Buying and owning property in Panay Island as a foreigner

Authored by the expert who managed and guided the team behind the Philippines Property Pack

Everything you need to know before buying real estate is included in our The Philippines Property Pack

Who is the author of this content?

BAMBOOROUTES

A team specialized in real estate investing in APAC countries (Japan, Thailand, Indonesia, Australia, etc.).

We are a team of financial experts, legal professionals, developers, and local real estate specialists dedicated to helping people like you avoid mistakes when investing in real estate in a foreign place, particularly in Panay Island. If you'd like to learn more about us, you can check our presentation page.

How this content was created 🔎📝

At BambooRoutes, we explore the Philippine real estate market every day. Our team doesn't just analyze data from a distance—we're actively engaging with local realtors, investors, and property managers in cities like Iloilo, Kalibo, and Roxas. This hands-on approach allows us to gain a deep understanding of the market from the inside out.

These observations are originally based on what we've learned through these conversations and our observations. But it was not enough. To back them up, we also needed to rely on trusted resources

We prioritize accuracy and authority. Trends lacking solid data or expert validation were excluded.

Trustworthness is central to our work. Every source and citation is clearly listed, ensuring transparency. A writing AI-powered tool was used solely to refine readability and engagement.

To make the information accessible, our team designed custom infographics that clarify key points. We hope you will like them! All illustrations and media were created in-house and added manually.

What can foreigners legally buy in Panay compared to locals, and what restrictions apply?

Foreigners face significant restrictions compared to Filipino citizens when buying property in Panay Island.

Filipino citizens can own land, houses, condominiums, and commercial properties without any limitations or foreign ownership quotas. They have unrestricted access to all property types across Panay Island, including beachfront land and agricultural properties.

Foreigners cannot directly own land anywhere in the Philippines, including Panay Island. However, foreigners can legally own condominium units provided that foreign ownership does not exceed 40% of the total units in any single condominium project. Foreigners can also own the building or house structure itself, but not the land underneath it.

The 40% foreign ownership limit is strictly enforced for condominium projects. If a building has already reached this quota, additional foreign buyers must wait for units to become available from other foreign owners who sell their properties.

It's something we develop in our Philippines property pack.

Can foreigners own land directly or only through structures like leases or corporations?

Foreigners cannot own land directly in Panay Island and must use alternative legal structures to secure property rights.

The most common legal structures for foreigners include long-term land leases of up to 50 years, renewable for an additional 25 years. This lease arrangement allows foreigners to construct houses or buildings on the leased land while maintaining long-term occupancy rights.

Corporate ownership represents another viable option where foreigners can own up to 40% equity in a Philippine corporation, while at least 60% must be held by Filipino citizens. This corporation can then legally own land and property in the Philippines. Many foreign investors use this structure for larger investments or commercial properties.

Marriage to a Filipino citizen provides another pathway, though the property must be registered under the Filipino spouse's name. Inheritance also allows foreigners to own land, but they typically must sell the inherited land within a reasonable timeframe unless they qualify for permanent residency.

Special cases exist for former Filipino citizens who can reacquire land ownership rights, and pre-1935 land acquisitions may be grandfathered under certain circumstances.

What residency permits or visa requirements must be met to buy and hold property long-term?

Basic property purchases in Panay Island do not require specific residency permits, but long-term ownership benefits from proper visa status.

Tourist visas, business visas, or standard investment visas are sufficient for purchasing condominium units or entering into lease agreements. These short-term visas allow foreigners to complete property transactions without additional residency requirements.

For long-term property holding and enhanced benefits, foreigners should consider the Special Resident Retiree's Visa (SRRV) or Special Investor's Resident Visa (SIRV). The SRRV requires a deposit of $10,000-$20,000 depending on age and provides permanent residency benefits that facilitate easier property management and banking relationships.

Work visas or investment-specific visas become important when using corporate ownership structures or managing rental properties as a business. These visas provide the legal framework for active property management and income generation from Philippine real estate.

