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Building In The Philippines: The Lot

Building In The Philippines: The Lot

In 2014, we bought lot in Davao City, Philippines on which to build a house. In an area where lot sizes usually range from 100 to 300-square meters, our “more or less” 768-square meter lot is huge. It was part of a much larger parcel of land that belongs to a family who divided the parcel into smaller lots to pass to their family members. Our neighbors include two of the brothers, a sister and their oldest nephew.

A word about that “more or less” designation: that’s the actual wording in the deed.  There were two sets of boundary markers on the lot. One neighbor told us to use the small ones, the other told us to use the big ones. A surveyor was hired and now we use the big markers but, eh, they might be a bit off. Let’s call it 768, OK? In the U.S., such “close enough” measurements would  cause all sorts of problems, but here they’re the norm.

Finding A Lot

The most important thing you can do before setting out to buy a house/lot combo or buy land and build in the Philippines is to make a list of your needs and wants. Doing this will help you decide what’s important to you, what’s less important but still a want, and what’s not important at all.

This is how we looked at things:

Our List Of Wants And Needs

In Seattle, my wife Menchu and I lived in a basement studio apartment and then in a condominium unit. We were not living an expensive lifestyle. We weren’t involved in the simplicity “movement” but we shopped hard for all of our purchases, bought only what we truly needed and wrung the best value out of our dollars.

We knew that we wanted to keep that simplicity in our lives without moving out to the boondocks. We wanted to grow some of our own fresh fruits and vegetables. We wanted room to keep some chickens to give us meat and eggs. We wanted enough space to have a dog.

Davao is a city on the move. It’s becoming more crowded by the year and the city is spreading out. We knew that we were looking for an area that had larger lots but also an area that was growing enough that services it might lack would catch up with us later.

Privacy and security were important concerns. We looked at some planned communities and while they had gates and guards, the lots were too small. Living in that type of community would also mean that the fruit trees we wanted would have to be planted small and immature, taking years to bear fruit. Keeping chickens wouldn’t be allowed or, at least, not a very popular thing with the neighbors.

As we aged, we knew that we’d want hospitals, taxis and other conveniences to be nearby.

Our basic present needs and wants were:

  • an oversize lot
  • situated within the Davao City limits
  • accessible for construction crews and trucks delivering heavy construction loads
  • had some established fruit trees that would survive the necessary lot clearing
  • in an area that was growing
  • privacy and could offer security
  • in an area where keeping “backyard” animals was acceptable
  • offered enough nearby conveniences

Whether To Buy At All

Our needs may not be your needs and the best advice that I can give someone who’s thinking of retiring or otherwise relocating to the Philippines is to consider carefully whether their present and future needs require them to own real estate at all.

Renting offers mobility. If you don’t like your area after the lease or rental period is up, you can find somewhere else to live. Renting also offers a hedge against unstable relationships. Since your Filipino spouse will be the deeded owner of your lot, if your relationship fails, you won’t lose a large investment. Renting is also much cheaper, especially in the short-term.

Depending on where you want to live, there may be Western-style houses readily available for renting. If you’re more flexible, Filipino houses (which tend to be smaller, depending on the rental range) will almost surely be available. It’s also possible here to make improvements to a rental house that make it livable for you. Doing so will require permission from the owner so do nothing without their OK.

Another option is to buy a condominium unit. Foreign ownership of condo units is more flexible than land ownership here. I have no experience with condos here so, again, you’re best bet is to retain an attorney who knows the real estate business or consult with a reputable real estate firm.

What We Found

Here in the Philippines it’s almost always worthwhile to consult friends when you’re looking for something. Your spouse’s family, friends, former classmates, these are all people you should ask about property that might be for sale. In our case, one of my wife’s friends knew that the lot we ultimately purchased was for sale.

Doing our homework paid off in spades for us here in Davao. We now have a lot, a concrete fence and single-story 3-bedroom home on the edge of Davao where we have some established fruit trees, chickens, pigs and easy transportation. We have four neighbors nearby who have large lots of their own so we have our privacy. The security we wanted we were able to mostly achieve with building our fence/wall. Nearly all of our needs and wants were ticked off the list.

Establishing Lot Ownership

In the Philippines, ownership of land can be hard to determine. Deals are sometimes made outside of the system and paperwork, if it has even been filed, is frequently a mess. You should always retain an attorney to protect your interests when buying land.

Our lot has changed owners four times, counting us. The original owners divided the big parcel into smaller parcels and deeded them to family members. The person we purchased the lot from acquired it from one of those family members. Now, it’s ours.

We knew, going into this search for a lot, that title trails here in the Philippines were often murky. The friend who told us about our lot researched the title in the city records based on documents that the seller had. When we found that the title was clear, we hired an attorney knowledgeable in real estate (another friend of a friend) to help us through the process.

My wife was here in the Philippines at the time and I was in the U.S. After the paperwork panned out, I wired payment to the owner’s bank and the deal was done.

Building In The Philippines Final Thoughts

Whether you choose to rent, buy, or buy land and build, I hope you found some usable information in this post. Our situation isn’t everyone’s situation but hopefully there was a nugget or two for you to come away with.

If you have any thoughts that you’d like to share, please leave a comment below.

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