How do you feel about condos in the Philippines?

[graham59]

3 hours ago, Shady said:

Nothing personal, but any foreigner who thinks they know the culture better than locals do

Did I say that ? 

Are you a local ?  

[Gandang Smile]

3 hours ago, hk blues said:

My sister-in-law lives in an Ayala unit here in Iloilo.  The public areas are OK, but rather underwhelming although they do have a very nice swimming pool.  The unit itself is fine, no significant problems albeit again a little underwhelming.  Compared to what I lived in in Hong Kong before, the finishes here are very average.  

That said, for $200K in Hong Kong you would not be able to buy anything at all, not even a tiny, tiny studio.  

As you probably know, Ayala has different brands, each coming with its own quality levels. Alveo is a mid-quality one, where you get a unit on the small side (studios less than 30 sqm), cheap door and window fixtures and outer walls too thin to even install split-type aircon units.

Back in 2015 I had a chance to buy Alveo instead of Aeon, the price per sqm was identical. Despite having been in the Philippines for just a few months, I knew that Ayala was the biggest name in the country. Yet, my estate broker managed to convince me that this project would be nothing short of revolutionary. At least on paper, the unit specs looked better than the Alveo across the road.

Fast-forward 6 (very) long years, the Aeon units do have better specs than the Alveos, at least on paper. Where the developer failed spectacularly is in delivering on the basic structural quality of the units. I am talking about concrete ceilings and walls that are "geometrically-challenged" as I called them. They told me the building had massive problems with some of the initial general contractors, who left in infamy and were even sued. Yet, by the time they left, damage was done.

Another "hurrah" to a staple of the Filipino mindset: clinch the deal, overpromise to get the highest possible payment, then deliver to the lowest possible quality you can get away with, short of being sued. In fact no, even if you get sued, the justice system here is so slow that you will have sent all your kids to study in the US with your (ill-gotten) proceeds!  

Edited May 24, 2021 by Gandang Smile

[Gandang Smile]

On 5/23/2021 at 5:40 PM, Freebie said:

Sorry to hear this, but its an oft repeated take that folks here didnt get what they paid for and feel they have no sense of redress.

I fortunately learnt long ago  to only buy from what could be considered good quality.

Mine is an Ayala Premier building which for Philippines is probably good standards... for HK where I lived in apartments for many years, it would probably be at best average quality, and for Singapore where I lived, would be considered poor quality. Would be average for Thailand and Shanghai  ie. Lots money spent on lobby and nothing spent on decor away from lobby.

Hope that things improve for you Mr Gandang but for sure the rental market isnt doing much at the moment, Manila wise.

 

Hi @Freebie

I am well aware that Ayala Premier is historically the only brand that is supposed to deliver an estate/living experience as close as possible to what you could find in the US, or the more developed Asian locales.

Unfortunately, as I have learned way after buying this (non-Ayala) Davao unit, Ayala puts a massive premium on their Premer properties. The only Ayala Premier project here in Davao is called Azuela Cove, a few low-density towers where 1BR units are a plush 110/20 sqm and all of them have a terrace facing the sea. Case on point, their sales launched at around P300/320K/sqm, basically more than double of what I paid for Aeon.

Yet, all the wealthy families in and around Davao flocked to snap up a unit. They knew Ayala Premier comes with some assurance of quality and didn't mind paying the premium.

My "savvy" estate investments have been in Manila, though. After months of looking and bargaining, we settled on a property that is in a business district (Ortigas), was very fairly priced, as the developer is not a well-known one, and all in all is good value for money. We never complained about our first unit, in fact we bought a second one after a few months, for investment.

Then pandemic struck and we lost the lucrative tenants (ADB foreign employees etc.), but that's another story...

I think it's indeed possible to find something of decent (= mediocre by international standards) quality that doesn't have to carry the Ayala label and its premium. It takes quite a lot of searching though. Back in 2015 I was in Davao, I probably had more cash than time (and wisdom!) to shop around 

  

[Gandang Smile]

On 5/23/2021 at 6:16 AM, Tommy T. said:

Sorry to hear of your hassles, Gandang. Your main comments relate exactly why we built our own home. Sure...it was a HUGE hassle. so many things the contractors either did not know how to do or just did poor quality work. Boots on the ground helped a lot to keep it from becoming a disaster. When we shopped condos and homes, the problems we saw were not indicative of quality construction - so many big cracks in walls, cheap and low quality fixtures... And, as I have mentioned before either here or in other threads, watching the construction - especially the masonry (hollow blocks and cement and "plaster") - can be downright scary...

At least we know what we have constructed and are pleased with the overall result...

Thanks for sharing your not-so-fine experience...

Thanks for the empathy, @Tommy T.

