Buying land

[robert k]

I think you would fall afoul of the anti-dummy law with your corporation set up. It smells from the start. You are going to wind up paying everyone through the nose. Why not just rent/lease? Your corporate scheme adds complexity but not more security.

If they cancel a paid in advance lease through a court action they are supposed to refund the unpaid portion and pay you for improvements you will be denied the use of? How would the corporation improve on this? I think you would be in a worse position with the corporation because it stinks from the start whereas the lease is maximum legal.

There is something to the old saying that it's hard to cheat an honest man. I've been offered some really good deals in my life which I have turned down and others have accepted to their great loss. It becomes much easier to chop a mans head off if you can entice him to stick his neck out. If you deal with crooks, you become a crook and they can easily justify taking you to the cleaners, if they needed any justification, they are crooks after all? If you complain in court you face the unclean hands doctrine.

I can understand that owning property in your homeland is an asset, but it isn't necessarily an asset in the Philippines. For one thing, when you die what happens to the 60% Filipino owners? Are you willing their portion of the corporation to them or is the loan going to become due? If you will it to them you are worth more dead than alive? Over the years they will eventually think of things, every time they need money? 

Just my point of view, a paid in advance lease would be a better option. Less moving parts, less people with a stake in bringing you down, if it comes to that.

[Snowy79]

The investment act is a Government act that allows for the leasing of land. There are three classes of investment some of which allow 100% foreign ownership. A standard corporation and leasing the land is 100% trying to circumvent the anti dummy laws and as such you could lose everything.

The investment act pretty much ensures you register the corporation via PEZA (Philippine Economic Zone Authority) who have the ultimate say in how and what the corporation does. You have to supply a business plan and report via them.

I'm early days into reading up on it but from a brief discussion with a lawyer it's the only legal way as ultimately PEZA have been authorized by the Government to encourage foreign investment yet retain control. The basics being if you set up a company and through dodgy means lease the land to yourself you are depriving a Philippine national of it's use. If you do it via PEZA they look at the land, business etc and decide if it's needed by a Philippine national or will benefit the Philippines. They look at competition and local businesses in the area. If there's no conflict they will register the corporation and allow it to operate.

In my case a home with separate rental accommodation employing a local in an area where there are few paying jobs. As long as I do my annual returns via PEZA I'm legal for 50yrs. Of course if things change within those 50yrs PEZA cancel my registration and the company folds but is entitled to compensation. As I say it is early days but what has been said about setting up a corporation and trying to have share holders sign away their rights is correct. You will fall foul of Anti Dummy Laws. http://www.peza.gov.ph/index.php/about-peza/implementing-rules-and-regulations

[mogo51]

19 hours ago, Reboot said:

I guess the idea is to not risk more than you can afford to lose when it comes to property in the Ph.

Just assume you are going to set the cash on fire...and have backup plans back home.

From what I understand, you can build a pretty decent house in the provinces for about $50k, so it's not necessarily a whole lot of money to risk.

 

Well that would be very different from member to member, for me $50k would be way more than I would want to lose, so I will only rent.

[Dave Hounddriver]

7 hours ago, robert k said:

If they cancel a paid in advance lease

Sounds like you are remembering all the problems with the businesses in south Dumaguete and the filipina owners cancelling leases and releasing to someone who offered more money. (Black Pearl restobar etc). But many foreigners have to learn all that the hard way.  Its just how life is here. Most people who have been burned just stop talking about it as there is fresh meat coming every day to get their fingers burned in the same fire and all the talking about it ain't gonna prevent it.

 

But there are lucky ones, and maybe the OP is one of those.

[Snowy79]

I think the moral of the story is we are in a Foreign country that doesn't play by the usual rules. They are slowly catching up to the way modern countries do things and as such getting better at catching out those bypassing the system but they are also making allowances as long as the proper processes are followed. I'm learning more every day and as soon as I find a way I'm researching and finding problems. There's no silver bullet.

