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With its tropical islands, English-speaking communities, and growing economy, the Philippines has become a prime destination for foreign investors, retirees, and long-term visitors. However, foreigners are not permitted to own land outright under Philippine law.
That said, leasing presents a legal, flexible, and secure alternative for foreigners who want to reside in, invest in, or develop real estate in the Philippines—without breaking the law.
This guide walks you through everything you need to know about leasing property in the Philippines as a foreigner, including lease types, legal rights, contract terms, and precautions for 2025 and beyond.
Foreigners can legally lease:
Residential units
Condominium units
Houses and lots (the land, via lease)
Commercial or agricultural land (for business purposes)
RA 7652 allows foreign investors to lease private land for a period of up to 50 years, renewable once for an additional 25 years, provided the land will be used for:
Investment projects
Tourism or hospitality ventures
Residential development for expats
In contrast, personal/residential leases (non-investment) are usually regulated under the Civil Code, allowing up to 25 years (renewable).
Lease Type | Term Allowed | Legal Framework | Notes |
---|---|---|---|
Short-term residential | 6–12 months | Civil Code | Common for condos, apartments |
Long-term residential | 25 years + renewal | Civil Code | For private home lots via lease |
Investor lease | 50 + 25 years | RA 7652 | Requires investment declaration |
Condominium leasing | Flexible (no limit) | Condo Act, Civil Code | Lease or sublease, no land title needed |
Residential (e.g., long-term stay or retirement)
Business (e.g., hotel, restaurant, BPO center)
Real estate development (e.g., eco-resort)
Houses with land (lease land, own structure)
Condo units (easiest and safest for expats)
Raw land for commercial lease
Make sure it includes:
Full names of both parties
Property description and title details
Lease term and renewal conditions
Rent amount and payment schedule
Security deposit and return conditions
Rights and obligations of both parties
Restrictions (e.g., subleasing, renovations)
Contracts exceeding 12 months must be:
Notarized
Registered with the Registry of Deeds
Registration protects your leasehold rights
Yes, a foreigner may lease a piece of land and build a structure (like a house or villa) on it. The foreigner owns the building, but not the land.
The lease agreement should state that the building remains the lessee’s property.
Upon lease expiration, the lease must specify who retains the building (lessee or lessor).
If not specified, the building may legally revert to the landowner.
Clause | Why It Matters |
---|---|
Duration | Defines how long you may stay or operate on the land |
Rent & Payment | Prevents future disputes over costs |
Use of Property | Residential, commercial, agricultural, etc. |
Renewal Terms | Ensures continuity beyond the original lease |
Assignment/Sublease | Whether you can transfer the lease or rent it out |
Improvements Clause | Ownership of buildings or enhancements |
Termination Clause | Outlines the process if either party ends the lease early |
Dispute Resolution | Specifies legal remedies and jurisdictions |
Feature | Lease | Ownership (Filipino only) |
---|---|---|
Land Control | ✅ Yes (limited term) | ✅ Full |
Title Rights | ❌ No title | ✅ Yes |
Legal Risk | ✅ Legal workaround | ❌ Not permitted for foreigners |
Investment Use | ✅ Long-term business use | ✅ Full use |
Asset Value | ❌ Non-transferable title | ✅ Appreciating asset |
A foreign retiree leases a lot in Cebu and builds a home.
Lease: 25 years, renewable.
Registered, with a clause stating building ownership.
A foreign investor leases beachfront land in Palawan for a resort.
Lease: 50 years, under RA 7652.
SEC and LGU permits required.
A foreign expat signs a 1-year renewable lease for a furnished condo in Makati.
Governed by Civil Code and Condo Corporation bylaws.
The lessee must vacate unless a renewal is agreed upon.
If the lessee built a structure, ownership terms must be clear in the contract.
If not renewed, and no buyback clause exists, the landowner may claim improvements.
Always use a licensed lawyer to draft and review your lease.
Register leases longer than 1 year with the Registry of Deeds.
Avoid verbal agreements — get everything in writing.
Check the property title to confirm ownership before signing.
Clarify property taxes — usually paid by the lessor, but confirm this.
Include succession plans if you plan to stay long-term (e.g., assign rights to spouse or corporation).
