How to Analyze International Deals

Question

Hey all!

My partner and I have been offered a privately owned cash flowing opportunity in the Philippines which is right on the ocean in a very popular location, and at what seems to be a very good price.  I am ready to begin analyzing this deal but honestly, where do you begin with an international deal?  Who do you trust to give you quality information?  I can say, on something like this, being new to the international realm, I will be looking strictly at the numbers and approaching everything cautiously.  But certainly don't want to let something which may in fact be a good deal slip away.

With that said, does anyone here have any experience buying international properties, especially in the Philippines (or have connections with someone who does) and what steps do you typically  take to ensure your analysis is thorough?  Who do you need to contact?

Thanks!!

Justin Kane · Answer

sounds like you have a "business trip" lined up.. need a partner? ive always wanted to go to the Philippines :)

Darlene Dato-on · Answer

I am a Realtor in Las Vegas, NV and own properties in the Philippines ( acquired before moving to the US). What kind of investment are you looking at?

As you may have known, only Filipino citizens can own land in the Philippines. As a foreign national, you can only purchase condos and townhouses there but not own a piece of land. Even a foreign national in the Philippines who was married to a Filipino citizen won't inherit the land when the spouse passes. The land should be in the citizen's last will and testament naming the foreign national as beneficiary. The foreign national will be given a certain period to dispose the property and collect the proceeds.

As someone born and raised there and practicing real estate and investing here, I say you have to go there and see for yourself. The real estate process is so different from here. The numbers you are working on will mostly be changed when you are there. Cebu, Palawan, Batangas have the more popular ocean views suitable for international investment.

Suggest you find a CPA here, a lawyer and a CPA there who can guide you through the tax laws and investment process. You might end up paying taxes in 2 countries most likely. I can recommend a lawyer and CPA there for you, if that will help.

Long story short : Go see for yourself and meet the CPA/lawyer in the Philippines and re-do your numbers. Good luck!

Tchaka Owen · Answer

@Chris Ball - it is very possible that the deal is real. I had a chat with a businessman who spends time there and he could buy a 2br condo by the beach, with amenities, etc. for ridiculously cheap. It is also possible that the person you're communicating with is sitting behind a screen in Romania and is trying to separate you from your wallet.

If the deal looks THAT good, it's easy.....arrange to see it (and any other similar deals) and fly out. The trip would be a write-off too. Good luck!

Dan V. · Answer

@Chris Ball I was from the Philippines. I have a condo there listed in Airbnb and it's doing great even if it's not at the center of the prime location, so it's not a bad idea to invest there. The challenge though is validating that the deal is legit and finding a reliable team to manage the property. Most of the service providers there can be found in Facebook (easier for them to setup than an actual website), just use extreme caution though. Do you mind sharing in PM where exactly in the Philippines the property is located?

Mike Lambert · Answer

@Chris Ball  Yes the numbers have to work but that’s only a small part of the analysis. I’ve been investing internationally for a while now and it’s totally different than investing in North America.

You need to go there, study the market, understand the macroeconomics of the place, the local laws, have a team on the ground. Bring sight unseen overseas is very dangerous in my opinion, especially if it’s your first international purchase.

If you don’t think you have what it takes, you can partner with experienced international investors who do. Investors invest internationally with me because they make more money and take less risks than if they were investing alone. They don’t need the huge time required to acquired the knowledge and expertise required and, most importantly, they have peace of mind. You’d have to find somebody else like me since I don’t invest in the Philippines.

I select the market where I invest based on a friend’s research who has been traveling the world to identify the best markets with the best opportunities. He has never mentioned the Philippines as being one of those markets so personally I’d stay away.

How to Analyze International Deals

Most Popular Reply