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Why do expats charge US rent prices in the Philippines?!

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Winston
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Why do expats charge US rent prices in the Philippines?!

Post by Winston » October 26th, 2010, 12:20 pm

Ladislav or anyone else:

Check this out. Why is it that whenever expats in the Philippines are renting out a place or a house, they usually charge overinflated prices close to what you pay in the US?! Are they crazy? Who would come to the Philippines to pay US prices? Isn't one of the main reasons to retire to the PH to pay much lower prices? What kind of insane logic is this? Does greed F up these expats' heads?

Here is one example where the guy is charging 30,000p to rent out a house in Davao, which is supposed to be one of the cheapest places to live in the Philippines:

http://realestate.liveinthephilippines. ... -for-rent/

Also, look at the book he's selling called "49 Ways to Make A Living in the Philippines", priced at $49 (haha). The author claims to be making $20,000 USD in the Philippines! Yeah right. He even shows part of his bank statement to try to prove it to us. Have a look at it in the link here.

http://liveinthephilippines.com/content ... ilippines/

The bank statement says that he spends $19,000 a month which leaves him $1000. Now why would anyone need to be spending $19,000 a month in the PH? For what?

Do any of you believe him?

Also, usually when you brag publicly about your successes or income, it creates a karmic backlash or jinx that reverses your luck. Thus most people who are lucky or successful do not like to boast about it publicly. So why would he do that?

Isn't this an example of what I'm talking about, when I say that many guys love to inflate numbers in both their income and expenses? For some reason, a lot of guys do that. They exaggerate their income and what they spend on this or that, etc, and act with a know-it-all attitude. Every number in their lives is hugely inflated. They always claim to be living an EARN BIG AND SPEND BIG lifestyle.

Why do so many guys do that? How come I don't do that?

As for me, I'm happy to claim that I earn little and spend little. Nothing wrong with that.
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momopi
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Post by momopi » October 26th, 2010, 7:02 pm

A fool and his money are soon parted.

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Post by MrPeabody » October 26th, 2010, 10:16 pm

It's called marketing - a polite word for lying.

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Post by ladislav » October 26th, 2010, 10:45 pm

You know what 'greenhorn' means? A naive newcomer. And sometimes the one who rips him off the most is not one of the locals but the ones who had come before him. Some of the largest scams pulled off on newcomers are by foreigners who had been living there for sometime.
And with fellow foreigners in a strange land, the greenhorns tend to let the guards down and this is when they get them.

Having said that, some established expats like to create high quality products and services to sell them to foreigners, and some guys prefer quality over rock bottom deals. They want Western standards and security at prices that are still lower than back home.

So, instead of renting a $1200 apartment in LA, they rent a $700 apartment in Manila with all the same amenities. It is still a bargain to them.
Instead of dishing out $300,000 for a house in Orange County, they may think that buying a house for $75,000 in Angeles City is pretty good and it is secure. And instead of buying a Mercedes for his girlfriend for $50,000, he buys a motorcycle for $5000.

The same goes for P4P. Not all guys want a $25 hooker. They may pay $100 for one quality night and it is still a bargain because back home a masculine, druggie hooker will charge $300 for one hour.

Not all people like to live in $60 apartments with cockroaches, bugs, no security and in a bad area where drunk neighbors wail off key with their karaoke machines until 3 AM, and where roosters start crowing at 4:30 AM. Not all want to eat $0.60 meals. Not all like to argue with pimps to get a hoe for $5 a pop. And not all like to ride shoddy taxies and fight with drivers over every centavo. Some guys still want quality life that is 30-40% less and that is good enough for them.

Some guys do have money, you know.
Last edited by ladislav on October 26th, 2010, 10:54 pm, edited 3 times in total.
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Post by Winston » October 26th, 2010, 10:49 pm

Well then he's a terrible lying and not an intelligent one.

A lie has to be believable to succeed. If I were going to pull a lie, I'd make sure it was believable and that I couldn't be found out, cause once you are found out, you lose all credibility.

But this lie also has no logic. I mean, expats retire to the Philippines cause they can live cheaply with more buying power. No one would retire to the PH and expect to pay US prices for rent. Thus there is no strategic logic in this lie.

It's just stupid greed isn't it?
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Post by Winston » October 27th, 2010, 2:52 pm

Here is his proof that he makes $20,000 USD a month in the PH. So convincing huh? I ought to use this to prove that I make 20k too. lol

Image

Image
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Post by momopi » October 27th, 2010, 5:23 pm

If he made $20k income and withdraw $19k from bank account, that's not an indication that he actually spent it. It's possible that the funds were transferred elsewhere.

