Boracay is one of the top islands in the Philippines. It is adorned with a long stretch of powdery white sand, crystal-clear waters, and mesmerizing sunsets that captivate the hearts of locals and tourists alike. Boracay offers many activities, including swimming, island-hopping, diving, snorkeling, parasailing, and kayaking. In this article, we will discuss buying property in Boracay.
Boracay property market
Boracay’s property market has flourished over the past decade, driven by its rising popularity among tourists and expats, leading to significant property value appreciation. Fueled by millions of annual visitors, the high demand for rental properties, hotels, and resorts has made hospitality investments exceptionally profitable. Improved infrastructure, such as the expanded Caticlan airport and upgraded roads, has further enhanced accessibility, reinforcing market growth when buying property in Boracay. Investors have diverse options, ranging from luxury beach properties for sale in Boracay to affordable condominiums.
The investment potential in Boracay’s real estate is strong, but understanding market dynamics and legal restrictions is crucial. Prime properties can generate substantial rental income, especially during peak seasons, and ongoing tourism growth and development projects promise future capital appreciation. Due to ownership restrictions, foreign investors should work with reputable agents and legal advisors when buying property in Boracay. Recent statistics highlight the market’s robustness, with property prices increasing by 5-7% annually over the past five years and occupancy rates for hotels and vacation rentals in prime locations exceeding 80% during peak seasons. Well-managed rental properties can yield 8-12% annual returns, illustrating the lucrative opportunities available in Boracay’s real estate market.
Can foreigners buy property in Boracay, the Philippines?
In the Philippines, regulations restrict foreign real estate ownership to protect the market for residents. Nevertheless, foreigners can still acquire property in Boracay through various methods. One common approach is leasehold, enabling foreigners to use and own land or buildings for a specified period, generally 25 years, with an option to renew for another 25 years. Another popular method is purchasing a condominium unit; under the Condominium Act, foreigners can fully own a unit if no more than 40% of the building’s units are foreign-owned.
Additionally, foreigners interested in freehold land or a house and lot for sale in Boracay can invest through a corporation. Domestic corporations can own land and buildings, which gives an excellent opportunity for investors looking to start a property rental business in Boracay.
Buying property in Boracay: 5-step guide for foreigners
Buying property in Boracay offers various opportunities for investment and personal use. The island’s popularity as a top tourist destination means owning real estate in Boracay, whether a beachfront villa, luxury condo, or commercial space, can be highly lucrative. Properties benefit from Boracay’s beaches and tourism industry. However, prospective buyers should know local regulations to preserve the island’s environment. Boracay provides various property investment options in a prime location with solid tourist appeal.
Navigating the property market as a foreigner can be both exciting and challenging. Below are the five steps of the buying process for foreigners in Boracay.
Step 1: Select a trusted real estate agent
While foreigners can purchase property in the Philippines, partnering with a local real estate agent can ease the process. A well-informed agent or a real estate company in Boracay can help you navigate the market and discover properties that meet your requirements. Their negotiation skills can be necessary during the purchasing phase.
Step 2: Browse properties on real estate listing websites
Alongside working with a real estate agent or a real estate company in Boracay, explore properties on reputable real estate listing websites like Own Property Abroad. These platforms present listings from individual property owners, agents, and developers, offering a broad view of available properties in Boracay. Upon finding a property of interest, you can directly contact the seller.
Step 3: Submit a letter of intent and make a deposit
Submit a letter of intent to indicate your interest in a specific property. This document generally includes the initial deposit, purchase price, payment terms, deposit amount, due diligence period, and the deadline for signing the sales agreement. The deposit secures the property, allowing you a set timeframe to perform due diligence.
Step 4: Conduct due diligence
This important step involves verifying the property’s legitimacy. Key steps include:
- Confirming the land title and ownership.
- Checking for existing liens or encumbrances.
- Reviewing zoning and land use restrictions.
- Conducting property inspections.
- Verifying the history of taxes and fees.
Step 5: Complete payment and sign the Deed of Absolute Sale (DoAS)
After satisfactorily completing due diligence, you can proceed to finalize the purchase. The Deed of Absolute Sale, a legally binding document signed in the presence of a public notary, formalizes the agreement between the buyer and seller. Ensure that all costs specified in the payment schedule are settled before signing.
How to find a property for sale in Boracay?
There are several ways to find property for sale in Boracay. Online resources offer numerous websites listing properties for sale in Boracay, allowing you to browse various options. Our listing platform also features many properties posted by individual owners, real estate agencies, and property developers in Boracay. You can contact these sellers if you are interested in any of the properties. Find a property in Boracay that catches your eye. It is highly recommended that you conduct due diligence when finding a house and lot for sale in Boracay. This can be done personally or with an external agent who can verify agreements, land titles, tax documents, and the location’s zoning.
