Investing in overseas real estate has become an increasingly popular option for investors looking to diversify their portfolios and potentially earn higher returns. For foreign investors like the Japanese, the Philippines is an attractive real estate investment location given its robust economy, continuously growing population, and favorable business climate. This offers a high potential for capital appreciation and rental income — making it an attractive investment opportunity for any Japanese investor.
PHILIPPINES AS AN ATTRACTIVE INVESTMENT LOCATION
Compared to other Southeast Asian countries, the Philippine real estate market offers relatively low property prices, making it a favorable option for Japanese property buyers. Furthermore, the lower cost of living makes it an attractive destination for Japanese retirees seeking a second home in a neighboring country. In the case of ProperAccess Japan, most of its property buyers, accounting for 90%, purchase real estate as an investment, while the remaining 10% acquire properties for personal use.
Generally, Japanese investors tend to focus on properties in major urban areas like Manila and Cebu which offer great potential for capital gains. Manila in particular is an attractive city for foreign investors because of its ongoing infrastructure projects such as the subway system which are expected to drive up real estate prices.
COMMON DIFFICULTIES IN OVERSEAS INVESTMENT
Investing in Philippine real estate also comes with risks and challenges — the language barrier being a significant obstacle for non-native property buyers. PropertyAccess Japan’s Senior Asset Manager Naoyuki Takeda states, “In general, it’s not easy for the Japanese to purchase and own properties overseas, including the Philippines, because there are language barriers between countries. Most Japanese are not fluent in English.”
As a result, Japanese investors actively search for domestic real estate firms that provide opportunities for overseas investments, which are not widely available within the country. PropertyAccess K.K (Japan) is one of the few real estate companies that have supporting offices all over Asia including Singapore, the Philippines, Thailand, Vietnam, and South Korea. This allows them to provide professional support and guidance to Japanese investors to ensure a smooth purchasing process overseas and overcome other hurdles such as navigating through legal and regulatory frameworks.
PropertyAccess also provides a wide array of services for both property seekers and property developers such as property sales, transaction support, KPO, real estate conferences and events, property portals, and cross-border marketing.
CURRENT STATE OF THE PHILIPPINE REAL ESTATE MARKET 2023
By all indications, the second half of 2022 proved to be a busy time for the real estate market in the Philippines. this trend continued into 2023 as the country fully opened its economy to foreign investors. The surge in occupancy rate of office spaces due to demand from traditional companies had a positive impact on the residential market as professionals return to on-site work arrangements.
This presented an opportunity for foreign home buyers to acquire multiple residential properties in the Philippines, with many opting to use PropertyAccess for their consultations, purchasing decisions, and transactions, especially in Japan.