Yes. Foreigners may incorporate a company in the Philippines and lease land in the company’s name. This is useful when:
You want to operate a resort, hotel, or commercial center.
The land is zoned for business use.
The lease term needs to exceed 25 years.
SEC registration
Mayor’s permit
Business plan submission
60/40 ownership rule applies for land acquisition; but not for leases
Lease Type | Term | Notes |
---|---|---|
Residential condo lease | 1–3 years | Standard furnished condo rental |
Private land (residence) | 25 years + 25 renewal | Used for personal homes |
Commercial lease | 50 years + 25 renewal | RA 7652 – requires investment purpose |
Agricultural land | Max 25 years | Subject to DAR rules, lease only |
Pitfall | Solution |
---|---|
Verbal leases | Always demand a written, notarized contract |
Unregistered contracts | Register leases over 1 year with Registry of Deeds |
Fake land titles | Verify ownership via Registry and tax receipts |
No improvement clause | Explicitly state building ownership in contract |
No renewal provision | Add automatic renewal clause or option for extension |
While land ownership is off-limits for most foreigners in the Philippines, leasing remains a secure and practical path for establishing long-term residency, building a home, or launching a business.
By understanding the legal framework, structuring your lease agreement carefully, and seeking professional assistance, foreigners can enjoy long-term property use rights without violating Philippine law.
In 2025 and beyond, with property prices rising and infrastructure improving across major islands, strategic leasing is a powerful tool for expats, entrepreneurs, and retirees looking to build their future in the Philippines.
Yes. Foreigners can lease land in the Philippines under the Civil Code or the Investor’s Lease Act (RA 7652). Lease terms may range from short-term rentals to 50-year contracts for investment purposes.
Foreigners may lease private land for up to 50 years, renewable once for 25 years, under RA 7652. Residential leases (non-investment) are usually capped at 25 years with an option to renew.
Yes. A foreigner can lease land and construct a house or other structure on it. The lease agreement should clearly state that the lessee (foreigner) owns the building, not the land.
Leasing is the legal and safe way for foreigners to use property long-term. With a notarized and registered lease, your rights are protected under Philippine law.
Yes. Any lease contract longer than 12 months must be notarized and registered with the Registry of Deeds to be enforceable against third parties.
Leasing gives temporary rights to use a property but not legal ownership or title. Ownership allows full rights and transfer of title. Foreigners can lease but cannot own land outright.
Yes, but terms must be clearly stated in the contract. Either party may terminate early under agreed conditions, such as breach of contract or mutual consent.
Leasehold rights may be assigned or subleased only if allowed by the lease contract. Written consent from the lessor is typically required for such transfers.
Yes, but with strict regulations. The Department of Agrarian Reform (DAR) oversees agricultural leases. RA 7652 allows foreigners to lease such land for approved investment purposes.
Republic Act No. 7652, or the Investor’s Lease Act, allows foreign investors to lease private lands for up to 50 years (renewable for 25 years) if the land is used for business or development.
Yes. It is strongly recommended to work with a licensed lawyer to draft or review the lease agreement to ensure it meets legal requirements and protects your rights.
A lease contract should include names of parties, property description, lease duration, rent amount, payment schedule, renewal terms, maintenance responsibilities, and improvement clauses.
Absolutely. Condominium units are the easiest properties to rent or lease for foreigners in the Philippines. You can sign short-term or long-term lease agreements directly with unit owners.
If the lease is registered, it remains valid even if ownership of the land changes. The new owner must honor the lease under its existing terms.
You must vacate the property unless a renewal has been arranged. If you constructed improvements, ownership or compensation should be outlined in the lease contract.
Yes. Foreigners can lease land for commercial purposes (e.g., hotels, resorts, retail) under RA 7652, provided the investment is registered with appropriate government agencies.
Subleasing is only allowed if explicitly permitted in the lease contract. Unauthorized subletting may be grounds for termination of the lease.
Rates vary by location and purpose. Urban land leases can range from PHP 10,000 to PHP 200,000+ per month, depending on the area, size, and intended use.
Typically, the landowner (lessor) is responsible for paying real property taxes. However, some contracts may assign this responsibility to the lessee. Always clarify this in writing.
Only if the lease contract includes an automatic renewal clause or an option to renew. Otherwise, a new lease must be negotiated with the landowner at the end of the term.