One of the major concerns an expat has when considering retiring to the Philippines is the housing question! This was a concern 28 years ago in the Philippines and it remains a frequently asked question in 2014. Most expats are not interested in living in a native nipa or bamboo house but believe it or not, some expats embrace that adventure! I know a couple of Americans who are proud of their native houses because it has the real Philippines look & feel to it and they spent up to $20,000 USD for it to be quality built, including air conditioning.
Building Or Buying A Handyman Special
My advice is to build your own house unless you can do the renovations on an older house yourself or you are at least are very knowledgeable about it. The cost of quality building material is on the rise, however, the cost of labor remains constant and affordable for many expats. I don’t know anywhere else in the world where you can build a quality home for under $40,000 USD, with $30,000-$35,000 USD average for a 2 BR house for a family of 3.
The other major problem in the Philippines is buying a 2nd hand house that actually has a clean title with it! Many foreigners have been burnt badly by buying property that has a *hidden* mortgage loan against it. Once you buy the property, you inherit the mortgage loan. If there are any unpaid property taxes, you also inherit them as well.
Countryside Construction
It is much easier to build your home in the province, outside an actual city. The building permits are easily and quickly acquired and the fee is much lower in the countryside.
We built a house in the province in 2009, about 40 km south of Bacolod. We hired a young gun architect, who has very unique designs and he had the experience with personal contacts to get things accomplished in a timely manner. Since he is a nephew, his fee was only 5% of the total cost of the house. My wife already owned the land, so we did not have to buy another lot. The Philippine Constitution does not allow foreigners to legally own or control land in the Philippines, so the land must be in a Philippine citizen’s name.
The architect secured all the permits needed for our home construction in 2009. He personally went with us to AM Building Supply in Bacolod for us to choose 100% of the building materials. Since he has been involved in the construction of other houses, he was granted a very generous discount for purchasing the materials at AM and by paying cash. We received 100% of the discounts and kickbacks were not involved! It was our cash buying the materials.
The architect supervised our own hand picked construction crew of skilled craftsmen and we worked out P10,000-P12,000 per square meter to build our house, which included material and labor. The architect supervised everyday during the construction of the foundation, which was built on volcanic rock formations, the walls and the roof. He supervised the remainder of the construction 2-3 days per week but never the same days of the week. The construction began in January, 2009, and our home was move-in ready the end of June, 2009. All the receipts and materials matched 100% and none of the material walked away! We actually had a surplus of material, which we used for other building projects. We were very pleased with the quality and the price of our new home in the Philippines! Five years later, we are still proud of our home in the province.
The Best of Both Worlds
In 2011, we were informed of a super deal in a new subdivision in Bacolod City! An Overseas Filipino Worker had purchased a lot and started construction on his new house. However, he lost his job and could not complete the deal. This property was heavily discounted for an on spot cash deal and it was a deal we certainly could not refuse. The location was exactly where we had planned for building our city home, so everything fell perfectly into place for us. The house was about 85% constructed, so we had hands on with the final 15% or so of the remaining construction. We added much better material and added our own design to the finishing touches.
Our house in Bacolod City is located in a rural area of the city. We have the best of both worlds! The comfort of countryside living with all the modern city conveniences only 10-15 minutes drive in our family vehicle.
If you are married to a Philippine citizen, who can own the land or lot, it is really better to build your own house. It is also a very sound investment as opposed to throwing money away on renting instead of buying. It is not my money but I know some expats who spend P250,000 per year on renting a house in the city! In Bacolod City, you can buy or build a very nice brand new house, including the lot, for P1.3 million- P2 million, depending on the location in the city. Five years of renting some houses can outright pay for a new house and lot, which can be actually owned.
Happy Building!
What is your advice to an expat who wants to build a house and who is not married to a Philippine citizen? Are there any legal loopholes that may allow this to happen? Or am I stuck with renting?! Thank you.
Ocean Hill,
There are not any loopholes in the Philippines law that allows a foreign to buy land. Starting a dummy corporation to circumvent the law is a major crime here. A foreigner can own a condo but not the land, as long as 60% of the unit owners are Philippine citizens.
