Foreign Ownership Restrictions
RestrictivoThe 1987 Philippine Constitution (Article XII) reserves land ownership exclusively to Filipino citizens and corporations that are at least 60% Filipino-owned. Foreigners can own condominium units but not land. Understanding these constitutional restrictions is essential before investing.
- Foreigners CAN own condominium units freehold -- but only up to 40% of the total floor area or total number of units in any condominium project can be foreign-owned (Republic Act No. 4726, the Condominium Act)
- The 40% foreign ownership cap is strictly enforced -- developers track this ratio and will refuse sales to foreigners once the cap is reached
- Foreigners CANNOT own land directly under any circumstances (1987 Constitution, Article XII) -- this means house-and-lot properties are off-limits for outright foreign ownership
- LEASEHOLD: Under the newly amended Investors' Lease Act (RA 12252, signed September 2025), foreign investors can now lease private land for up to 99 years (previously 50+25 years), with rights to sell, transfer, assign, or use the lease as loan security
- Leasehold agreements under RA 12252 require approval from the DTI-Board of Investments or relevant Investment Promotion Agency, and all investments must be registered under the Foreign Investments Act
- Marriage exception: A foreign spouse of a Filipino citizen can co-own land with their Filipino spouse (but cannot own it solely in their name)
- Hereditary succession: Foreigners may inherit land, but this is a narrow exception and subject to legal interpretation
- Condominium ownership is the primary and recommended vehicle for foreign freehold property investment in the Philippines
