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Seeking advice on buying a condo unit in Cebu


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Hello,

I want to purchase a condo unit in Cebu or Dumagerte and I have got a few questions:  

1. What is the best way to buy a condo unit: through a real estate agent or directly from a developer?

2. Which developer would you recommend most as a reliable developer?

3. Foreigners can buy up to 40% of condominium units. How can I know if I am within the 40% when buying a second-hand or new-built condo unit? 

4. What is the average rental yield? Is it a good investment, in your opinion, at the moment?  

5. Is it difficult to find tenants? 

6. Is it difficult to re-sell?  

7. Is it better to rent or purchase a condo for a long term? Just need to know your opinion. 

8. How much time does it take to complete the whole procedure of purchasing? 

 

Great thanks and much appreciated, 

 

 

 

Edited by Adam
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Headshot

I don't own a condo, but I do own a house here. Therefore, I can't answer all of your questions, but I can answer some. I will answer them out of order...

4 hours ago, Adam said:

7. Is it better to rent or purchase a condo for a long term? Just need to know your opinion.

Rent until you are absolutely sure that you want to live here for the rest of your life. Why?

4 hours ago, Adam said:

6. Is it difficult to re-sell? 

It is way more difficult to sell property in the Philippines than it is to buy it. One reason is there is no Multiple Listing Service (MLS) in the Philippines. For that reason, it is very difficult to advertise your property to get it to where potential buyers will see it. Another reason is that (because there is no MLS), sellers have no idea how to value their property. This results in an overinflated prices that buyers aren't willing or able to pay and sellers who won't budge on price (because they heard about somebody else who sold a similar property for that amount). The result is a very confusing market.

5 hours ago, Adam said:

1. What is the best way to buy a condo unit: through a real estate agent or directly from a developer?

If you decide to buy property anyway, then at least stay away from developers and real estate "agents". Developers sell their developers sell their units long before the building is complete (and even before work is started on the development). That almost guarantees that you will be waiting for years before the condo is ready to move into. As for agents, every cab driver and tricycle driver in the country is an "agent". It means nothing here. Agents normally get (or try to get) a commission from the developer or owner of the property, but they often get stiffed for the commission. If you really want to buy a condo for the best price, and you want to move in right away, then look for condo owners who NEED to sell their property for whatever reason. They are much more likely to come down on price.

5 hours ago, Adam said:

5. Is it difficult to find tenants?

If you are looking to buy, but rent it out when you aren't in the Philippines, don't. It will just become a money pit and a headache for you. You can't properly control the property from another country, and anybody you hire here to manage the property will likely just take your money without any benefit to you. This isn't your home country. You have very little in the way of legal protection here.

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18 minutes ago, Headshot said:

This isn't your home country. You have very little in the way of legal protection here.

There was a LinC poster recently who was told that he could rent his condo out when he bought it but when he did so was advised that he had violated his purchase contract.He was then told he had to pay off the balance owed in 30 days or forfeit everything.

Not sure how this ended up but it probably wasn't pretty.

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There was a LinC poster recently who was told that he could rent his condo out when he bought it but when he did so was advised that he had violated his purchase contract.He was then told he had to pay off the balance owed in 30 days or forfeit everything.
Not sure how this ended up but it probably wasn't pretty.
I may be wrong ..but didn't that just relate to doing short term rentals i.e AirBnB ?
And that would be a policy invoked by the owners/body Corp , not a law.

Sent from my Mi A2 Lite using Tapatalk

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15 minutes ago, Gus said:

I may be wrong ..but didn't that just relate to doing short term rentals i.e AirBnB ?

Don't recall the AirBnb connection but it certainly could have been.

Seem to recall that the owner wanted to rent to a friend for a couple of weeks.........would have to look the thread up to be sure.

