||Capital gains tax||Investment notes|
|Ulan Bator||12.50%||5.70%||Seller||0.00%||0.00%||Good yields! No tax! But ugly city|
|Jakarta||11.27%||26.37%||Buyer||20.00%||0.00%||No – high roundtrip, much supply|
|Manila||11.23%||18.23%||Equal/Seller||25.00%||0.00%||No – high roundtrip costs, high tax|
|HCMC||9.43%||6.20%||n.a.||23.49%||Possibly…but credit crunch|
|Kuala Lumpur||8.91%||5.50%||Buyer||22.42%||5.18%||Good yields, costs low|
|Bangkok||7.97%||8.03%||Buyer||6.30%||0.00%||Good yields, credit expansion|
|Seoul||7.00%||22.08%||Buyer||3.38%||9.12%||No – high roundtrip costs|
|Phnom Penh||4.88%||8.44%||Seller||14.00%||15.00%||Yields low, but v high GDP growth|
|Tokyo||4.86%||8.51%||Buyer||3.40%||3.98%||Yields low except small units|
|Hong Kong||3.73%||2.77%||Buyer||12.16%||0.00%||Yields low|
|Taipei||2.38%||12.33%||Buyer||20.00%||21.11%||Yields v low, roundtrip costs med|
Also, from their analysis here (updated February 16, 2010): http://www.globalpropertyguide.com/Asia/#continent_analysis, they made a statement about the Philippines saying:
“Manila, Philippines. Good yields, but high round-trip costs (18%) and high income taxes if you are a non-resident foreigner playing by the rules (25%). Petty bureaucracy irritating, too.”
If you look at that article, you will see that Malaysia and Thailand are their best bets in Asia right now. We, the Philippines, are about a Second or Third Choice property investment, due to the reasons stated above.
For us locally-based Filipinos, high-round trip costs are not a problem since we are living here. We only have to content with our corrupt system of government. For Foreigners, they’ll have to deal with two challenges.
If only our Government would straighten itself out with a morally-upright and highly-capable leader. That indeed sounds far-fetched, given the choices we have in our upcoming May 2010 elections. And besides, that’s a different topic.
For now, let’s just stick to Property Investing. Hope this article helps you out in your Philippine Property decision-making
Tags: Global Property Guide