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Own property in The Philippines

Buying property in Cebu: A comprehensive guide

how to buy property in cebu

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Even though many think foreign property ownership isn’t possible, foreigners can buy property in Cebu, the Philippines. The Queen City of the South is one of the biggest cities in the Philippines, but it also shares its name with the province in which it is located and serves as the capital. Besides being one of the Philippines’ most essential and largest economic centers, the province attracts many foreign tourists, families, expats, and digital nomads. We’ll answer how to buy a house in Cebu and guide you through all the crucial steps and considerations during the process.

Cebu property market overview

The real estate market in Cebu has seen an increasing number of homebuyers and investors over the last few years, and it is expected to continue to grow in 2024 and the years after. Condominiums are a top choice, particularly in Cebu City, for both Philippine residents and foreigners, as they can own a unit when they meet specific requirements.

Rising interest rates, combined with the high inflation of 2023, have increased property prices in the province of Cebu, with the highest increase in Cebu City. However, the cost of buying a house or land in Cebu is still lower than in most parts of Metro Manila, making the province ideal for those looking for either a bustling city or a beachfront property in Cebu.

Once the pandemic was over, more and more foreign tourists visited the Philippines, with Cebu being one of the most popular destinations. The government expects the rise in tourist numbers to continue to grow, which makes Cebu the ideal location for real estate investment. Besides short-term rentals, Cebu is also attractive for long-term rentals, as many digital nomads, expats, and families choose Cebu as their (temporary) home.

Can foreigners buy property in Cebu?

The Philippines has restricted foreign ownership of real estate to protect its market for residents. However, foreigners can still buy property in Cebu through several different methods. Most foreigners opt for a leasehold, which allows them to own and use a piece of land or building for a certain period, mostly 25 years, with the possibility of renewing for another 25 years. Another popular option is buying a condominium unit. Under the Condominium Act, the Philippines allows foreigners to own a condominium unit fully as long as no more than 40% of the units in the building aren’t foreign-owned.

Foreigners who want freehold land or a house in Cebu can buy through a corporation. Domestic corporations, which can be fully or partially foreign-owned, are legal entities that can own land and buildings. This option is a perfect venue for foreigners who want to start a property rental business in Cebu.

Your guide to buying property in the Philippines

How to find property for sale in Cebu?

There are several ways to find a property in Cebu. Online, you’ll find many websites that offer property for sale in Cebu. These platforms provide the opportunity to search through many available properties. Our listing platform also lists many properties in Cebu, Philippines. These properties are listed by individual owners, real estate agencies, and property developers in Cebu, whom you can contact directly if you are interested in the property.

If you become interested in a property for sale in Cebu, you are highly advised to do due diligence. You can do this yourself or with an external agent who can check the documents, from agreements and land titles to tax documents and the location’s zoning.

Property prices in Cebu

Being both a large province and a cosmopolitan city, property prices in Cebu vary greatly depending on the area, city, or neighborhood. The average cost of condos in Cebu is ₱ 6.85 million ($123,252), while the average price of a house in Cebu is set at ₱ 12.01 million ($216,120). The table below shows a complete overview of the property prices in Cebu, including the annual growth and rental yield for each property type.

TypeMedian priceMedian price/m2Annual growthMedian rent priceRental yield
Condo₱ 6.85 million ($123,252)₱ 162,243 ($2,920)– 2.6%₱ 46,019 ($828)+8.1%
House₱ 12.01 million ($216,120)₱ 67,903 ($1,222)+ 0.7%₱ 88,102 ($1,586)+ 8.8%
Townhouse₱ 4.32 million ($77,780)₱ 56,897 ($1,024)+ 3.9%₱ 28,768 ($518)
Land₱ 7.66 million ($137,969)₱ 12,176 ($219)+ 11.8%₱ 220,656 ($3,972)
Commercial₱ 18.31 million ($329,618)₱ 124,537 ($2,242)+ 1.5₱ 161,166 ($2,901)
Apartment₱ 21.88 million ($393,810)₱ 61,822 ($1,113)+ 0.5%₱ 20,788 ($374)+ 1.1%
Source: Dotproperty

How to buy property in Cebu

Our step-by-step guide below explains how foreigners can buy property in Cebu, the Philippines.

