As the Philippines's second largest island, Mindanao ranked as the 7th most populated island worldwide. The "Philippines Pioneer Frontier" features vast areas of fertile land that remain untouched. Mindanao is also named the "Land of the Promise" — thanks to its abundant natural resources. Although often branded as a terrorist nest, this region is home to one of the safest cities in Asia. Additionally, Mindanao has recently undergone expansion and transformative infrastructure development worth P2.4 trillion to rise in the region.
 
That’s why investors should take advantage of this situation and consider investing in the region beforehand. Here are the best locations to invest in real estate in Mindanao, Philippines:
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Best Locations to Invest in Real Estate in Mindanao

1. Cagayan de Oro City

Referred to as the Metro Cagayan de Oro, CDO ranks as the 4th largest urban area in the Philippines. Cagayan de Oro City is also considered one of the happiest places in the Philippines due to its friendly and welcoming people. It is a paradise for adventurers, offering endless adrenaline rush activities, from trekking and spelunking to white water rafting and game fishing. Apart from that, real estate experts recommend buying a property in Cagayan de Oro due to the expansion of the BPO industry and high-impact infrastructure development.
 
It includes the Laguindingan Airport and the CDO's Passenger Terminal Building (PTB), the largest of its kind in the country. Cagayan de Oro does not fall short in terms of education. It is home to excellent institutions, like Capitol University, Liceo de Cagayan University, and Xavier University-Ateneo de Cagayan. Cagayan de Oro also has plenty of fertile land and open spaces for those who want to invest in agriculture or build a house.

2. Davao City

Davao City is the best location to invest in real estate in Mindanao if concerned with safety and stability. As surprising as it seems, Davao City ranked as the 2nd safest place in Southeast Asia based on Numbeo’s Southeast Asia Safety Index 2023. It obtained a 72.4 safety index, ranking second to Chiang Mai City, Thailand. This highly urbanized city also acts as the central hub of commerce, trade, and industry in the Davao region. It is accessible through air and sea transport with an expansive bus system, allowing you to travel comfortably to major cities in Mindanao and Manila.
 
Dubbed the "Durian Capital of the Philippines," Davao City's economic performance is comparable to Manila since it is leading in various industries. It has a booming agriculture and is home to major companies, including Holcim Philippines, Coca-Cola Bottlers, Pepsi-Cola, RC Cola Philippines, and Phoenix Petroleum. Davao also boasts the highest mountain in the Philippines, Mount Apo, which contributes to the success of its tourism. Lastly, the city has some of the best universities in the country, including the University of Mindanao and Ateneo de Davao University.

3. Iligan City
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After Cagayan de Oro, Iligan is the 2nd most populated city in Northern Mindanao, where you'll find scenic waterfalls. The "City of Majestic Waterfalls" serves as the Industrial Center of the South as the whole Mindanao region benefits from the hydroelectric power generated from the Maria Cristina Falls. Iligan City also has hidden gems, from natural lakes, springs, and caves, the perfect place for thrill-seekers. Furthermore, Iligan is a highly urbanized area accessible via sea and air transport.
 
Several developments that promote sustainability and better quality of life are evident in the city, including Smart initiatives and livelihood cooperation. Investing in manufacturing will also bring more profit to investors since Iligan is leading in this industry. Thus, investors are encouraged to purchase real estate investments in Iligan City.

Formerly known as Maynilad, Manila is located in the National Capital Region on the island of Luzon, Philippines. It is also called the “Pearl of the Orient” for its natural beauty and rare pearls that lie in its sea. In addition, Manila is the country's main hub of economic, cultural, and diplomatic ventures. This bustling city also has new large-scale infrastructure projects set to be completed in the following years that will positively affect its economy.
 
Just recently, Manila’s housing market ranked first globally for value appreciation in the first quarter of 2024. Real estate experts believe this recognition will attract more investors to the city.

World Housing Prices Rise Annually by 4.1%

During the first quarter of 2024, the Global Cities Index increased an average of 4.1% annually. This growth rate comes from the global real estate consultant Knight Frank Prime, which covers 44 housing markets. In the third quarter of 2022, almost all central banks implemented a strict monetary policy, and interest rates skyrocketed. Experts consider it the highest growth rate since 2022. Furthermore, a price growth of 0.3% has been recorded in Q4 2023 and surged by 1.1% in Q1 2024.
 
However, the COVID-19 pandemic caused the annual growth rate to drop from zero. So, although housing prices increased by 4.1%, it is still below the average annual growth rate. Nonetheless, experts recorded a 1.3% quarterly growth, conforming with the long-term average return. In the recent ranking of 44 cities, annual price growth is evident in 78% of the market, and 19% are experiencing depreciation. 9 cities were also going through a 5% price decline during the first quarter of 2023.
 
In Q1 2024, only the Frankfurt housing market experienced a price decline. Global experts state that the housing markets are going through a rebound as the annual growth rate reached 4.1%. On the contrary, the Global Cities Index does not indicate a flourishing situation. Instead, it suggests that the surging prices are due to low supply but high demand. 

