Can Germans Buy Property in the Philippines?

Does being German change the answer? No.

This is the first thing to get straight, because most of the internet gets it backwards. The Philippines law does not sort foreign buyers by nationality for this asset. A German buyer, a British buyer and a Singaporean buyer face the identical rule. Your passport is not the variable. What varies is the route your money takes to get there and what your own tax system does about it afterwards, and that is what the rest of this page is about.

What you can own, and what you cannot

You can own a condominium unit: the unit outright on a Condominium Certificate of Title, held in perpetuity. You cannot own land, which the 1987 Constitution reserves to Filipino citizens. That line is not negotiable and no structure sold to you as a way around it is safe. Read the full ownership rules before you form a view on any particular building.

The money leg, from Germany

The unit is owned outright and in perpetuity, which is stronger than most of the region. The constraint is the building: foreign ownership across the whole project cannot exceed 40%, and that has to be checked before an offer, not after. How the transfer works is worth reading before you commit to a price, because the wire is the part that decides whether the exit works.

The German-specific constraint. German residents are taxed on worldwide income, and Germany has a double-taxation treaty with each of these markets that decides which country taxes the rent and how relief is given at home. Which article applies depends on the property and the income, so it is a question for an adviser rather than a rule of thumb.

What your own tax system does about it

Tax is paid where the property is, and then again considered where you live. German residents are taxed on worldwide income, and Germany has a double-taxation treaty with each of these markets that decides which country taxes the rent and how relief is given at home. Which article applies depends on the property and the income, so it is a question for an adviser rather than a rule of thumb. Confirm which treaty article covers rental income from that specific country, and whether relief comes as exemption or credit with an adviser who handles both sides — not with a sales agent, and not with this page. What the local side costs is set out in the the Philippines tax guide.

Does buying get you a visa? No.

Buying property in the Philippines does not grant residency, a long-stay visa, or a right to work. Anyone telling you otherwise is selling something. Visas and property are separate systems and should be planned separately.

What German buyers get wrong

The same three things, in the same order. They treat the brochure yield as the real one and never subtract the running costs. They plan the purchase and not the exit, so the first time anyone thinks about getting the money back out is when they want to sell. And they let the money leg be arranged by whoever is selling them the property, which is the one part of this that should never be outsourced to the counterparty.

Frequently asked questions