Common things property seekers look for | Inquirer Business
Close  
INVESTING IN PH

Common things property seekers look for

/ 11:44 PM September 07, 2021
Metro Manila

In Metro Manila, investors quite often look for developments that are accessible or near transportation hubs and commercial areas.

For the past 18 months, it has been more difficult for foreign property investors to consider the Philippines as an investment location. This can be due to stringent travel bans, or the local GDP contraction.

However, there are still many foreigners who are keen on investing in the Philippines due to its economic track record and positive outlook once the economy recovers. In fact, for my company PropertyAccess, we were able to sell more than $80 million worth of Philippine properties over the last 18 months in retail transactions alone. This shows that foreign investors, or at least Japanese investors, are still interested in Philippine properties. So what are the common criteria for investing in overseas properties?

ADVERTISEMENT

Country information, demographics

The first elements savvy investors commonly check are the economic parameters and investment grading, to see if the country is still a safe place to invest in. Aside from the GDP growth, interest rates and other common economic parameters, foreign investors are also keen on checking the average age and urban population growth. The younger the average age is, the growth of the working population increases thus potentially increasing the demand for housing.

Investment return

There are a lot of risks that foreign investors look into when investing overseas, such as currency exchange rates, political and economic risks, tax regulations and other external risks. However, if the overseas properties offer high investment returns, these risks are worth taking.

FEATURED STORIES

For example, an investor can commonly expect up to 3 percent yield for a residential property in central Tokyo. For overseas investments, they usually look for at least double that yield. So to justify the investment, the yield must be at least 6 percent. Developers who offer guaranteed IRR with these numbers are even more likely to attract investors for their projects.

Reputable developers

Reputable property developers (either leading companies or boutique firms) are still the premium choices for foreign investors, since these are the ones that routinely deliver projects on time. However, based on experience, being a top company doesn’t automatically classify a developer as reputable, since there are some top developers who are notorious overseas for not finishing projects on time.

Location

In Metro Manila, investors quite often look for developments that are accessible or near transportation hubs and commercial areas. For example, our clients usually prefer properties that are accessible via the Metro Manila train stations.

Type of tenants

When studying the properties they are interested in, investors always research the type of tenants the property location will attract. Often, they check the average income of the working population in the area, or the type of demographics the nearby schools attract to see if they can afford the rent of the properties.

Read Next
Don't miss out on the latest news and information.

Subscribe to INQUIRER PLUS to get access to The Philippine Daily Inquirer & other 70+ titles, share up to 5 gadgets, listen to the news, download as early as 4am & share articles on social media. Call 896 6000.

TAGS: Business, foreign property investors, Investment, Philippine properties, property
For feedback, complaints, or inquiries, contact us.

Curated business news

By providing an email address. I agree to the Terms of Use and
acknowledge that I have read the Privacy Policy.



© Copyright 1997-2021 INQUIRER.net | All Rights Reserved

We use cookies to ensure you get the best experience on our website. By continuing, you are agreeing to our use of cookies. To find out more, please click this link.