Step 1: Choose a reliable real estate agent

Foreigners can buy property in the Philippines, but it’s better to work with a local real estate agent. With their knowledge of the market and extensive network, they will be able to find a house that meets your requirements more easily. Real estate agents are also skilled negotiators, which could benefit you.

Step 2: Find properties on real estate listing platforms

Besides using a real estate agent to find a property in Cebu, you can also use reliable real estate listing platforms such as Own Property Abroad. On our platform, individual property owners, real estate agents, and property developers in Cebu can list their real estate, making it the perfect place to shop for a house. Once you’ve found a property that interests you, you can directly contact the seller.

Step 3: Submit a Letter of Intent and pay the deposit

You express your interest in buying a particular property with a Letter of Intent. This document usually contains the initial deposit, price, mode of payment, deposit amount, period of due diligence, and deadline to sign the sales agreement. Once you’ve paid the deposit, you have reserved the property and can conduct due diligence for a limited period.

Step 4: Conduct due diligence

The fourth step of the buying process might be the most important one. Conducting due diligence lets you check if the property and documents are all in order. It’s essential to check the land title and ownership, look for existing liens or encumbrances, review zoning and land use restrictions, conduct due diligence property inspections, and verify the history of taxes and fees.

Step 5: Pay the costs and sign the Deed of Absolute Sale (DoAS)

Once the due diligence is over, you are ready to sign the Deed of Absolute Sale, a legal document signed by both parties at a public notary, proving that the buyer and seller have reached an agreement regarding the purchase of the property in Cebu. But before signing the sales agreement, you have to pay the property cost according to the payment schedule included in the contract. Besides the price of the house, there are several other costs and fees to consider when buying real estate in Cebu:

  • Transfer Tax: Buying a property in Cebu involves paying a Transfer Tax of 0.5-0.75% of the property’s sales price.
  • Title registration fee: The buyer must register the title at the Registry of Deeds, which costs around 0.25% of the total sales price (the exact cost depends on the property’s location).
  • Documentary Stamp Tax: All papers and documents necessary for transferring property ownership must be processed by paying a Documentary Stamp Tax, which is 1.5% of the property’s sales price.

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The best locations to buy property in Cebu

Being a large province, Cebu has something to offer everyone. There are several great areas, cities, and neighborhoods where foreigners can buy a home. Like Metro Manila, Metro Cebu has several cities combined into a metropolis.

When you are considering where to buy property in Cebu, you should take a look at the following places:

  1. Cebu City: As the region’s urban center, Cebu City offers a mix of high-rise condominiums and commercial properties. It is ideal for those who prefer a metropolitan lifestyle with easy access to malls, hospitals, schools, and business districts.
  2. Mactan Island: Known for its luxury resorts and proximity to Cebu International Airport, Mactan is famous for its residential and vacation properties. It’s perfect for buyers interested in beachfront living or having a vacation home that can also be rented out.
  3. Lapu-Lapu City: This city on Mactan Island is booming with developments thanks to its tourism and beach proximity. It’s a great area for investment properties or residential homes close to resorts and the ocean.
  4. Banilad (and Cebu IT Park): For those looking into luxury and high-end living, these areas in Cebu City are prime locations. They are well-developed, centrally located, and host to many expatriates and professionals.
  5. Talisay City: Located just south of Cebu City, Talisay offers more affordable residential options compared to the central city areas. It’s ideal for families looking for a suburban feel with close access to the urban amenities of Cebu City.

The table below gives an overview of the average condo, house, and land prices in Cebu’s best locations we’ve just discussed.