But if he took in $20k and spent $19k on google adwords, then his income is actually only $1k. But we're just speculating here.

As for ripping off newcomers, the worst offenders in Shanghai who rips off recently-arrived Taiwanese workers & businessmen, are not the local Mainlanders. The worst cheats are Taiwanese who moved there earlier and failed in their ventures, and now resort to cheating new arrivals with promises of quick and large returns. They'd befriend you as a fellow Taiwanese, then take your money and run.

The basic market value of real estate, is dependent on supply and demand. In California, this means a beach-side condo will cost more than an in-land house. In Philippines, it means anything built by Ayala will probably cost more than other builders. A no-name builder trying to sell pre-build condos simply don't have the same reputation as Ayala.

Home prices are limited by the income of potential buyers. Theoretically, if you had a monopoly over housing in a given area (see: Irvine company), you could charge $100 million for a house and $1 million per month for rent. But if nobody could realistically afford such prices, then you'd have zero customers.

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Post by Rock » October 27th, 2010, 10:36 pm

Winston, a couple issues to consider:

1. Real estate prices driven by supply and demand. General cost of living not necessarily a good proxy for real estate costs at the high-end. For example, a decent house on outskirts or Port Au Prince (sp) Haiti can be priced at over US$1 mn and rents are several thousand a month. The earthquake destruction and influx of overseas aid workers, etc. led to a collapse in supply and jump in demand. I've heard prime properties in Mumbai are outrageously expensive too but haven't checked it out.

2. Not all expats come to Phils or Thai for cheap cost of living. Personally I'm motivated by higher-end living. About 5 years ago (when Baht was weaker), I could purchase a modern luxury 70 sqm condo in prime Bangkok location with a parking space for around US$150-200K. The common areas would include a swimming pool, fitness center, shops and restaurants and would have easy access to BTS. A similar level of condo in comparable location in Taipei would cost 2-3 times that and in Manhattan, at least 6-8 times. Moreover, Thailand or Phils offers much better social options which might be the key motivator for a lot of people, not just cost. I definitely agree with Lad about not wanting to slum-out here. I would prefer to enjoy a high quality of life at extremely good value for money.

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Post by Repatriate » October 28th, 2010, 5:52 am

Rock wrote: About 5 years ago (when Baht was weaker), I could purchase a modern luxury 70 sqm condo in prime Bangkok location with a parking space for around US$150-200K. The common areas would include a swimming pool, fitness center, shops and restaurants and would have easy access to BTS.
You still can and I looked into the option at one point but decided that it's still much cheaper to rent. The Thai-american friend of mine got married and bought a very nice condo in the trendy upscale Thonglor area for only around 6 million baht. His condo has 3 bedrooms and is tastefully renovated with wood floors and is over 90sqm.

The building is very well maintained and close to the BTS as well. There are quite a few good deals if you want to marry/raise a family in Bangkok. For a single dude or someone in a long term relationship without kids it's still cheaper to rent.

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Post by globetrotter » November 1st, 2010, 12:34 pm

Americans are accustomed to paying those prices and trust an American more. Language, experience, local knowledge and know-how go a long way.

White, Anglo-Saxon, Protestant Americans are the most cut-throat group on this planet. Even when they expat to another country, they don't look out for each other and will slit each others throats to make a dollar. In the US they don't stick together at all. This is one of the crazy RadFem ideas that drives most MRA types nuts; Men don't look out for each other, they are trying to rip each other off.

I don't get bothered by these liars, con artists and sociopaths, but then again I radiate a 'Don't f**k with me, I have seen it all' vibe. They move on and look for an easier kill.

This works if there are rules to play by. Competition makes many rich and most middle class. Remove the rules, however, and then you get the Current Collapse.

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Post by Winston » November 1st, 2010, 2:52 pm

Even if I had money to blow and wanted higher end living, I still wouldn't pay 30,000p a month for a house in Davao. That's insane. The market rate there is nowhere near that for a house, even a good one.

I can't believe the expats there would do that. Don't they have any shame when they ripoff people?

Plus any expat with average intelligence can see that that's overpriced.

In the Angeles City Bluebook, I saw an ad for a room in a shack in the backyard of someone's home, renting out for 300 dollars a month. When I texted the guy and asked him "Why would anyone want to pay US prices in the Philippines? That's not logical." he didn't reply.

I guess some guys are souless.