Manila Hailed as World’s Top Housing Market

Mean while, Manila was hailed as the world's top housing market for 2024 in terms of price appreciation. Based on the Knight Frank Prime Global Cities Index Q1 2024, Manila reached an annual growth of 26.2%. Second on the list is Tokyo, reaching an annual growth of 12.5%. Other major cities also witnessed solid growth. Mumbai reached 11.5%, Perth 11.1%, and Delhi 10.5%.
 
While other cities are far more developed, Manila’s impressive economic performance and transformative infrastructure have boosted the growth rate of the city’s housing market. Thus, investors will benefit from this situation, especially those planning to capitalize on rental properties.
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Robust Expansion in Major Cities Worldwide

Aside from that, the housing markets of other major cities worldwide are witnessing solid growth. For instance, Seoul reached an annual growth rate of 9.6%, Dubai at 8.6%, Los Angeles at 8.3%, and Madrid at 7.6%, taking the 10th spot in the Global Cities Index Q1 2024. These figures indicate healthy growth in various housing markets.
 
In contrast, weak housing markets continuously record negative growth due to high interest rates, influencing real estate affordability. Hence, investors around the globe are encouraged to invest in Manila’s real estate since it guarantees promising investment returns and capital appreciation. 
 
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One of the top things to consider when buying a house in the Philippines is the property's location. Whether purchasing your dream home or planning to make money out of residential real estate, choosing the right location is a critical decision. It will determine the property's value, safety, and accessibility. The location contributes to the property's potential appreciation and profitability, which you should consider whenever investing.
 
If you're planning to purchase your first-ever home or relocate, read on as we've rounded up the top places to buy a house in the Philippines.

Top 8 Places to Buy a House in the Philippines

1. Baguio

Nestled in the Benguet province, Baguio is one of the top tourist spots in the Philippines – famed for its cool climate and verdant surroundings. The “Summer Capital of the Philippines” is a great place to buy real estate since the city has a booming tourism, hospitality, and agriculture industry. It is also known for its safe neighborhoods and outstanding schools, making it a suitable place to live.

2. Cavite

Buying a house in Cavite will make a good investment, considering its proximity to Metro Manila. Many homeowners and investors buy real estate in Cavite as it perfectly blends rural charm and urban development. Its prime location offers seamless connection, accessibility, and a strong economy. Hence, investing in Cavite gives access to various opportunities and promising investment returns.

3. Cebu

Dubbed the "Queen City of the South," Cebu is undeniably one of the top places to buy a house in the Philippines — thanks to its rich culture and stunning white beaches. Cebu is also a great place to invest in real estate because of its thriving tourism, emerging business hub, impressive infrastructure advancement, and stable rental income.

4. Davao

If you're considering relocating somewhere in Mindanao, we recommend investing in Davao's real estate scene. Despite being miles from Metro Manila, Davao is one of the best places to live in the Philippines. It acts as Mindanao's primary commerce, industry, and trade center. Besides its natural wonders and agriculture, Davao is considered a safe place to live.

5. Iloilo

Iloilo is another prime location to consider when investing in Philippine real estate. Located on Panay Island, this city is famous for its Spanish colonial churches and classical houses. It has an increasing urban population and rapidly developing businesses, from tourism, agriculture, and the BPO sector. Investors can also enjoy competitive rental and favorable returns.

6. Makati City

​As the country's economic hub, buying a property in Makati City is a wise investment. Considered the "Financial Capital of the Philippines," Makati is home to about 40% of local and multinational corporations' headquarters, as well as foreign embassies and consulates. Aside from its sturdy economy, Makati features excellent infrastructure, which attracts local and foreign investors.

7. Quezon City

Quezon City is the perfect place to invest for those in the media, entertainment, and information technology industry. This city will also make a great place to live since it is home to some of the most prestigious schools in the country and leading healthcare facilities. Thus, investing in Quezon City guarantees annual land appreciation and lucrative rental income. 

8. Metro Manila

Despite being densely populated, the capital of the Philippines is undeniably one of the best places to buy real estate. Metro Manila is known for its continuous development, robust economy, extensive infrastructure, and diverse business options. Therefore, owning a house or even a piece of land in Metro Manila is sure to bring profit.

When you start any business, there are many factors you should consider before you kick off your plans. The same goes for those investing in real estate. These factors can help you decide if a property is worth investing in. In addition, it will help investors determine if the property can bring more profit and has the potential to appreciate in the future.
 
So, read on as we’ve listed the factors to consider when buying real estate in the Philippines.

Factors to Consider When Buying Real Estate in the Philippines

Location & Safety

One of the top factors to consider when buying real estate in the Philippines is the property’s location, which determines safety and ambiance. If you’re buying a home to build a family, find a neighborhood with high police visibility and a low crime rate. Also, prioritizing location and safety is vital if you’re considering entering the rental property business.