A foreigner can own a building or a house but not the land. It is perfectly legal to have an attorney formulate a long term lease with a Filipino land owner and build on it. You cannot be evicted without the land owner compensating you for the cost of the mortar and bricks, which would be stipulated in the long term lease agreement. However, most foreigners do not like the idea of building a house on land that will never be their own or at least on land not owned by their wife or partner.
Regards,
~ Gary ~
Very useful your information ! I have in mind to retire at the Philippines: I´m married to a lady from Mindanao and she has land there near the road. So my idea is to build a small but beautiful house to relax after a so hard life i´m having. We think we can do it with 2 million and reading your comments i am quiet sure i can do it. By the way i like the zone you´re living, i will be at the south Bansalan del Sur, quiet far but also very nice! Maybe one day who knows we have a drink and a nice chat ! Thank you for your post.
My experience in buying real estate is a little bit different if you cannot buy under your name, I will find a land with a house own by a Filipina citizen and acquire the land by installment with the option the sell the house after a certain years. The the profit on rhe sales, I will paid the balance of the house and the left over, I will find a better location to built again using the same system. This time, I recovered of what I pay to the house. The title is always with the owner of the land. What do you think my fellow expatriate? Thanks Ed
I love the idea of finding a plot of land in a rural area, buying it in my wife’s name (yes, I am married to a filipina) and then hiring an architect and construction workers to build a house. However, the state of Internet infrastructure in the Philippines is pretty pathetic, based on two recent stays there in 2013. Is there land available for a reasonable price (say less than 1M PHP per acre) in a well-developed area that would have decent Internet access available? Rural sounds lovely. But if no high-speed Internet is available, I can’t build there…
Hi David,
I can’t tell you for sure about other areas than the Western Visayas but you can buy a decent size lot in Bacolod City and Iloilo City for less than P1 million to build a house. I am not sure exactly the high speed you need but I don’t have any problem with my current internet service here in Bacolod, which is Globe and it is unlimited for P999 per month.. At our farm house, about 40 km south of Bacolod, I have to sit on the patio to get a fast connection, as it is almost useless inside our home! I have also seen a neighbor climb a coconut tree to get a cell phone connection. No such problems at our home in Bacolod City.
I had Sun Wireless Broadband Internet for 3 years and it was only P799 per month but PLDT bought them out and ever since, the connection was very poor, so I switched to Globe and it is great.
Regards,
~ Gary ~
Hello sir Gary..
May i ask what are the requirements or permits needed to build a 1 level house in bacolod? Currently, do you know how much is the estimated cost per sqm to build a house in bacolod? Thanks
Hi, in rural small town with 1% crime a year, the cost per acre range from 700 to 800 which is below 1 million. My brother and me own 6 acre land and I am planning to built a one million house in one acre using stucco, bricks and central blocks combination. I will hire an architect to design this house. This house is worth approximately $ 700,000 in Colorado. I will talk to some architect who already built the house on nearby town if this is possible. I will supervise the purchase of materials and the construction, Bye all my expatriates who cannot buy under their name. I hope this will answer your concern.
Ed
I don’t know anywhere else in the world where you can build a quality home for under $40,000 USD, with $30,000-$35,000 USD average for a 2 BR house for a family of 3.
Gary,
I’ve lived in the Philippines for quite some time and I’m finding it impossible to agree that a quality house can be built for the amount you cite. In my experience, those numbers apply to tract houses with 80 SM of floor space on a 100 SM lot. They lack adequate insulation; exterior and interior door jambs, windows sills, straight walls and level floors, and a built to last roof. None I’ve seen at the prices you mention have wiring harnesses, grounded electrical circuits, or sequential water cut-off fixtures. To me, those things only touch the outer boundaries of quality construction. Costs climb exponentially unless the buyer is satisfied with plywood doors, wrought iron window frames and casings and single pane clear glass windows and the cheapest possible plumbing fixtures.
Advise please. How does one go about building a quality house for the amount you cite?