I've met a lot of guys who inflate every single number in their life, both in their assets and expenses, as if being a big spender was something to be proud of. Every little thing they bought, they claim, seems to cost a ton of money. Why are so many guys like that? It's so shallow and unspiritual and unintellectual. Sick.

I had a friend who would double or trip anything that I said. For example, when I said "My braces cost $2000" he would say "Oh that's nothing. Mine cost $10,000". Why do guys do that? That's so stupid!
Last edited by Winston on November 1st, 2010, 6:03 pm, edited 1 time in total.
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Post by Rock » November 1st, 2010, 5:27 pm

Winston wrote:Even if I had money to blow and wanted higher end living, I still wouldn't pay 30,000p a month for a house in Davao. That's insane. The market rate there is nowhere near that for a house, even a good one.

I can't believe the expats there would do that. Don't they have any shame when they ripoff people?

Plus any expat with average intelligence can see that that's overpriced.

In the Angeles City Bluebook, I saw an ad for a room in a shack in the backyard of someone's home, renting out for 300 dollars a month. When I texted the guy and asked him "Why would anyone want to pay US prices in the Philippines? That's not logical." he didn't reply.

I guess some guys are souless.

I've met a lot of guys who inflate every single number in their life, both in their assets and expenses, as if being a big spender was something to be proud of. Why are so many guys like that? It's so shallow and unspiritual and unintellectual. Sick.

I had a friend who would double or trip anything that I said. For example, when I said "My braces cost $2000" he would say "Oh that's nothing. Mine cost $10,000". Why do guys do that? That's so stupid!
Since morals are being discussed, I have a question for you. If someone offered you US$500K for your website, would you:

1. Tell them its not for sale, even at that price
2. Accept
3. Let them buy it from you but insist they only pay only a reasonable amount

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Post by Winston » November 1st, 2010, 5:58 pm

Rock wrote: Since morals are being discussed, I have a question for you. If someone offered you US$500K for your website, would you:

1. Tell them its not for sale, even at that price
2. Accept
3. Let them buy it from you but insist they only pay only a reasonable amount
I'd probably accept it. But they are making the offer. I am not asking for 500k USD.

If you look at my site though, everything is priced pretty low, not over like others do. I live what I say. I don't like to pay a lot, so I don't charge a lot either. That is consistency.

But when you ask for 30,000p to rent a house, you are in a way claiming that that price is the market value or near it, which is false cause one can get a house for a fraction of that. To me that is deceptive, in my book.

The danger is that someone stupid might overpay. In a way, that's an injustice.
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Post by Winston » November 1st, 2010, 6:00 pm

What about my question below?

"I've met a lot of guys who inflate every single number in their life, both in their assets and expenses, as if being a big spender was something to be proud of. Every little thing they bought, they claim, seems to cost a ton of money. Why are so many guys like that? It's so shallow and unspiritual and unintellectual. Sick.

I had a friend who would double or trip anything that I said. For example, when I said "My braces cost $2000" he would say "Oh that's nothing. Mine cost $10,000". Why do guys do that? That's so stupid!"
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Post by Rock » November 1st, 2010, 6:11 pm

Winston wrote:
Rock wrote: Since morals are being discussed, I have a question for you. If someone offered you US$500K for your website, would you:

1. Tell them its not for sale, even at that price
2. Accept
3. Let them buy it from you but insist they only pay only a reasonable amount
I'd probably accept it. But they are making the offer. I am not asking for 500k USD.

If you look at my site though, everything is priced pretty low, not over like others do. I live what I say. I don't like to pay a lot, so I don't charge a lot either. That is consistency.

But when you ask for 30,000p to rent a house, you are in a way claiming that that price is the market value or near it, which is false cause one can get a house for a fraction of that. To me that is deceptive, in my book.

The danger is that someone stupid might overpay. In a way, that's an injustice.
I any believe that they are entitled to sell at whatever the market will bear. That means, if they can price something very high and still find a buyer, then they have done nothing wrong. Its really the buyers job to do his own research and due diligence. I don't think listing a property at any price is a misrepresentation unless its accompanied with untruthful descriptions or information. If you listed your site on Flippa for US$500K with correct revenue data and related info and someone actually bought it from you, I don't see how you would have done anything wrong.

Anyway, if there are really so many gullible expats in Phils, why don't you consider buying or renting at local rates and selling or subletting at the inflated rates these expats are willing to pay? Somehow, I don't think its as easy as it seems. There are probably some factors involved that you are not aware of.

Real estate is a tricky biz. If something is attractive to richer foreign buyers, its likely to rapidly appreciate in market value. Just look what often happens to house prices in communities popular with overseas Chinese.

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