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Found the thread. Original post.

 https://www.livingincebuforums.com/topic/113555-problem-with-developer/?tab=comments#comment-1548719              

Quote

Hi everyone. I plan to live in Cebu from next year and bought a condo at the beginning of the year with a 5% downpayment, move in fees paid, and inhouse finance for the balance. This was the agreement to allow me to move in. I decorated the condo and furnished it and initially had plans to rent it out before I moved there. After initially being told by the sales woman that would be ok, later the developer changed their mind and informed me to stop my rental business. It was not a rental business as such as I had only had one friend of a friend stay there for a few weeks. So anyway I cancelled my rental ads on the various websites and informed the developer of this. I was there in June and asked if I could discuss the matter with a manager. Unfortunately there was no one available for the whole 8 days I was there. Convenient. When I returned to Australia I received a letter of demand via email demanding full payment of the contract within 4 days. I have not defaulted on any of the monthly repayments yet the developer saw fit to send me this demand. When I contacted them on email many times they failed to respond. No one will discuss. Then early this week they email be a notarised cancellation of contract effective 30 days from receipt of the letter. Again they will not respond. I have contacted many lawyers in Cebu via email or websites but those that have responded advise there would be a conflict of interest. Most do not respond. I don't see how the developer can just cancel my contract and take possession of my condo if I have not defaulted and have complied with their after contract condition of non rental of the condo. I am worried without legal represantation I will lose the condo. Can anyone suggest an attorney who will respond and help me with this situation? The developer is Bamboo Bay Community (Contempo Properties and Development).

 

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smokey

Dont rent it out if you are going to live in it fine.  If your going to brrow the money cnsider taking a personal loan in usa probably better interest ...  Remember if you buy it for 6 million stay 2 years sell it for 2 million you still pay tax

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8 minutes ago, smokey said:

Dont rent it out if you are going to live in it fine.  If your going to brrow the money cnsider taking a personal loan in usa probably better interest ...  Remember if you buy it for 6 million stay 2 years sell it for 2 million you still pay tax

Can it really depreciate that much? From 6 million down to 2 million within just 2 years? Or it is just a metaphor. Has anyone had an experience like that? Re-selling  at such a low price? 

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smokey
1 hour ago, Adam said:

Can it really depreciate that much? From 6 million down to 2 million within just 2 years? Or it is just a metaphor. Has anyone had an experience like that? Re-selling  at such a low price? 

Ask our member from davao

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smokey

I have a house i spent about 14 million to build in 2005 and added to change it add room add garage i turned it into a house with two attached rentals and collect 53.000 month so total in say 18 million peso value today about 11 million.    My advice if you can buy it do so live in and in a few years hopefully get most of your money back

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2 hours ago, smokey said:

Remember if you buy it for 6 million stay 2 years sell it for 2 million you still pay tax

I believe that Smokey is speaking of capital gains tax here.

In the PI the seller normally pays capital gains tax (6%) after a sale of their house.....even if they LOST money overall in the transaction.

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33 minutes ago, Bama said:

I believe that Smokey is speaking of capital gains tax here.

In the PI the seller normally pays capital gains tax (6%) after a sale of their house.....even if they LOST money overall in the transaction.

No. He is talking about the real estate market in the Philippines. If you buy anything new, you will likely never get your money back out of it. Even if you get offers, they will probably be low ball offers (by people who are hoping to turn a quick profit on your loss. It is very common here because it often works with sellers who actually NEED to sell a property to pay emergency expenses. People go around looking for sellers who NEED to sell, and then offer half or less of what the property cost new. If you do get your money out of a property here, it is because you were very lucky to have the right buyer (probably a foreigner or OFW) come along at the right time. Taxes are a whole other issue. What they call "capital gains tax" here is actually a sales tax (based on the sales price rather than on any actual gain on your original investment). On top of that, there are also other taxes heaped on.

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smokey

The only good i see in my house is i get to live here and collect rent same time .my way of looking at it is when i came here 2004 i rented 35.000 month now 14 years later if i was still renting i spent a min of 6 million peso so now even i sell 11 i broke even and now i have rental that in 10 years is another 6 million so maybe i will make a little profit.  To op rent or buy to live in

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RangerUp
4 hours ago, smokey said:

If your going to brrow the money cnsider taking a personal loan in usa probably better interest ..

Question related to that: If you buy a condo you can pay in cash, or you can take out a 20 year mortgage.

If you go the mortgage route, and then one day you decide to pay the remaining amount in cash, what will the response be?

1) not a problem sir, pay the remainder and your contract is settled.

2) sorry sir, the contract you signed is monthly installments for the next 18 years.

 

 

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