You get married and put your trust in your wife it has it's problems. You buy a condo it has it's problems, some times more than being married. You open a corporation it goes against Anti Dummy Laws (big problems) or you go down the Foreign Investment route which has registration and reporting issues but is legal.

For me I've found a stunning lot in the right price bracket with a clean title that has been fully checked. DENR visits carried out etc. Spoke to the local Barangay and adjoining lots are all under the ownership of rich foreigners with Filipino spouses. I'm looking to build a house and rental business for those liking luxury but peace employing a couple of locals and have been assured the paying jobs are much sought after as the location is a good 45 mins from the nearest civilised town. It's in a bay and surrounded by rice fields separated by a ridge that runs behind the lot. We've met a few locals and got inside information on the area. The Barangay chiefs are well respected and control the area with firm but fair rules. The whole area looks very clean, no drinking on the beach or loud music for the locals unlike some of the beach lots I looked at. I get the feeling the rich lot owners assist the Barangay with a nice Church, Basketball court etc.

The seller is a well known German businessman. Triple checked by some friends in the area and he came back highly respected. He even highlighted issues to look out for again all of which came back exactly as he had highlighted. The whole area employs caretakers as most properties lay vacant as they're just holiday homes for the rich.

That said I'm still doing my due diligence. If I get burnt it won't be through not doing as much homework as I can. I've been married once and already lost enough to lose again

[robert k]

1 hour ago, Dave Hounddriver said:

Sounds like you are remembering all the problems with the businesses in south Dumaguete and the filipina owners cancelling leases and releasing to someone who offered more money. (Black Pearl restobar etc). But many foreigners have to learn all that the hard way.  Its just how life is here. Most people who have been burned just stop talking about it as there is fresh meat coming every day to get their fingers burned in the same fire and all the talking about it ain't gonna prevent it.

 

But there are lucky ones, and maybe the OP is one of those.

I think it's easier to cancel a month to month lease than one paid in advance

[Dave Hounddriver]

17 minutes ago, robert k said:

I think it's easier to cancel a month to month lease than one paid in advance

You would be surprised :-) but again

1 hour ago, Dave Hounddriver said:

Most people who have been burned just stop talking about it

 

[Reboot]

1 hour ago, Snowy79 said:

I'm learning more every day and as soon as I find a way I'm researching and finding problems. There's no silver bullet.

You get married and put your trust in your wife it has it's problems. You buy a condo it has it's problems, some times more than being married. You open a corporation it goes against Anti Dummy Laws (big problems) or you go down the Foreign Investment route which has registration and reporting issues but is legal.had highlighted. The whole area employs caretakers as most properties lay vacant as they're just holiday homes for the rich.

But there's a solution....if you just stay home and never do anything with interesting your life.....NO PROBLEMS! 

[Jack Peterson]

9 minutes ago, Reboot said:

you go down the Foreign Investment route which has registration and reporting issues but is legal.

 Life is a gamble, one we take every day we wake up, Waking up is a good way to start the day But we could go around in circles and end up exactly where we Started. One thing for Sure, whilst many of us are happy here most of us have been here long enough to know The Philippines is never ever going to be the "Land of milk and Honey" that many thought it could be. It's cheap, it's warm, in the main it is Welcoming (To those that want to embrace it) No one (as a foreigner) who is a normal run of the Mill Guy is going to make a fortune,

 For me, I came, We were married, I like it I stayed. TRUST is a word needed here & used sparingly in cases [there are hiccups of course]

But depending why anyone needs land (that's their business) Going the Route I went has paid off, I only had to trust one person and she has been my back bone for years. OH! I had chances to buy into things some that involved land others just cash But Nah! Too many pitfalls.

 If anyone can Remember "Thomas' he would have had us screaming on this one (The Topic)

 The one thing that I think most of us will agree one that there is a awful lot of Gobbledy gook witten on Websites that don't actually tell you what happens if it goes wrong, It can and does sometimes go wrong and when the tape is played back there is usually some skulduggery somewhere. For me, better to trust a wife you should know, than a bunch of Strangers you don't. 9/10 times they are there for themselves and not you.

[Reboot]

I like how you roll Jack.