Long-term lease arrangements for houses or land often benefit from extended visa status, as it demonstrates commitment to Philippine residency and can facilitate better lease terms and renewals.

Do you need to be physically present in the Philippines to complete a property purchase, or can it be done remotely?

Property purchases in Panay Island can be completed remotely, but physical presence is highly recommended for due diligence and verification.

Remote transactions are legally possible through a Special Power of Attorney (SPA) that authorizes a trusted representative to act on the buyer's behalf. The SPA must be notarized and authenticated by Philippine consular offices in the buyer's home country.

Critical steps that can be handled remotely include document preparation, initial contracts, and final registration with the Registry of Deeds. Bank transfers for payments and deposits can be processed internationally, though some banks may require in-person verification for large transactions.

However, physical inspection of the property is strongly advised before finalizing any purchase. Remote buyers risk purchasing properties with undisclosed defects, unclear boundaries, or misrepresented amenities. Site visits also allow verification of neighborhood conditions, infrastructure quality, and actual property locations.

Working with reputable local professionals becomes essential for remote purchases. This includes hiring licensed real estate agents, qualified lawyers, and certified notaries who can provide detailed property reports and handle complex documentation requirements.

What is the step-by-step process to buy property as a foreigner, and which documents are required?

The property purchase process in Panay Island follows a structured sequence that typically takes 30-90 days to complete.

Step 1: Property search and selection based on location preferences, budget constraints, and investment objectives. Research should include neighborhood analysis, infrastructure development plans, and comparative market pricing.

Step 2: Submit a Letter of Intent (LOI) or sign a reservation agreement with the seller or developer, accompanied by a reservation fee typically ranging from 1-5% of the property price. This secures the property during the due diligence period.

Step 3: Conduct comprehensive due diligence including title verification, tax clearance confirmation, and structural inspection. Check for existing liens, pending legal cases, and proper permits. Verify that condominium projects have not exceeded the 40% foreign ownership limit.

Step 4: Prepare required documentation including valid passport, current visa, proof of income or funds source, reservation documents, and Special Power of Attorney if using representatives. Bank certificates and fund transfer documentation may be required for large transactions.

Step 5: Execute the Contract to Sell or Deed of Sale with proper legal representation. All documents must be notarized and comply with Philippine legal requirements. Payment schedules and possession dates should be clearly specified.

Step 6: Complete payment of all taxes and fees, then register the sale with the appropriate Registry of Deeds. Final title transfer or lease registration completes the ownership process.

Is it mandatory to hire a lawyer or notary, and what are the risks of skipping one?

While not legally mandatory, hiring qualified legal representation is essential for safe property transactions in Panay Island.

Notarization is required for all property contracts and deeds, making notary services legally mandatory for transaction completion. However, hiring a separate lawyer for representation and document review is technically optional but strongly recommended.

Risks of proceeding without proper legal counsel include exposure to fraudulent sellers, unclear or defective property titles, and unenforceable contracts. Many foreign buyers have lost substantial amounts to scams involving fake titles, properties with existing liens, or sellers without proper authority to sell.

Professional legal assistance helps verify property ownership, confirm tax compliance, and ensure proper document preparation. Lawyers can identify potential issues with zoning restrictions, environmental clearances, and compliance with foreign ownership regulations.

The cost of legal representation typically ranges from 1-3% of the property value, which provides significant protection against much larger potential losses from fraudulent transactions or legal complications.

What are the total costs, fees, and taxes involved in buying and later reselling property?

Property purchase costs in Panay Island include multiple government fees and taxes that total approximately 2.75-3.25% of the purchase price.

