In recent years, the Philippines has made its mark as one of the hottest property markets in Asia. Economic growth remains strong, property prices are rising and interest from overseas investors is increasing. At the same time the real estate market is maturing as buyers become more aware of quality, brand reputation and investment returns.
As a result, we are seeing more foreign entrepreneurs moving to the country to take advantage of this market growth. I should know — I was one of them. I arrived in the Philippines in 2013 to launch the local branch of global property portal Lamudi. I was immediately struck by the incredible warmth of the people of this amazing country. I believe Filipinos are the happiest and friendliest people on the planet. The people working in my team are entrepreneurial, proactive, super hard-working and a lot of fun. It is a joy to work here.
Although the real estate profession is dominated by locals, foreign professionals are able to work in the country, provided there is a reciprocal arrangement with their home country — that is, that Filipino nationals are allowed to work as real estate brokers in their country of origin. For example, American real estate agents can get a license here because Filipinos can practice in the U.S.
At present, most foreigners are employed by big brokerages such as Colliers, JLL and Cushman & Wakefield. However, increasingly you see some foreign entrepreneurs setting up professional real estate brokerages in the Philippines. A good example is KMC MAG Group, where the two co-founders, Greg Kittelson and Amanda Carpo, are American and Filipino respectively.
So for real estate professionals who are dreaming of a sea change, the Philippines should be at the top of their list. Here are my top tips for those looking to do business in the country’s vibrant property market:
1. Exercise patience.
Above all else, you need patience and perseverance. When Lamudi first arrived in the Philippines, it was difficult to secure sales because we were a completely new brand in the market. It takes a lot of time to build trust, especially with big clients such as developers and banks. Now after only one year, with repeated follow-up and strong brand visibility in the market, many deals are finally succeeding and developers are starting to come to us rather than the other way around.
2. Look to the Internet.
The world of online property search in the Philippines offers a wealth of opportunities. Internet penetration has grown 531 percent over the past five years — to reach 39 percent at present. This is expected to cross the 50 percent mark this year. Because of this rapid growth, those working in property now realize they need to be online. Consumers are now searching for property online. Brokers and developers all are aware of the need to market their properties online. That makes for a perfect opportunity for brokers, agents and developers.
3. Be aware of cultural differences.
A major advantage of working in the Philippines is that nearly everyone is fluent in English. As a result, you experience much fewer cultural problems than you normally would because you speak the same language. Filipinos in many ways are culturally closer to the U.S. than to other Asian countries.
Generally, they are entrepreneurial, proactive and outspoken. However, on the opposite side of the coin, they can also be nonconfrontational. They find it very difficult to relay a negative message and will rather avoid you in every possible way than tell you the hard truth. So you can have a great business meeting one day, and the next day the same client will not answer your calls.
4. Know the market and your customers.
If you are looking into starting a rental business, you will need to know your customers thoroughly. Do research so that you go in knowing what properties they want and what amenities they are looking for.
You will then be fully prepared to match their needs. For those looking into cashing in on capital appreciation, choose your developer and location wisely. For example, the mid-end condo market in metro Manila is slowing due to oversupply, but the capital’s high-end and luxury segments are still experiencing healthy sales takeup due to strong leasing market and capital appreciation. Market research is key on both sides.
I hope these tips are encouraging to you, and I hope you might consider the Philippines. I love it here, and I have found success here by implementing these strategies.
Jacqueline van den Ende founded De Kleine Consultant, the first nonprofit, student-run strategy consultancy with 130 consultants and nine offices across the Netherlands, U.K. and Sweden. After three years as a private equity investor at HAL Investments, she relocated to the Philippines in November 2013 to set up Lamudi.com.ph, the local branch of international real estate portal Lamudi.
Editor’s note: An original version of this story incorrectly stated the nationality of a director of the KMC MAG group. This version has been updated to correct the error.