I have actually been suffering the "double whammy" of a building with plenty of prior construction issues, many of which will never be fixed because "damage was done", and the chronical lack of good labourers who 1) will do a decent work and 2) are not intent in overcharging knowing full well they will underdeliver "because Kano". 

 

[GeoffH]

We got bit by the condo "over promise and under deliver" problem as well.  We paid a substantial deposit and made ongoing payments towards a condo unit (in a tower which was mostly completed and the second of three in the development).  That was 2 years before we finally gave up and bought the house... the condo was finally delivered after we'd owned the house for over a year... just the condo mind you.  The higher floors (ours was near the middle) were still being finished, the pool, car parking and some of the recreation facilitie weren't finished either.

We ended up disposing of it at a loss (thankfully not to big of one)...  but once bitten twice shy, would never order off a plan again.

[Explorer]

Is a condo a good investment in the Philippines?

I think it is an excellent investment if you buy a condo or any other property to live in it, but if you buy a condo just to make money, I don’t think so.

Maybee for a filipino, who don’t have easy access to the financial markets, condo “investment” is a good deal.

But as a foreigner, why should I bother to “invest” in condos? I have my money in conservative index funds, ETFs, earning 10%-11% per year, zero cost to buy or sell with a click of a mouse, very low cost to maintain and my money is compounding year over year. I guess if you get the rare killer deal, too good to be true, so yes but other than that why bother to “invest” in condos in the PH as a foreigner?

Edited May 24, 2021 by Explorer

[RBM]

23 hours ago, OnMyWay said:

No matter where the house is, IMHO you need a caretaker of some sort.  Critters take over very fast here so you need someone to go inside every 2-4 weeks, check things and clean a bit.  Ideally.  If you have a garden, that requires upkeep too.

Having built a lovely home in a nice guarded sub division I would not of felt content staying away more than one night without a care taker. Not withstanding nite lights and such, always be a feeling of unease.

Another consideration about the title of this thread.

[RBM]

16 hours ago, hk blues said:

My sister-in-law lives in an Ayala unit here in Iloilo.  The public areas are OK, but rather underwhelming although they do have a very nice swimming pool.  The unit itself is fine, no significant problems albeit again a little underwhelming.  Compared to what I lived in in Hong Kong before, the finishes here are very average.  

That said, for $200K in Hong Kong you would not be able to buy anything at all, not even a tiny, tiny studio.  

Having stayed many times in same units I concur. Except though what they lack is a terrace. My partner just reminded me some over looking the lovely pool do have a terrace.....

After an exhausting day roaming around, eating drinking in beautiful up town Iloilo one needs to relax on a terrace with another beer. Pity as same units on upper level offer superb views through windows.

[Snowy79]

Taking a condo as a financial interest again depends on the location. 

My condo on Boracay would have recouped the investment after 5yrs but the good old 6 month rehabilitation closure hit then covid for one year bit more. By December it will have paid for itself though. 

The saving grace is a house on Boracay would have cost 5 plus times as much and as I'm living in it now I'm easily saving about 400k peso per year on an equivalent rental.

Throw in the condo prices are about 2m more than I paid for it with potential to shoot up in value post covid if the Governments plans to make Boracay a self governing area and more exclusive plays out. 

[Gandang Smile]

11 hours ago, GeoffH said:

We got bit by the condo "over promise and under deliver" problem as well.  We paid a substantial deposit and made ongoing payments towards a condo unit (in a tower which was mostly completed and the second of three in the development).  That was 2 years before we finally gave up and bought the house... the condo was finally delivered after we'd owned the house for over a year... just the condo mind you.  The higher floors (ours was near the middle) were still being finished, the pool, car parking and some of the recreation facilitie weren't finished either.

We ended up disposing of it at a loss (thankfully not to big of one)...  but once bitten twice shy, would never order off a plan again.

Hi @GeoffH,

Interesting, if sad, story. Is the condo complex you invested in located in CDO? So that would be 2 or 3 years delay, and just to get the basic residential unit. Looks like dressing up the specs and completion dates for a condo is a very common tactic to drive interest and sales.

I can see how Davao is plagued by lack of honest and skillful contractors and labourers. I can only imagine how much worse the situation might be in a smaller city, where cost of labour is lower and there is even less incentive for anyone to train and do a decent job.

After some initial reluctancy, due to having spent more than P2M just for improvements, appliances and furniture, and decoration, the idea is very solid in my mind to get rid of the unit as soon as I can find a willing buyer. Should be able to make at least a decent profit, albeit far lower than what I would have earned by simply investing the 200K in the stock mark or, heaven forbid, one or three of those cryptocurrencies.

Yet, the sour taste in my mouth will remain, to have received the ultimate confirmation that I simply can't, and won't, have anything to do with Davao anymore.