Gordon
Hello Gordon,
Where do you live in the Philippines? The cost of living and the cost of housing is dependent upon the location. I live in the Western Visayas. Your comment on my article is more suitable for the Retiring to the Philippines forum. We can continue this discussion on the forum. It is only one click away! I look forward to your response.
Regards.
~ Gary ~ .
I don’t know anywhere else in the world where you can build a quality home for under $40,000 USD, with $30,000-$35,000 USD average for a 2 BR house for a family of 3.
Answer Gordon’s question….
Are we talking quality here or just “it’ll do” standards …
Quality housing. That is a conundrum here in the Philippines. There are various degrees of quality that when compared to a typical American home simply do not match up. When looking to purchase in the U.S., they (the builder) provides you a list of specifications of what exact materials are used; what special element of construction is applied; what is included in the purchase of the home, including all exact materials and quality of those materials so you can make an apple to apple comparison; what is also included in terms of appliances, etc.,: what kind of warranties are included and how dependable those warranties are. Also, since the Philippines is always being struck by different catastrophic events such as earthquakes, typhoons, floods, etc., you need to purchase Home Owner’s Insurance. What kind of actual guarantee do you have that the insurance companies will fix your damaged home in a very timely manner? Since I have lived in the Philippines, I still have not met one builder who could give me the name of one insurance company that will really protect you in the event of disaster. In the U.S., if your home is hit by a hurricane/typhoon, the insurance company will IMMEDIATELY, come to you and supply you with enough cash to find a hotel, rent a car, buy food and protect you until they either fix your home totally or give you full cash replacement value which usually takes about ten days. How can anyone buy a home worth 5 million php and then get stuck when a disaster takes place?
Excellent question. Any recommended companies, by expats who have made claims, out there? I don’t know of any, but haven’t actually lived there for any great length of time….or built a house there (although strongly considering it now). Car insurance is disappointing enough….wonder how house insurance actually plays out when it comes to claims – if at all. Would love to hear about good house insurance companies, and car insurance as well!
We used to have car ins but canned it last year. The problem is the time it takes to process a claim added to the fact that if you are a foreigner, you are in deep doo do! A friend was rear ended by a Filipino driver. The police officer placed the blame on the friend! When asked why the copper replied, “well sir, if you were not living in our country, you would not be in this position!”
My advice is to take out what we Aussies call third party ins. That way you will be covered if you collide with a vehicle or pedestrian.
Your concerns are valid. Have you had any satisfactory responses?
Gary
My wife is a filipina citizen. She has dual citizenship. U.S. And P.I. We have a hector of land in Bicol. We want to build a house on it. We are moving there next year May 2015. The issue I am having is finding someone who has integrity and honesty to build our home. I have been in and out of the P.I. since 70’s. I was station in Subic bay has a Marine from 87-89. I know the country and the people quite well. I am aware of all the corruption. I refuse to work with anyone I cannot trust!! Do you have any contacts of someone who meets these qualification and is close to the bicol region. Or who would come there and build the house. Please let me know. Thanks!
Hi Morris,
I do not know any architects or developers in the Bicol Region. However, I suggest posting on the Retiring to the Philippines forums, as one of the regular posters may be able to recommend someone.
Gary
Can you let me know what you have found out since? I am also planning on moving to Bicol region. My wife owns property there and we plan on building a small home. I too will not trust just any contractor” my wife has told me stories about what can happen if you are complacent.
I have retired and am here in Philippines. Been here a year and half. Had a bahay kubo ( local modern home) pending building the main house.
You have to come here for yourself . And weed thru a bunch of contractors to find the best one for you. A lot of them think because you are a foreigner you are rich. And will take you to cleaners if you let them. Not all. They can be cunning. I have the info on the guy that’s building our home. I use him to build the road to our house and things on bahay kubo. I will be using him to build our home.
hi mr gary..i live in eastern side of visayas and for 2 months my husband and me are planning to build a house 80 sq meter in biliran province..bonggalow with 2 bedrooms and 1 bathroom is 600k will be enough?thanks inadvance..
