23/10/2026
Under the Philippine Constitution, foreigners are generally restricted from directly owning private land.
However, there are 5 clear legal pathways that allow foreign citizens to own or control property in the Philippines:
1. The Condominium Act (RA 4726)
Foreigners can purchase and own individual condominium units in their own name.
• The Rule: Under Republic Act No. 4726, foreigners are permitted to buy units as long as the total foreign ownership of that specific condominium corporation does not exceed 40%.
• The remaining 60% of the building must be owned by Filipino citizens or Filipino-owned entities.
2. Long-Term Lease Agreement (RA 7652)
While you cannot buy the land outright, you can legally secure it for decades via a long-term contract.
• The Rule: Under the Investors' Lease Act, a foreign investor can enter a long-term lease for private land for an initial period of up to 25 years, which is renewable once for another 25 years (a total of 50 years).
• This leased land can be used for residential, commercial, industrial, or tourism development.
3. Purchasing Through a SEC-Registered Corporation
Foreigners can indirectly acquire and own land by establishing a domestic company registered with the Securities and Exchange Commission (SEC).
• The Rule: The corporation can buy and own land provided it complies with the 60:40 equity rule. Filipino citizens must own at least 60% of the company’s capital stock, meaning foreign investors can hold a maximum of 40% equity.
4. Marriage to a Filipino Citizen
Marrying a Filipino citizen opens a path to utilizing land, though the property's legal title has strict limitations.
• The Rule: If a foreigner is married to a Filipino citizen, the land can be purchased, but the Transfer Certificate of Title (TCT) must be registered under the Filipino spouse's name.
• The foreigner's name can be included in the deed of sale as a witness or marital partner, but they cannot hold sole ownership. If the Filipino spouse passes away or the marriage dissolves, the foreigner cannot inherit full ownership of the land but is given a reasonable time frame to sell the property to a qualified Filipino citizen and claim the proceeds.
5. Former Natural-Born Filipino Citizens (BP 185 / RA 9225)
Individuals who were born in the Philippines but later naturalized as citizens of another country retain specific land ownership privileges.
• Batas Pambansa Blg. 185: Allows former natural-born Filipinos to own up to 1,000 square meters of residential urban land or 1 hectare (10,000 square meters) of rural land.
• Dual Citizenship Law (RA 9225): If a former natural-born Filipino officially re-acquires their Philippine citizenship through dual citizenship, they regain full, unrestricted land ownership rights just like any other citizen living in the country.
When buying a property in the Philippines, a foreign buyer must prepare for closing costs totaling roughly 3% to 5% of the property's value. If purchasing a brand-new unit from a developer, an additional 12% Value-Added Tax (VAT) may apply.
The Bureau of Internal Revenue (BIR) calculates these percentages using the highest value among the actual Selling Price, the Zonal Value, and the Fair Market Value.
Mandatory Buyer-Side Taxes & Fees
These are the transactional costs customarily shouldered by the buyer to legally transfer the title or leasehold rights into their name:
• Documentary Stamp Tax (DST): 1.5% of the property value. This is a documentary tax paid to the BIR to validate the Deed of Absolute Sale.
• Local Transfer Tax: 0.5% to 0.75%. This is paid to the local City or Provincial Treasurer’s Office where the property is located. (Metro Manila typically charges 0.75%, while outside provinces charge 0.5%).
• Registration Fee: Roughly 0.25%. Paid to the Registry of Deeds to officially issue the new Condominium Certificate of Title (CCT) or Transfer Certificate of Title (TCT).
• Notarial Fee: 1% to 2%. Real estate documents must be notarized by a public notary to be legally binding, which usually costs a small percentage of the property value.