LocationMedian condo price/m2Median house price/m2Median land price/m2
Cebu City₱ 171,060 ($3,079)₱ 74,589 ($1,343)₱ 30,737 ($553)
Mactan Island₱ 177,302 ($3,191)₱ 83,355 ($1,500)₱ 19,812 ($357)
Lapu-Lapu City₱ 146,130 ($2,630)₱ 62,905 ($1,132)₱ 18,209 ($328)
Banilad₱ 128,877 ($2,320)₱ 114,677 ($2,064)₱ 54,768 ($986)
Talisay City₱ 117,341 ($2,112)₱ 62,198 ($1,120)₱ 17,834 ($321)

Starting property rentals in Cebu

Cebu can be the perfect location to invest in real estate, as the area has many local residents and attracts businesses, tourists, expats, and digital nomads. These all need accommodation during their stay in Cebu, which makes it lucrative to buy commercial or residential property in Cebu as an investment.

Anyone can start property rentals in Cebu, both Philippine nationals and foreigners. However, foreigners have to establish a company in the Philippines to generate revenue with their property rental business. Renting out property without a company, even if the property is bought under a leasehold agreement, could lead to legal issues.

Is it worth buying a property in Cebu in 2024?

Several factors suggest that buying a property in Cebu in 2024 could be beneficial. The region is experiencing economic growth, with real GDP growth indicating a recovery trajectory, although not at the rapid pace seen in 2022. This economic recovery is essential for Cebu’s real estate industry, as it usually leads to increased demand and opens up new investment opportunities.

The real estate market in Cebu is expanding, such as the development of one million square meters of new office space across strategic locations in Cebu City, including Cebu City Proper, IT Park, and Cebu Business Park.

A downward trend in inflation is expected to stabilize the economic climate, fostering a setting conducive to sustainable growth in real estate values. Moreover, the Philippine peso’s strong performance as one of the best-performing currencies in Southeast Asia makes it more appealing to invest in the Philippine real estate market, which benefits Cebu.

This robust economic backdrop, coupled with Cebu’s position as a hub for international business, particularly in the BPO sector, underscores the city’s global appeal and reliability as a real estate market. Thus, for those looking at 2024 and beyond, Cebu presents a promising opportunity for real estate investment, supported by strong economic fundamentals and a growing international presence.

Buy property in Cebu with Own Property Abroad

Do you want to buy property in Cebu? Own Property Abroad can assist you and ensure a seamless and hassle-free property journey. Thanks to our knowledge and experience in the local market, we can help with legal requirements, finding suitable properties, negotiating the best deals, and conducting due diligence.

For further information on how we can assist you, kindly drop your details below or email us at [email protected]. Let’s start working on your property success story today!

Talk with our real estate agent in Cebu

Leave your name and email below – Our real estate agent will reach out and assist you with buying a property in Cebu.

Frequently Asked Questions (FAQs)

How to find a reliable real estate company in Cebu?

It’s possible to find a reliable real estate company in Cebu by asking for recommendations in your network, searching on the internet, or visiting physical offices on the street. Always read reviews and testimonials to learn about other people’s experiences with the company, and make sure to check the background and history of a company and its founders before transferring any money.

What are the best Cebu City neighborhoods?

The best neighborhoods in Cebu City for both living and investment include Cebu IT Park and Cebu Business Park, Banilad and Lahug, and Capital Site and Camputhaw.

Is Cebu good for real estate investment?

Cebu is considered a good location for real estate investment because it’s the country’s economic center. It attracts an increasing number of Filipino nationals looking for work, as well as foreign tourists, expats, and digital nomads. Cebu has much to offer, from big cities to tranquil nature, making it a perfect place for everybody.

Is it smart to buy real estate in Cebu?

Buying real estate in Cebu is considered a smart investment due to the city’s growing economy, thriving tourism industry, and ongoing infrastructure developments. The real estate market in Cebu offers diverse options ranging from residential condos to commercial properties, catering to different budgets and preferences. The steady appreciation of property values and potential rental income make Cebu an attractive location for both local and foreign investors.

Where to pay Real Property Tax in Cebu City?

Real Property Tax (RPT) in Cebu City can be paid at the Cebu City Treasurer’s Office at City Hall. Additionally, for convenience, payments can be made at authorized collecting banks and through online banking services provided by some banks. Always check with the local city hall for the most updated list of payment options.

Your guide to buying property in the Philippines

Written by Matt Timmermans

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Your guide to buying property in the Philippines

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