Hi Miss Marianne,
P10,000-P12,000 per sqm is usually the rule of thumb for building a quality house in the Eastern and Western Visayas. However, you can still build a house of 80 sqm for P600,000 by taking some shortcuts and cutting out some extras.
If you consult an architect, he can help you about cost cutting on the material and you can still have a nice bungalow.
Gary
Rick,
Come on now. What about all the people in New Orleans when Katrina hit? Some are still waiting for money years later!
When you say the Philippines is always being struck by different catastrophic events, you are painting the entire country with a very wide brush. We don’t normally have earthquakes,typhoons and floods in the Bacolod Area that bring massive destruction like seen in Luzon and in the Eastern Visayas.
Yes, there is Homeowners Insurance available that pays up in the Philippines.
Tornadoes are not common in our area of the Philippines but one hit in 2012 in our Barangay. Within the week, the Municipality handed out money to those who had their homes destroyed or severally damaged in Negros Occidental.
~ Gary ~
What many foreigners (particularly Americans) forget is that the Philippines is a tropical country. That means two storey homes will be hotter ( hot air will rise) to the upper floor. The roof should be a light colour to reflect the sun. Try not to have a peaked roof design as that will add to you cost. Better to have a just enough slope for runoff. Go for a solar hot water tank. They are a huge cost saver (connect to a gas water heater for rainy season with a booster switch. Have a verandah surrounding the house for shade.
Agree, but the problem with heat, are the lack of insulation of the ground too..
Yes the ground floor in our house is surrounded by a wide veranda which is covered in vines. The walls are insulated with thick foam insulation which has been covered by marine plywood.
Gary, you seemed very satisfied with the work quality and process your architect gave you, but is he available for any other jobs?
Sidney,
Our architect is now working abroad as an architect, so he is no longer available in the Philippines.
~ Gary ~
Gary and others,
I will be marrying my Filipina fiancée soon and am looking at land and the prospect of building our own house on it in Northwest Mindanao within the next five years. Having investigated the prices and costs that Gary is talking about, I find him to be quite accurate when compared to the construction cost index forecast by the government of the Philippines. P11k-12k for 2016 is forecast to rise steadily to about P13-14k/sq.m over the next 5 years to 2020. These figures are for the “average cost of construction”. The construction Codes and Standards in a place where seismic loads (the basic effect of earthquakes) and increasing wind loads (cyclones) need to be taken seriously by those contemplating settling in this lovely place. Take advice from this Engineer and spend money on some place where the risks are lowest among the islands if you want to settle here. look at the flood risk and seismic risk maps with and Architect/Engineer. It will be worth every minute you have to pay for. There are increasing numbers of land hustlers who don’t understand or even know or care about the risks….but they need to be considered.
Great advice, Dave.
The west coast of Bacolod is rarely seriously affected by typhoons and this is why a number of foreigners like this area. Bacolod City has good drainage, which helps during the rainy season.
~ Gary ~
This is great info. Did you wire your house for 110 or 220? Is it difficult to retrofit an older house with 110 or is it mainly a case of upgrading the main electrical panel?
Sorry if I’m asking a stupid question but why would you get your home wired for 110? Surely Americans don’t bring all their appliances with them! What happens when the appliances wear out? We brought a few Aussie appliances with us but it’s 240 and works fine here. I did realise that we were coming to live in a foreign country not bringing Australia with us.
Speaking of bringing Australia with you Jules LOL….Did you spring for a whirly-bird or two on the roof to clear out the hot air? Just wondering how well it works there. Works fine for me here in WA. I have a large lot in Talisay, just to the north of Bacolod, we’re finally considering building on. Seems like a practical idea to me as I know people in tropical Qld who use them to cool the place down at night….
Also, how is the solar industry doing there, and the new batteries for night-time power…..I would gladly spring for a 10Kw solar system, and the biggest battery (likely Samsung) I could get – to never ever need power from a Philippine company. I have heard horror stories of days, weeks, and after a really bad typhoon -a couple months – without electricity. Anyone doing the solar panel/battery yet? Moving on, how about Solar Hot Water Systems….remember a company selling a major Australian brand on Cebu a few years ago….Anyone using such a system – and liking it? Just curious about how much technology is moving there – particularly with the money saving involved….
