I recently got someone adding a post into my old blog which is something I don’t mind if the author had even taken the time out to introduce himself before trying to add a cut and paste to an article (spamming). Its also the fact these type of expats are the ones who exploit other expats by false information. The “Retire in Paradise” approach to life but normally at a cost. Inside the post reply came a few links back to the expats site and me being me took a bit of time out to look at it and compare notes from other expats with things that have happened in the past.

BUILD a House in the Philippines?
- Expect minimum $40,000 (not included lot) for only 100 sq mt living area
BUY an existing House & Lot?
- Expect minimum $50,000 for only 100 sq mt living area
RENT a House?
- Expect minimum $300 per month for only 100 sq mt living area
- $600 per month for a beautiful big house

First thing was the pricing (as shown above) build a house for a minimum of $40,000 ? only if you haven’t got a clue what your buying and trusting people like the advertiser. Buying property is relatively cheap here still purely because of the way LOCAL business development hasn’t expanded. i.e. no point having thousands of houses at $40,000 because the local market can’t support the demand most people haven’t got that budget. But someone browsing the net unaware is unlikely to know that right?

But an existing for $50,000 for 100 sq mt ? Well to be honest if your in a sub division in Cebu I would expect to pay around $20,000+ for 100 sq mt. But then again I wouldn’t spend $50,000 purely because it could take years to resell if we decided to move and also the fact its based on Sub-division prices which are simply false pricing because there is no real MARKET VALUE to compare prices. So why spend $50,000 best value for money is to look for a house via Filipinos and not making people aware you are buying. But no doubt our friend advertising these facts will be able to help via his realtor friend at a good premium right?

Rent $300 a month upwards? Well we have a small 1 bedroom house that costs us around $60 a month and I would say most expats are paying more but a lot of it is down to choice and security. I wouldn’t live in a condo or a sub-division but for $300 you can probably squeeze a 2 bed house with enough looking inside a sub or a 1 bed condo. The reason most people rent is not down to the house value but simply you can make more money with the money you would have to pay for the house in the first place unless you went for a mortgage.

So what would my advice be? If your buying be aware there are always hidden faults inside properties and also making sure the deeds match what the people have been paying in tax because often people build without permits which means there are back taxes as well as some hassles with officials although nothing major could cost you a few pesos to make everyone happy.

Going to construct. Will Irwan (the person who replied to the post which is the site I’m taking these pieces from) will tell you not to trust a local builder and to go with a reputable company as there is a 15 year defect liability by law in the Philippines. But what a lot of people don’t realise is that if you want a Western home it costs Western money its not that much cheaper! quality always costs more and I wouldn’t trust anyone with something I am not managing myself. There has been cases of concrete being cut from the mixes so people can make a bit extra on the side. There is a huge hotel outside SM that has stayed unfinished for years because of some of the defects and a problems with cost cutting (cost cutting for stuff the company had already paid for!) if the large companies are prepared to screw over big players what about the new expat on the block? Paperwork is simply that.. PAPERWORK you want a good builder they come with recommendations and previous jobs you can inspect. Balls to all the certificates and guarantees. Same in the UK how many Corgi Plumbers are cowboys? Infact a local borough council in the West Midlands carries the Corgi stickers on its vehicles yet it doesn’t have one Corgi registered plumber. The stickers are old. So who can you trust in the Philippines a lot of the time its down to you and Google.

The thing is to take your time every person I have met with an investment opportunity of a life time for example Will Irwin is also talking about his $30,000 investment returning $1,000 a month for investing in Nuts as a pretty much guaranteed thing because they are hurricane resistant etc. etc. but nobody mentioned drought which is one thing I have heard from a few expats who got involved with Mahogany they simply ran out of water and died losing the entire investment. Or David Whittle with his hard sell on the Legacy group very pushy to get people to invest as it was a “guaranteed” income of easy money and even if it went bad the money is covered by PDIC insurance right? Well if that was the case he and many others wouldn’t be struggling to get money back that they invested.

  Your probably thinking I’m a bit negative on this post and its more to do with a wake up call for people who are arriving. Don’t trust people around you! Because they invested in something doesn’t mean its going to work out as they could be blind to it as much as you are except you are buying into their trust. If your wanting to buy a house and want to pay extra go via a realtor but to be honest I would rather take the time out and spend a couple of months looking myself and getting something at the right price. Your time looking would probably pay you off financially because realtor = commission but remember the commission is based on SALE PRICE which is why you can often see people paying upto 3 times the real value of properties. We were at the doctors yesterday and the doctor had her long list of Vitamins she wants to sell us because they are “essential” but the essential has two different meanings. Essential to her making money off us to help pay for her next free cruise from the company she sells for. Essentially I see little value or use of vitamins unless there is a shortage within someone’s body of a specific type and even then there is the old fashioned way of eating healthy.

Building property I wouldn’t advise for anyone with no knowledge or patience. You need to take time to monitor the quality and also the methods being used. Often some things don’t make any sense and its partly these reasons I am looking to start our own construction company in the future. Not because I want to “get rich” off expats but we are building our own properties and it just makes sense for us to build properties for others along the way. Nothing wrong with Will Irwan making money with his company and I wish him all the best. But most of these old guys I have met offering advice to others are out to make money as its how they manage to retire in the Philippines in the first place. In the last 2 and a half years I have been in the Philippines I have learned I trust the foreigners less than I do Filipinos. There are good amongst both groups but the conversations I have had with other Expats recently out of frustration have all come back with the same response.

So if your coming here to retire etc. look after your money because if you don’t someone else will. If you want a genuine friend and advice I offer both as a friend I would tell you the Philippines offers a wonderful life if you embrace it and keep your head screwed on at the same time. As an advisor if you have enough money to retire just find some small investments in the Philippines you can do yourself or with someone you really can trust. But most importantly something that will not destabilise your pension and living ability. If you have large amounts of money (above P3m) I would simply find something outside the country to do with it that is secure we are in difficult financial times worldwide and markets change in an instant. If anything I would probably advise buying a home in the UK for example and renting it out. It gives stable income and somewhere to go back to if things don’t work out. If your coming without a stable pension or income I would simply say keep your job in your home country and visit first and get to understand the country. Making an income is possible but not easy. Getting to grip with how things work is time consuming but can be done. Cost cutting and setting goals would probably be your only real viable way of doing it for a big move. What ever you read above or in any articles just think about whatever it is your reading. If it seems too good to be true or complete bull your opinion is the most important. Its your life, your money, your retirement.

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