“Most who make the journey to the 7,000-odd islands that comprise the Philippines are pleasantly surprised by their beauty and by the friendliness of the people. On top of this, transport is cheap, the food is good, accommodation is plentiful and (for the mono linguistic) English is widely spoken.”
-The Lonely Planet- http://www.lonelyplanet.com |
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Robust tourism
The number of tourists visiting the Philippines breached the three-million mark in 2007, with spending by foreign tourists reaching almost P5 billion for various services and products. Tourist expenditures reached $4.885 billion in 2007, surpassing the $3.782-billion target. Increased consumer spending power The country’s outsourcing boom is providing its workforce with more disposable income that are actively spent on retail goods Friendly people Filipinos are widely famous for its “bayanihan” or spirit of camaraderie. This communal trait holds them together in good times and bad, and they extend it to visitors as well. Filipinos are also known as friendly, festive people who smile readily, adore music and love to welcome visitors with their famous brand of hospitality. Ideal climate for Live, Work and Play The Philippines is a rich tropical archipelago that offers a mix of the old and new, and a wealth of artistic and cultural heritage. It is blessed with abundant natural and historic wonders—majestic waterfalls, beautiful beaches, ancient rice terraces, reefs teeming with diverse aquatic life and many other landmark structures. Its capital city and principal port is Manila—a modern metropolis that has its own share of new and historic attractions to suit every interest. |
Why the Philippines?
The Philippines: One of Goldman Sachs’ N11 countries The global investment banking and securities firm Goldman Sachs has named the Philippines as part of the N11—the Next 11 countries with the highest economic potential in the world. Forming part of the N11 are Bangladesh, Egypt, Indonesia, Iran, South Korea, Mexico, Nigeria, Pakistan, the Philippines, Turkey and Vietnam. All 11 countries demonstrate population growth rates above those of Western developed economies, indicating greater consumer market potential over the medium term. Large populations represent a wide potential pool of consumers for businesses to target; while high growth rates mean that this market will expand rapidly, providing proportionally more potential customers. The Philippine economy is poised for its STRONGEST RECOVERY in 20 years.
The Philippine economy grew 7.3% in 2007, the fastest in 31 years. The Philippine currency has reached an 8-year high in 2007 and continues to be strong and resilient in 2008, fortified by the economic management of the current administration. The government spent P62.22 billion in 2007 for infrastructure projects including transportation development, flood control and the decongestion of Metro Manila. Among these major projects are the P992-million Marikina Bridge and access road, the P1.7-billion MacArthur Highway from Meycauayan to Tarlac City, the P180-million 1-Sales Interchange of NAIA expressway and the P598-million Ramps 2 and 3 of Skyway. Five more major projects are set to be completed by 2010. Bold fiscal reforms have led the government to record a balanced budget two years ahead of schedule. The country’s credit rating has been upgraded from negative to stable, and its budget deficit which stood at $3.74 billion in 2004, is expected to be eliminated completely by 2008. The Philippine Stock Exchange, the main barometer of local stock price movements, jumped 21.4 percent to 3,621.6 points at the end of 2007 from 2,982.54 in 2006 to record the index highest year-end closing level. The overall business climate is upbeat and industry leaders and CEOs are of the perception that 2008 will be even better. The Philippine economic resurgence We are on the verge of the biggest real estate boom in history, set to totally eclipse the 1997 Asian crisis, and fueled by money from Filipinos working abroad, foreign investment and a strong and bullish economy. The real estate boom will encompass a wide range of developments – from residential houses to condo units, to office towers, leisure facilities, hotels, warehouses and factories. A surging demand for real estate is expected to sustain a continued surging growth of the real estate industry. The Philippines has emerged a strong second to India in the global outsourcing market. In 2006, it recorded $3.6 billion in earnings, a 50% jump from 2005. By 2010 it is expected to earn as much as $12.2 billion. Big outsourcing players in the U.S. such as Sykes Enterprises Inc., Convergys, People Support Inc., Accenture and eTelecare Global Solutions have already set up headquarters in the Philippines. Dell Inc. recently opened a contact center and is on schedule to open a second one. The Philippines is becoming a much preferred option as it has stronger cultural ties to the United States than India and it is expected to catch up and even overtake India as a market leader. Remittances from Filipino expatriates has grown to over $1.5- billion dollars a month or P759.3 billion in 2007. The current economic managers of the country have remained steadfast in pursuing a blueprint for an economically prosperous future. Why Invest in Philippine Real Estate?