Us aussies know how to build to this climate. I have a whirly bird on the roof. It works well! Just make sure they install it properly! You dont want the roof to leak. Try to build on one level as 2 storey is unsuitable in this climate. Yes we are installing solar panels as soon as we can. You can get them from manila and other areas. Just look online. Not cheap at around 350000 for a large home but worth the cost. Another way of saving money is to use a gas hot water system as well as a gas stove.
Hi Jules. I’m moving to Cebu soon. Please excuse my ignorance. Did you say build on one level because hot air rises so the second level gets too hot? Thanks.
The major problem with two storey homes in the tropics is that hot air rises into the upstairs rooms. Americans are used to two storey homes as their climates tend to be less severe. However, if the second storey is properly insulated and ventilated so the hot air can escape. Why would you want stairs to climb if you are older anyway?
Personally, I prefer a single storey home with wide porches around the whole building. We have enclosed porches which we use most of the year. We have also planted lots of shade trees. Last year we put in a plunge infinity pool. Instead of expensive plumbing, we have two huge water features that filter the water. The water spills over the side and is pumped through the water features back into the pool.
Look at some of the Balinese houses and you will find some excellent ideas there.
Great ideas… thanks for sharing your insight! I’m trying to get my wife to buy into a single story set off the ground on stilts, solar power, recovery system for water to an infinity pool in western Leyte. I’m not clear on “Balinese houses”, but I’ll research that later. Thanks again!
I am working in Q8, I plan to build as soon as I retire in a few months. I have been in & out of the Philippines since 1982. Not all home builders will try to rip you off. But who really knows which will or will not ? There is a system in the Philippines set up to check on your home builder, almost like the Better Business Bureau.
in the states. As for me, I am going to wait so I can have a sit down with my builder because it will be my retirement home. I want it my way at my cost.
My wife and I would like to buy a 1,000 square meters ++ land lot somewhere in the greater Bacolod region. Living outside The Philippines, we are finding it challenging to locate properties For Sale at reasonable prices through online sources — it seems that most land lots or houses listed online are targeting foreigners with deep pockets. We bought land in The Philippines in 2008 for a very fair and reasonable price through my wife’s family member, Admittedly, the price we paid was below market value and we certainly do not expect to be so fortunate buy in the greater Bacolod region. We would, however, like to find a knowledgeable local real estate agent who can assist us. Does anybody have any leads as to who we should contact for assistance?
Hi Gary……You have been a stellar advocate for Negros and full respect….Look…I am an American living in Australia with a Filipina wife of almost 40 years – so we didn’t fall out of the banana crop…No we have been back and forth forever. We do have a very large lot in a premier Talisay subdivision….and after many years have reached retirement age and looking to move to our new home. What just peaked my interest was a random web search and the sight of the lovely 2-story wood house above……Suits me and my wife….Is that a house built in Bacolod area….and if so any idea what it costs….The land is ours…The building is debatable…..We have had some attractive chatter from wealthy relatives….but I like to move under our own speed and go for what suits us….Cheers….and Semper Fi…..Yes, I am one…..
Hi Charles…. I fell in love with the same house. Let me know if you find anything out. would love to build in the Philippines as well.
I am hoping to move near San Francisco, Mindanao. I am a builder by trade but am having a fit trying to locate where to buy, material supplies, cost, etc., etc. The Net will not show what I need to know! I need to view in-depth material list, available lumber, lengths, steel beams, roofing metals…EVERYTHING and it seems to be the best kept internet secret.
HELP!
Hello,
My mother is a Filipino citizen with a house and lot in the Philippines. Her two children are American citizens. She’d like to pass the property down to us, is that possible? And if not, what would happen?
Thanks,
Fran
How much is the estimated cost to build a house 3 bdrm and 2 bedrm in Virac-Valencia Cauntduanes Philippines 1800 sq ft Already have lot.