Tourist arrivals to the Philippines increase

Coconut trees overlooking the sea in Cebu
in the Philippines

According to the Central Bank of the Philippines, between January and October last year, the number of tourists visiting the Philippines increased by nearly 4% compared to 2007.

Considering the fact that this Southeast Asian island country offers a combination of a tropical climate, low cost of living, thriving economy and good accessibility, it is not hard to see why the Philippines is proving to be such a popular destination, with Goldman Sachs' 'Next Eleven' paper tipping the Philippines as a country which has the potential to become one of the world's biggest economies in the 21st century.

The Philippines, named after King Philip II of Spain, is made up of over 7,000 islands in the western Pacific Ocean. It has a population of 90 million, with the two official languages being Filipino and English (although around 180 languages are spoken across the islands).

Philippine culture is a mix of pre-Hispanic Austronesian (Malayo Polynesian) civilisations, Hispanic and American culture and, to a lesser extent, Chinese, Arab, and Indian cultures.

Following a period of martial law from 1972, the People Power Revolution of 1986 led the country back to the thriving democracy it is today. Turbulence in the late 1980's gave way to stability and economic growth in the 1990's.

The Philippines is regarded as a newly industrialised country which now receives substantial contributions from mining and manufacturing sectors as well as remittances from overseas Filipinos. Tourism is very important as is, increasingly, outsourcing from international businesses.

The Philippines is said to subsequently represent an exciting alternative to traditional investment property destinations in the West, particularly given recent economic developments. According to a recent World Bank report, the Philippines is in a good position to ride out current difficulties thanks to fiscal and other reforms during the past several years.

Continued strong performance in construction and private investments and better than expected crop harvest yields were all cited in the report. There was also higher manufacturing output and continued remittance from the 8 million Filipinos who work overseas.

Such economic resilience is likely to lure increasing international investment into the property market. Demand from Europe, Russia and the United States for city centre and resort properties has been brought about thanks to cheaper prices and the requirement from investors to move their money into strong emerging markets.

Investors are looking for investments with the potential for high monthly rental yields and developments which are run as managed resort hotels, increasingly seem a sound investment.

Philippine hotel rates are on a par with the US or Europe, whilst entry level purchasing prices for freehold property are much lower. A deposit on a new fully furnished, five star apartment or villa for example can be as low as £2000.

Mactan Island, subject to much developer interest, is located in part of the central Philippine province of Cebu in the Bohol Strait. Thanks to the Mactan-Cebu International Airport and its proximity to Cebu, the area's tourism industry has boomed significantly with the local economy feeling the positive effects. Recently, a further £4 million of investment in the airport has been announced, together with the planned addition of another terminal due to the increasing volume of air traffic.

Overseas investment property specialists, Experience International, are currently marketing the Blue Coral Resort and Spa on Mactan Island.

"Our development on Mactan Island is ideal for property purchasers or investors who are disappointed with the returns on traditional investments and who want to look abroad towards exciting emerging markets," explains Steve Worboys, Experience International's managing director.

"Our properties, to be run as part of a fully managed resort, will allow purchasers or renters to experience the best of life in the Philippines, surrounded by a plethora of facilities. These will include 26 spa rooms, a gymnasium, water sports, diving school, wellness spa, health pools and a private beach.

"The 'credit crunch' has affected the Philippines to a much lesser extent and given the local price of property and the increasing demand for accommodation in the area, we estimate that properties taking part in our rental management scheme will yield 19.5% per year and up to 150% return on investment over 5 years. These numbers, together with all the other benefits, make investing in the resort seem like simple common sense."

For more information, visit www.experience-international.com

Information courtesy of AB Property Marketing Ltd., and Experience International

© PropertyIndex.com 2009 | Last Updated: 6th January 2009