Are you looking for an investment? If so and you are tired with the roller coaster ride of the stock market, or do not want to waste your time with the minuscule returns offered by institutional term deposits, it might be time to invest in the “bricks and mortar” industry. We can help you with a range of high return options with minimal risk. Here are some which you might want to consider:
Private Real estate Mortgages
As our clientele is in the vast majority foreign expats, we consistently run into a problem. Filipino banking institutions just do not want to lend to foreigners, regardless of their past credit history or their ability to repay the debt. This has created a very lucrative niche market for lending. Typically, we will set up a potential buyer with a private lender, and can mediate a loan structure that can benefit both parties. With this type of investment, usually loan amounts range form 2-5 million, correspond to approximately 50% of the equity in the property (or sale price) and return achieved is in the 8-12% per anum range. All mortgage loans are secured by a Real Estate Mortgage on the home purchased.
Spec Home Financing
Since our major problem is not lack of clients, but rather a shortage of units to sell to them, we are always interesting in ways we can increase our sale home inventory. If we can build more homes, we will sell more homes so on a limited basis we have taken on debt financing to do so. With this investment option, typically our company agrees to borrow from a private lender sums in the range of 1-3 million pesos. The loans are structured for one year, interest only payments in the 12% range, with repayment of the principle upon the year anniversary, or whenever the spec home is sold. (Whichever is earliest) If the home is sold before its term comes due, we pay off the loan immediately, and pay the lender a bonus payment equal to 50% of the interest that would be paid if the loan went to term. Again, any money borrowed is secured by a Real Estate Mortgage on the house and lot that it relates to.
Our Joint Venture Partnerships tend to be larger than our niche market communities, and for this reason we openly seek equity investors. Though this type of investment will not provide substantial returns in the short term, over the long term, returns will conceivably be much higher. A successful real estate development should earn a return of 200-300% over 5 years so if you are looking at the long play, this option might be most attractive