February 1, 2025
Purchasing real estate in Manila requires careful planning, verification, and due diligence, whether you are a first-time buyer, a foreign investor, or an experienced property owner. The city's property market continues to grow, offering various investment opportunities, from high-end condominiums to strategically located commercial spaces.
To ensure a smooth and secure transaction, here are the key points you need to consider before buying real estate in Manila.
1.Understanding Foreign Ownership Laws
Foreigners are generally restricted from owning land in the Philippines, but they can still invest in property through condominium ownership, leasehold agreements, or corporate ownership. Foreigners can own up to 40% of units in a condominium building. They can also lease land for up to 25 years, with an option to renew for another 25 years. Alternatively, a domestic corporation that is at least 60% Filipino-owned can legally own land, allowing foreign investors to have indirect ownership.
2.Verify the Authenticity of the Land Title
A property’s Transfer Certificate of Title (TCT) is a crucial document in real estate transactions. Request a Certified True Copy from the Register of Deeds in the city or municipality where the property is located. Ensure the title number and owner’s name match those provided by the seller.
3.Ensure the Title is Clean and Free of Encumbrances
Check the “Encumbrances” section on the back of the title. If this section is empty, the title is considered clean. A property with pending legal claims, liens, or mortgages can result in financial liabilities for the buyer.
4.Confirm the Property Matches the Title Description
Manila real estate titles do not indicate street names or addresses. Verify that the actual property aligns with the title’s description by hiring a licensed land surveyor or geodetic engineer. This ensures that the property boundaries and location are accurate.
5.Verify the Seller's Identity and Ownership Rights
Ensure that the seller is the legal owner by requesting valid identification, such as a passport or driver’s license, and verifying ownership history with neighbors or local authorities. Be cautious of fraudulent transactions involving misrepresented ownership.
6.Check if Real Estate Taxes are Up to Date
Property owners in Manila must pay real estate taxes annually. Request the latest Tax Declaration and Tax Receipts to confirm all dues are settled. Unpaid real estate taxes could result in additional expenses for the buyer.
7.Avoid Special Power of Attorney (SPA) Sales When Possible
A Special Power of Attorney (SPA) allows a representative to sell property on behalf of the owner. While legal, this practice is sometimes exploited for fraudulent sales. If an SPA is involved, verify its authenticity with the issuing notary public and, if possible, confirm with the property owner directly.
8.Secure a Right of Way for Landlocked Properties
Some properties, especially in suburban and rural areas, lack direct access to public roads. Ensure the property has a legal right of way to avoid costly disputes or additional purchases of access rights.
9.Understand the Steps to Buying Property in Manila
Working with a trusted real estate agent is essential, as they help navigate listings, negotiate deals, and manage paperwork. Buyers should explore listings online, visit property expos, and consult agents to find the right condominium, townhouse, or commercial space. A Letter of Intent (LOI) expresses commitment to purchasing a property, outlining key details such as price, deposit, and due diligence period. Conducting due diligence, including verifying ownership, checking for liens, and reviewing zoning restrictions, ensures a safe transaction. Once due diligence is complete, the buyer and seller sign the Deed of Absolute Sale in the presence of a notary, and the buyer pays the remaining amount before transferring the title under their name.
10.Be Aware of Costs and Taxes When Buying Property
In addition to the purchase price, buyers must prepare for several additional costs, including a transfer tax of 0.5%–0.75% of the property’s sales price, a title registration fee of approximately 0.25% of the total sales price, and a documentary stamp tax of 1.5% of the property’s value.
11.How to Find Properties for Sale in Manila
Given Manila's booming real estate market, finding the best property requires multiple strategies. Real estate agents offer expert guidance and access to exclusive listings. Online property platforms provide updated listings of residential and commercial spaces. Foreclosed property listings present potential investment opportunities at lower prices.
12.Manila's Real Estate Market Trends in 2025
The property market in Manila has shown significant growth in 2025, driven by strong economic expansion and high demand. There has been an 18% increase in property prices, with luxury properties in high demand. The average price for high-end condominiums is $3,000 per square meter. Infrastructure investments are improving accessibility and boosting property values.
13.The Rise of Luxury Housing in Manila
Manila is emerging as a global luxury real estate hotspot. Prices for high-end homes have increased by over 20% year-over-year, with developers focusing on million-dollar properties catering to affluent buyers.
14.Foreign Investment and Economic Outlook
International investors are showing growing interest in Manila's real estate sector due to its strong performance and stable economic conditions. The country is projected to see a 6% GDP growth, strengthening investor confidence. However, inflation at 5.4% may influence mortgage affordability and interest rates.
Is It a Good Time to Invest in Manila?
Manila remains a profitable real estate market with opportunities for local and foreign investors. While foreign ownership laws remain strict, condominiums and leasehold agreements provide viable options. With rising demand, increasing prices, and strong economic conditions, now is an ideal time to explore property investment in Manila. However, buyers should conduct thorough research and seek professional legal guidance to ensure a smooth and secure transaction.
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