Property prices in Boracay
Below is the table and the breakdown of property prices in Boracay.
| Type | Median price | Median price/m2 |
|---|---|---|
| Condo | ₱ 5.56 million ($99,286) | ₱ 100,487 ($1,794) |
| House | ₱ 6.17 million ($110,153) | ₱ 76,166 ($1,360) |
| Townhouse | ₱ 2.93 million ($52,269) | ₱ 66,655 ($1,190) |
| Land | ₱ 36.74 million ($655,775) | ₱ 22,888 ($409) |
Additional costs to consider
When buying property in Boracay, also consider these (potential) costs:
- Transfer tax: 0.5-0.75% of the property’s sale price.
- Title registration fee: About 0.25% of the total sale price.
- Documentary Stamp Tax: 1.5% of the property’s sale price.
- Real Property Tax: Not exceeding 1% of the property’s assessed value in the case of a province.
The best locations to buy property in Boracay
Boracay is renowned for its beaches and culture, making it a prime destination for property investment. Here are the five best places to buy property in Boracay:
- Aklan: Offers a strategic location with rural charm and easy access to Boracay, making it ideal for those who want a balance between tranquility and beach life.
- Caticlan: Home to Boracay’s primary airport, it provides easy access to the island and future infrastructure developments, making it a convenient investment spot.
- Malay: The heart of Boracay’s tourism hub offers a lively cultural experience and a range of property options, from beachfront condos to secluded villas.
- Yapak: It is perfect for those seeking a peaceful retreat with stunning beaches like Puka Shell Beach. It offers more space and privacy for luxurious homes and resorts.
- Manoc-Manoc: This community offers panoramic sea views and diverse investment opportunities, blending local island living with breathtaking natural beauty.
Starting property rentals in Boracay
Boracay offers excellent rental yields and impressive returns on investment (ROI), often exceeding 10%, due to the island’s growing popularity among vacationers. The demand for rental accommodations, such as hotels, resorts, and vacation homes, is strong, leading to high occupancy rates and significant rental income for investors. Purchasing commercial or residential property in Boracay is a wise financial decision because of the constant flow of tourists looking for housing.
Both Philippine and foreign nationals can start Boracay property rentals. Foreigners interested in a house for sale in Boracay must form a company in the Philippines to legally profit from their property leasing business. Trying to rent out property without creating a corporation, even if obtained under a leasehold arrangement, may result in legal issues.
Is it worth buying property in Boracay in 2024?
Starting a property rental business in Boracay is a promising venture, given the island’s status as a premier tourist destination. Boracay attracts many tourists year-round and is known internationally for its white sand beaches and marine life. The island’s upgraded facilities, like the Caticlan airport, have strengthened accessibility and raised visitor numbers. Property owners have a significant chance to earn notable returns due to the expanding demand for lodging, including long-term rentals for seniors and expats and short-term vacation rentals. Boracay’s investment appeal is further enhanced by the comparatively inexpensive cost of services and the friendly, hospitable Filipino culture.
Moreover, current development projects on the island are expected to strengthen and enhance its standing as a premier vacation and residential destination. The residential property in Boracay meets the rising demands for housing and the high expectations of wealthy travelers and investors. It is a great moment for investors to get into property rentals and take advantage of this growing industry. Boracay remains a popular destination, combining modern conveniences with a tropical paradise.
Expert assistance for buying property in Boracay
Buying property in Boracay, the Philippines, can be exciting but complex, especially for foreigners. Our experienced team is here to guide you through every step, from finding the perfect property to navigating legal requirements and completing the purchase. Whether you’re looking for a vacation home or an investment property, we provide personalized support tailored to your needs. You can also email us directly at [email protected] for more detailed inquiries and specialized assistance. Contact us today to ensure a smooth and successful property purchase in Boracay!
Frequently Asked Questions (FAQs)
What is the cost of living in Boracay?
The cost of living in Boracay is around ₱ 85,860 ($1,533) per month for foreigners.
Is it cheap to buy property in Boracay?
No, buying property in Boracay is generally expensive compared to other places in the Philippines, with condo prices averaging around ₱ 5.56 million ($99,286) and houses at ₱ 6.17 million ($110,153). The cost of townhouses is at ₱ 2.93 million ($52,269), and land for sale in Boracay is at ₱ 36.74 million ($655,775).
What property types are available to buy in Boracay?
The property types available to buy in Boracay include condos, houses, townhouses, and land.
What are the taxes associated with buying property in Boracay?
When buying property in Boracay, the associated taxes include transfer tax, Documentary Stamp Tax, registration fee, and Real Property Tax.
Which documents do foreigners need to buy real estate in Boracay?
Documents foreigners need to buy real estate in Boracay are identification documents, proof of funds, and possibly the establishment of a local corporation to comply with the 40% foreign ownership rule.
