Kingpin Posted October 21, 2023 Posted October 21, 2023 9 minutes ago, OnMyWay said: Those type of leases are different. What monthly fee do you mean? As far as I know, these SBMA residential leases are all cash up front when the lease is obtained from SBMA. Right, I meant that in contracts where the lessee buys or builds the house (leasehold agreement), the payment(s) to lease the land would be significantly less. For example this: 3 hours ago, OnMyWay said: The rich guy who bought mine is going to do major renovations And since he doesn't own the house, he likely needs to ask permission to renovate. But if you own the house (and foreigners can own this type of house) you could do anything up to and including complete demolition. Link to comment Share on other sites More sharing options...
Popular Post Snowy79 Posted October 21, 2023 Popular Post Posted October 21, 2023 I spent a few years doing research both inside and outside of the Philippines before buying a condo. It's one of the best decisions I've made to-date but you must do your homework and also know what you can live with and live without. My research showed me that the majority of condos in cities are expensive, hard to sell and have various build quality issues and certainly only buy off plan if it's one of the major players in the Philippines, DCMI, Ayala, Megaworld etc. I narrowed mine down to Boracay, the reasons being first of all I got a bargain as the previous owner was returning to the UK and just wanted shot of it, hunt down these type of properties as you can offer way below the asking price. I calculated rent on Boracay was about 25k peso to be on one of the World's top holiday destinations with access to every type of restaurant, Western style delis, medical centres, immigration office, sea port, airport, live music, stunning beaches etc. I looked at the advice or renting but figured it's dead money, a great idea if you are in a city or subdivision that turns out to be a nightmare as you can just up sticks at the end of your term and go elsewhere but if you've bought you are left with a hard to sell property which if lucky you can only rent out for a max of 25k per month unless you've bought a mansion. On Boracay I calculated I could do short term, daily rentals at up to 4.5k per day if I tired of the place, plus it's way easier to sell as there's a limit to titled land on Boracay. The island was closed down for about 8 months then covid struck but as I was living in it I calculated I'd saved easily 3/4m on dead rent. Another added bonus which is overlooked is it has allowed me to find a hard working and honest partner that isn't with me just because I fund her lifestyle whilst she became a lady that lunches like quite a few of the expat partners here. As sure as eggs are eggs if you move here you will have females after you and not all have good intentions, many have been talked into buying land and building a home for their partner, you as a foreigner can not own the land so you are at the mercy of your partner, you have only one retirement fund remember. In such a case renting until you see the real person is certainly a bonus. Being Scottish and almost as tight as a Yorkshire man I don't believe in paying my partner to live with me but I give her free rent and food. I found an identical condo inside the same resort for long term rent at 30k per month and agreed with my partner if she was to set a business up she could manage my condo and I'll have zero to do with it, any profit is her wage but she will clean it, meet the guests and do all the chores plus pay my rent. She turns over at times 100k plus gross per month and after taxes, expenses and my rent is left with a very tidy sum. She has proven to be a diamond, respects hard work and has gained pride in being a wage earner off her own back. My condo in the mean time has doubled in value judging by the selling prices here now and if my realtionship goes South she has no claims on my condo. We aren't married but if I do marry her it isn't matrimonial property. 4 1 2 Link to comment Share on other sites More sharing options...
OnMyWay Posted October 21, 2023 Posted October 21, 2023 (edited) 1 hour ago, Kingpin said: Right, I meant that in contracts where the lessee buys or builds the house (leasehold agreement), the payment(s) to lease the land would be significantly less. Yes, but of course it should be based on the value of the land, so a hectare in BGC will be a huge value, whereas a hectare in the province will be a fraction of that. There are 67,000 + hectares in the old Navy base. A lot is still jungle. Some of it is dedicated to Aeta indians. The rest is commercial and residential leased out. They recently reevaluated the housing leasing scheme for the purpose of renewals, I think they now value it at 10,000 per square meter. 1 hour ago, Kingpin said: And since he doesn't own the house, he likely needs to ask permission to renovate. But if you own the house (and foreigners can own this type of house) you could do anything up to and including complete demolition. It is basically the same here in SBFZ. There is a building permit department and you apply for the work you want to do. The Navy houses are built well, so it is not often you see a complete demo. That is complicated by the fact that most "houses" are duplexes in my area, and some areas are 4 plexes. Our new "house" is an 4 BR end unit on a 4 plex. Some of those Navy guys had big families! The architect who is doing the work for my buyer is doing another duplex reno around the corner that my friends used to rent. It was the first complete demo near me. These Navy duplexes have a thick concrete wall between the units. So after they demo'd the right side, the other left house is still there with the thick wall standing. Usually when a complete demo is done, they rebuild with steel beam construction. Sometimes someone buys a duplex and converts into a single unit. My Korean neighbor (now departed to Vancouver) bought the house across the street that was already a very nice duplex to single conversion. He added on with steel beam construction and it is huge now. He had to create a big doorway in the Navy concrete in the back wall, and he told me they went through several jack hammers! He was trying to sell for 35 mil but no takers so he rented it. He was asking 200k a month but finally rented it for 120k, according to the chismis. Here is the biggest, most expensive house for sale. Owned by National Book Store owners. A 4 plex converted to one. Lowered from 85 to 80! 10 BR. Overpriced. Only 22 years left on the lease. https://www.facebook.com/photo/?fbid=802325928360191&set=pcb.802327441693373 Edited October 21, 2023 by OnMyWay 1 Link to comment Share on other sites More sharing options...