Fee/Tax Type	Rate	Who Pays
Documentary Stamp Tax	1.5% of selling price	Buyer
Transfer Tax	0.5-0.75% of selling price	Buyer
Registration Fee	0.25% of selling price	Buyer
VAT (new properties)	12% of selling price	Buyer
Legal/Agent Fees	1-3% of selling price	Buyer/Seller
Notarial Fees	₱5,000-₱15,000	Buyer
Capital Gains Tax (resale)	6% of selling price	Seller

Additional costs include property insurance, utility connections, and association dues for condominium units. Pre-selling properties from developers may require staged payments over 12-24 months, affecting financing costs.

Resale transactions involve capital gains tax of 6% on the selling price, paid by the seller, plus additional documentation and legal fees. Foreign owners should budget an additional 1-2% for currency exchange costs and international transfer fees.

Can foreigners get a mortgage in the Philippines, and if so, what are the typical rates, conditions, and insider tips?

Mortgage financing is available for foreigners in Panay Island, but approval requirements are significantly stricter than those for Filipino citizens.

Major banks including BPI, BDO, Metrobank, and HSBC offer foreign mortgages with interest rates typically ranging from 6-8% annually. Loan terms usually extend 5-20 years, with maximum loan-to-value ratios of 60-70% for foreigners compared to 80-90% for locals.

Qualifying requirements include valid long-term visa status, documented income from Philippine sources or internationally recognized employers, substantial down payment (30-40% minimum), and strong credit history. Banks often require Filipino co-borrowers or guarantors to minimize lending risk.

Insider tips for mortgage approval include establishing banking relationships before applying, maintaining Philippine bank accounts for several months, and providing comprehensive income documentation from multiple sources. Some banks favor applicants with existing investment portfolios or business relationships in the Philippines.

Corporate ownership structures can facilitate mortgage approval, as Philippine corporations have easier access to local financing than individual foreign borrowers. However, this requires careful legal structuring and ongoing compliance with corporate requirements.

We did some research and made this infographic to help you quickly compare rental yields of the major cities in the Philippines versus those in neighboring countries. It provides a clear view of how this country positions itself as a real estate investment destination, which might interest you if you're planning to invest there.

Which cities or regions in Panay have the best balance of livability, rental demand, and capital appreciation potential?

Iloilo City stands out as the premier destination in Panay Island for foreign property investment, offering the strongest combination of infrastructure, rental demand, and growth potential.

As the regional capital, Iloilo City provides modern amenities including international hospitals, shopping centers, universities, and reliable utilities. The city's expanding business district attracts both local and international companies, creating steady rental demand for both residential and commercial properties. Condominium rental yields in Iloilo City average 6-8% annually as of September 2025.

Boracay (Malay Municipality) commands the highest property prices in Panay due to international tourism demand. Short-term rental properties can achieve yields exceeding 10% during peak seasons, but the market faces strict government regulations and seasonal fluctuations. Capital appreciation has been strong historically, but environmental restrictions may limit future development.

Roxas City and Kalibo represent emerging markets with lower entry costs and growing expat communities. These cities offer good livability standards with improving infrastructure, though rental demand remains more limited compared to Iloilo City. They provide potential for capital appreciation as tourism and regional development increase.

Coastal areas outside major cities appeal to lifestyle investors but typically offer limited rental income and slower capital appreciation due to infrastructure constraints and smaller expat populations.

Where do foreigners usually settle in Panay, and why are those areas popular?

Foreign residents in Panay Island concentrate primarily in three distinct areas based on lifestyle preferences and investment objectives.

Iloilo City attracts business-oriented foreigners and retirees who prioritize urban amenities, healthcare access, and educational opportunities. The city's established expat community, modern infrastructure, and proximity to international airports make it the most practical choice for long-term residents. Popular neighborhoods include the Business Park area and Megaworld townships.

Boracay draws lifestyle-focused foreigners seeking beachfront living and tourism-related business opportunities. The island's international atmosphere, resort amenities, and English-speaking service sector appeal to those prioritizing recreational activities and social connections with other expatriates.