“The Philippines stands out as an improving nation. The Administration’s economic blueprint is commendable and is expected to bring renewed heights of confidence and growth.” New Millennium Investments Why Invest in Philippine Real Estate “We are bullish in the prospects for the Philippine residential real estate sector. It is poised to bounce back in a very big way.” CNN International Housing is always a rewarding investment as it gives one a sense of pride and ownership. After a 7-year downturn, the Asian market that includes the Philippines is expected to recover and outperform other markets.Consumer incomes are rising, unemployment is falling and interest rates are down. Prices in Metro Manila are inexpensive compared to other major cities around the world. Property is a good hedge against inflation. Rental income from property is a stable source of income, and while it may fluctuate, is highly unlikely to vanish altogether, unlike stocks. Real estate is always a hedge. Although prices can certainly fall as well as rise, property values will never fall to zero unlike shares or hedge funds. Property is a kind of hybrid asset with the capital appreciation of a stock but the income producing capacity of a bond. With a more robust economy, prices are very affordable and the payment options and/or financing terms are more flexible. Philippine property appreciates at an average of 10% per year, which is higher than 3 to 6% US properties get. This translates to a higher ROI. The slump in real estate in the last 7 years has resulted to a dramatic reduction in the supply of new real estate projects. The demand for housing of all types is now more than ever greater than supply. The backlog for housing is about 4 million units. Units that are being pre-sold generally appreciate in value by 10 - 30% by the time the project is finished. |
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Foreign Nationals Protect Your Investment Assets in the Philippines
Currently foreign nationals are not allowed the specific right to hold Philippine land in their individual name. They are however allowed full and complete ownership in their individual name of a Philippine condominium. The easiest and securest way for a foreigner to hold title of Philippine land, is to create a Philippine corporation to hold title. Either a stock or LLC type corporation. LLC is the simplest form to create, and just as secure as a stock corporation. Many foreign individuals and companies form an LLC type of Philippine corporation. Incorporating allows the foreign national through their Philippine corporation the best way to own Philippine land with the lowest risk and the most control over of their Philippine investment assets. Along with a Power of Attorney, and Declaration of Trust agreements, from the Filipino co-incorporator, foreign nationals are now assured that their Philippine investment assets are secure, and under their control. The best and easiest form of Philippine corporation for a foreign national to form is a Limited Liability company. A limited liability company ("LLC") is a legal form of business company that is an amalgam between a partnership and a corporation. The members have the same tax benefits as a partnership (unless the members of the LLC elect to be taxed as a corporation) at the same time being able to take advantage of the limited liability for the actions, obligations and debts characteristics of a corporation Advantages of an LLC Limited Liability. Like the shareholders of a corporation, the owners (called 'members') of an LLC have limited liability for business debts. Pass-Through Taxation. An LLC with multiple owners will, by default, be taxed as a partnership. Owners report their share of the profits and losses of the LLC on their personal tax returns, and no separate tax is assessed on the company itself. Management Flexibility. LLCs have much more management flexibility than corporations. An LLC may be managed either directly by its owners or by a manager who may be one of the members or may be hired to run the business. An LLC may have an unlimited number of owners. Simple Record Keeping. Unlike corporations, LLCs are not required to hold an annual meeting and draft meeting minutes. Deductible Expenses. Similar to a corporation, normal business expenses like an owner's salary may be deducted from the profits of an LLC before the LLC's income is allocated to its owners for tax purposes. Flexible Profit & Loss Allocations. Unlike a corporation, an LLC is not required to allocate profits and losses in proportion to ownership interest ("member interest'). This means that the owners of an LLC can agree to allocate the company's profits and losses among themselves however they see fit and not necessarily based on the percentage of the company each owner controls. Disadvantages of Limited Liability Company Limited Life: Corporations can live forever, whereas a LLC is dissolved when a member dies or undergoes bankruptcy. Initial Public Offering: Business owners with plans to sell shares of their company to the public, or issuing employee shares in the future, may be best served by choosing a corporate business structure. Added Complexity: Running a sole-proprietorship or partnership will have less paperwork and complexity. As a foreign national, your LLC will have no choice but to be classified as a corporation for tax purposes. Good day, and good Cebu real estate investing! |