Kingpin Posted October 21, 2023 Posted October 21, 2023 46 minutes ago, OnMyWay said: Here is the biggest, most expensive house for sale. Owned by National Book Store owners. A 4 plex converted to one. Lowered from 85 to 80! 10 BR. Overpriced. Only 22 years left on the lease. https://www.facebook.com/photo/?fbid=802325928360191&set=pcb.802327441693373 Love it. So basically, 300k a month fixed for 22 years. It's a really interesting dynamic because you're overpaying compared to every other option, but you're getting what no other option in the country offers. Link to comment Share on other sites More sharing options...
OnMyWay Posted October 21, 2023 Posted October 21, 2023 4 minutes ago, Kingpin said: Love it. So basically, 300k a month fixed for 22 years. It's a really interesting dynamic because you're overpaying compared to every other option, but you're getting what no other option in the country offers. That one is an extreme example and they will never get that price, especially with only 22 years left.. If you looked at a normal 4 separate units that is in very good condition, you might value it at 10 mil per unit, 40 mil. That 80 mil price is ridiculous. There are some beautiful duplex "spider" houses that are converted to one one unit that sell for about that much, 20 mil. Like this one. I think this was asking 24, lowered to 20. https://www.facebook.com/photo/?fbid=802356135023837&set=pcb.802357908356993 There are a few factors that go into your actual final cost per month. My current leased house that I just sold increased in value and I made a profit on the sale, so my per month over the 8 years is a profit, not a cost. Even after counting in the improvements and maintenance I spent, I lived here for free + a profit. Link to comment Share on other sites More sharing options...
Kingpin Posted October 21, 2023 Posted October 21, 2023 1 minute ago, OnMyWay said: There are a few factors that go into your actual final cost per month. My current leased house that I just sold increased in value and I made a profit on the sale, so my per month over the 8 years is a profit, not a cost. Even after counting in the improvements and maintenance I spent, I lived here for free + a profit. I was just thinking about that, so if you paid 20m for 20 years, after 10 years the minimum value should be 10m, and then on top of that you add any property value increase. But that increase only happens if you sell the lease, not if it expires... Link to comment Share on other sites More sharing options...
OnMyWay Posted October 21, 2023 Posted October 21, 2023 1 hour ago, Kingpin said: I was just thinking about that, so if you paid 20m for 20 years, after 10 years the minimum value should be 10m, and then on top of that you add any property value increase. But that increase only happens if you sell the lease, not if it expires... No, remember, they are basically bought and sold at market value, which is whatever someone will pay. I got "lucky" the first time, "buy low, sell high". It could be the opposite next time if market prices are declining. The real estate bubble is bursting in the U.S. and other countries. If there is a global recession, I suspect PH real estate prices will fall too. Link to comment Share on other sites More sharing options...
Lee Posted October 21, 2023 Posted October 21, 2023 7 hours ago, OnMyWay said: Lowered from 85 to 80! 10 BR. Overpriced. Only 22 years left on the lease. What a house---wow. So let me understand this lease thingy clearly. If someone bought this house for 85M Php it would give them possession of the house for the next 22 years. After the lease expires then to stay in the house you would need to purchase another lease for whatever the market suggests the house is now worth. Is this correct? Please advise. 1 Link to comment Share on other sites More sharing options...
OnMyWay Posted October 22, 2023 Posted October 22, 2023 4 hours ago, Lee said: After the lease expires then to stay in the house you would need to purchase another lease for whatever the market suggests the house is now worth. Is this correct? Please advise. Close. SBMA has a formula for determining the value when "renewing" the lease. The renewal is for 25 years. However, SBMA has been very vague about the terms of the renewals and when they can be done. They recently announced something new that was also not clear. The community has been complaining about this. Link to comment Share on other sites More sharing options...
OnMyWay Posted October 22, 2023 Posted October 22, 2023 4 hours ago, Lee said: After the lease expires To add, you would never let the lease expire or you would lose it. I think the renewal would be done 1-2 years before expiration. I think what the residents want is to be able to add years at any time during the last 25 years. E.g., you get down to 15 and add 25 for a total of 40. The more years you have in the lease, the higher the market value. 1 Link to comment Share on other sites More sharing options...
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