Coastal communities along Panay's western shores attract foreigners seeking quieter, more affordable alternatives to Boracay while maintaining beach access. Areas near San Jose de Buenavista and Tibiao offer lower living costs, natural beauty, and growing but manageable expat communities.

These settlement patterns reflect the practical considerations of healthcare access, English language services, established expat networks, and property management support that foreign residents require for successful long-term living in the Philippines.

What do the latest rental yields, tourism numbers, and growth forecasts say about investing in Panay real estate?

Panay Island's real estate market shows strong fundamentals with rental yields and tourism growth supporting continued investment appeal through 2026.

Rental yields in prime locations average 6-8% for condominium units, with Iloilo City providing the most consistent returns due to stable local demand from students, professionals, and growing expat populations. Boracay achieves higher seasonal yields of 8-12% but experiences greater income volatility.

Tourism statistics for 2024 show Boracay receiving approximately 1.8 million visitors, recovering to near pre-pandemic levels. Iloilo Province tourism grew 15% year-over-year, driven by improved air connectivity and domestic travel growth. These numbers support short-term rental demand and service sector employment that drives residential rental needs.

Infrastructure investments including the Panay-Guimaras-Negros Bridge project and expanded Iloilo International Airport capacity are expected to boost property values through 2026. Government forecasts project 8-10% annual tourism growth for Western Visayas region, supporting continued rental demand growth.

Foreign buyer interest remains stable with increasing inquiries from retirees and remote workers seeking affordable tropical living options. Property price appreciation has averaged 3-5% annually in major cities, below inflation but supported by steady demand fundamentals.

It's something we develop in our Philippines property pack.

What are the most common mistakes and pitfalls foreigners face when buying property in the Philippines, and how can they be avoided?

Foreign property buyers in Panay Island frequently encounter preventable mistakes that result in financial losses or legal complications.

1. **Attempting direct land ownership**: Many foreigners mistakenly believe they can own land through various unofficial arrangements. Always verify ownership structures comply with Philippine law and use proper legal mechanisms like long-term leases or corporate ownership.2. **Inadequate due diligence**: Failing to thoroughly verify property titles, tax payments, and legal clearances leads to purchases of properties with liens, disputed ownership, or unpaid obligations. Always conduct comprehensive title searches and obtain clearances from relevant government offices.3. **Ignoring the 40% foreign ownership limit**: Some buyers purchase condominium units without confirming the building hasn't exceeded foreign ownership quotas. Always request certification from the developer before finalizing condominium purchases.4. **Skipping professional legal representation**: Attempting to save money by avoiding lawyers often results in larger losses from fraudulent transactions or improper documentation. Always engage licensed Philippine lawyers for property transactions.5. **Misunderstanding visa and residency requirements**: Some buyers assume property ownership automatically provides residency rights or that tourist visas are sufficient for complex ownership structures. Research appropriate visa categories before structuring property investments.6. **Working with unverified professionals**: Using unlicensed agents, brokers, or notaries can result in invalid transactions or fraudulent schemes. Always verify professional credentials and licensing status with relevant Philippine regulatory bodies.7. **Inadequate financial planning**: Underestimating total costs including taxes, fees, and ongoing expenses can strain budgets and force distressed sales. Budget for all transaction costs plus 6-12 months of carrying expenses.

It's something we develop in our Philippines property pack.

Conclusion

This article is for informational purposes only and should not be considered financial advice. Readers are advised to consult with a qualified professional before making any investment decisions. We do not assume any liability for actions taken based on the information provided.

Sources

1. Emerhub - Buying Property in the Philippines as a Foreigner
2. Respicio Law - Foreigner Acquiring Land in the Philippines
3. Lawyer Philippines - Permanent Visa and Property Purchase
4. TransferGo - Buying Property in the Philippines
5. Ziggurat Real Estate - Ways Foreigners Can Own Real Estate
6. Buch Dein Visum - Real Estate in the Philippines
7. Wise - Buy House in Philippines
8. Kittelson Carpo - Property Ownership