Cost & Maintenance

But before you go on real estate tripping or visit an open house, let's discuss your current finances. It is a critical factor since your income will dictate your purchasing power. Owning a property also involves various expenditures, from moving to the place to maintenance and other relevant fees. Thus, it is essential to determine your budget to prevent financial issues.

Type of Property

Another factor to consider is the type of property you’re looking for, ensuring it meets your needs and purpose. For instance, you can buy a residential property with ample space for kids to play around if you have a family. If you’re into a minimalist lifestyle, consider a condominium unit. But if you want a laid-back life, go for farm lots or a beach house.

Schools

Aside from location, you should consider investing in real estate properties near school districts. It will benefit homeowners with a growing family, making it convenient for kids to attend school. If you’re into a commercial or retail industry, having schools and universities nearby will benefit your business. You will also reap competitive rental rewards since your property will have a high occupancy rate if you rent it out.

Accessibility

Ease of access to everyday essentials is also a factor to consider when buying a property. Regardless of purpose, you should purchase a property proximate to hospitals, schools, shopping malls, restaurants, and even houses of worship. Additionally, properties close to extensive infrastructure, such as railways, airports, and other transport terminals, ensure a comfortable and convenient life.

Environmental Risks

Investing in anything always comes with risks, whether it's a business or property. However, you can minimize it by considering external factors, such as environmental risks. Aside from avoiding neighborhoods with high crime rates, you should evaluate if the property’s area is susceptible to natural disasters, like earthquakes and flooding. By doing so, you can reduce repair expenses and enhance the stability of your investment.

Potential Profit & Capital Appreciation

When buying a home, consider the potential of your investment for capital growth, which means you should look for properties in areas currently undergoing advancement or have been forecasted to expand eventually. If you invest in these locations, you will most likely enjoy a promising investment return. Hence, don't only consider the property's location. But also assess its effect on the property's value in the future.

Conclusion

​Overall, these factors have significant effects on your investment. It will dictate whether your investment will be profitable or futile. Furthermore, these factors apply to any real estate, from residential, commercial, or mixed-use properties. Therefore, investors and future homeowners must consider these factors to get a great deal and avoid financial difficulties while investing.

Real estate investment is one of the safest and most guaranteed ways to generate profit despite the economic conditions and dynamic market. There are various options when investing in real estate, from renting a condo and commercial unit to flipping houses. However, if you have limited finances and can’t purchase a property, consider investing in REIT Philippines.
 
In this article, we will discuss what Real Estate Investment Trust (REIT) is all about, how it works, and why you should invest in this passive income.

What is REIT

Founded based on the Revised Corporation Code of the Philippines, Real Estate Investment Trust (REIT) is a stock corporation that owns real estate assets generating revenue. REIT adheres to the Securities and Exchange Commission (SEC) rules and regulations. It includes various properties, such as apartment buildings, hotels, resorts, shopping malls, office spaces, hospitals, medical facilities, and warehouses. Due to their high returns, lower risk, and diversity, many investors opt for REITs.
 
Here, investors can earn from the rental income and other relevant fees from real estate assets. Then, it is allocated as REIT dividends. In a nutshell, REIT investors will earn from rental income and become part-owners of the real estate property. Therefore, you can earn passive income in REIT without buying an actual real estate asset or investing a huge amount of capital. However, based on prevailing laws and regulations, REIT is not similar to "trust." This term is only designated to adapt to the company's globally recognized description.

How REIT Works in the Philippines

As stated, investing in REIT Philippines provides rental income since most of these real estate assets are leased out. The company will generate profit and distribute the earnings of investors via dividends. But before it happens, a REIT corporation should collaborate with a Sponsor offering and transferring revenue-generating real estate assets. In return, the Sponsor will obtain ownership of the REIT corporation.
 
The Sponsor should barter at least ⅓ of the REIT's outstanding capital stock to public investors in adherence with SEC REIT Implementing Rules and Regulations (IRR). SEC also requires the reinvestment of sales proceeds within the country. Another benefit of investing in REIT is that companies are required by law to distribute at least 90% of their gross income to investors.
Entities Implementing REIT Rules and RegulationsApart from SEC IRR, the following entities must be appointed in REIT Philippines:

• Fund Manager – This entity is responsible for implementing the REIT investment plan. It also supervises the financial reports, acquisitions, leasing, and operation of properties.
• Property Manager – The REIT Property Manager determines prospective tenants and plans their combination. This entity plans and implements leasing policies and ensures the maintenance of real estate assets' physical structures.
• Property Valuer – It is tasked to fulfill the REIT asset's full valuation and generate appraisal reports.

Why Invest in REIT

In the Philippines, Filipinos, foreign residents, and licensed corporations can invest in REITs. Furthermore, it is recommended for first-time investors or those looking for conservative to moderately risky investments that offer solid dividends, stable continuous profit, and long-term capital gain. To invest, you can subscribe or buy shares of REIT stock. This investment is also safe and regulated by Republic Act (RA) 9856, also known as the Real Estate Investment Trust (REIT) Act of 2009. Hence, buying REITs in the Philippines is a guaranteed way to generate passive income.