Best Posts in Thread: Is Philippines really that cheap?

I'm no expert, but in my limited experience there are a couple things in play. The average Filipino lives on a lot less than you do, so if you want to see all the savings trying living like they do. Most expats are not looking to do that. There are several threads on this forum about how much it costs to retire in the Philippines you may want to look at. In my experience, most manufactured products, cereal, cars, tools are more expensive, with the exception of some cheap Chinese knockoffs and medicines. The only thing that is significantly cheaper is human labor. I can get a guard or a driver for significantly less there than in the US. Most people probably compare where they are coming from to where they are going, so it's not a I'm in the cheapest place, but my annual spend is less than where I came from. Perspective makes a huge difference. The are also other criteria as you mention above.

 

A new rookie in town

So, I have arrived in Dumaguete and started to explore and digging into expenses etc. Just to be clear, I did not come here to save, but hey! who wants to pay more then u should right?

I travel..A LOT... always did, so I am pretty familiar with expenses and 'turist traps'.
I am not your typical haggler, I rather just say no thx.

Back to Dumaguete and Philippines.... I have been told so many times that Philippines is so darn cheap! Ok..compared to what?
Norway? YES!
Singapore? YES!
Thailand? NO !
Indonesia? NO!
Portugal then? NO!
Italy it must be! NO!

If you compare what you really get in small towns in certain European countries, I would say Philippines is not cheap.

Many come for the weather, yes.. it's warm and I love it too.

Some come to drink cheaper, well, in some countries in Europe you pay even less for the alcohol (for those that thinks it is important)

Rentals and property prices then? No, I know from experience that it's same or more expensive even (again quality and standard)

Don't believe me?


So why are you here then you might ask?
Well, I am here for the feeling I get being with the people here. Sure Bulgaria is dead cheap, but I don't like the macho mentality. I do love their tomatoes tho Portugal has good cheap rentals, wine, food, beaches and more..but people are not that open as here, and they got a colder winter .brrrrr.

But this post was about prices and they are not surprisingly low...as some say

If you read this forum considering coming here to save money only, there are many other options. If you cherish many of the same things as me in how the population is and behaves, Philippines can be a good place for you too.

Thanks for sharing and helping me and others in this forum, highly appreciated

ThatNewGuy

 

Well, it's quite expected that themes will repeat themselves here. New people sign up and long-termers move on for various reasons. The problems and solutions of living here don't change that much over time. Newbies simply are not interested in starting with "thread one" and reading the entire archive for the Dumagueteinfo.com forum just to be sure not to repeat oneself.

I think many (most?) of us try a search before posing a question, but that often leads to much time wasted reading essentially irrelevant posts. It's easier to just ask. If one gets offended, sign off.

 

Obviously you are not talking about affordability, as that depends on the cash you have available.

You are saying that with the same amount of cash from your source (which may or may not be your home country) you can live cheaper in some other countries - and you name some.

The problem is which part of each country are you comparing and which living costs. Comparing prices from any country with Manila will, of course, give different results than if comparing with Dumaguete, which is where you seem specifically to be comparing with. And what are people's living costs? That is the big unknown. Family 'A' rent a 4 bed detached house, like eating out, drinking quality wines (out and at home) and running a car - whereas Family 'B' live in a 2-bed townhouse, prefer eating in, do not consume alcohol (ok, I know they sound boring already to many!) and use trikes/jeepneys/buses. These are just two 'consumer types' and there are very many other possible types.

The comparison is: How much does the exact equivalent (with all the difficulties that entails in matching) style-of-living cost in the original currency (the one you convert from)?

Perhaps type 'A' will find their cost of living (for a comparable lifestyle) more expensive than if they were living in certain other countries you name but type 'B' might find it cheaper. And when currency exchange rates change, both might find a different story.

For me, I know I am paying FAR less on my major expense - house rental - and that the savings compensate for virtually every other higher cost (possible exception of medical as it is unknown when and how much). So I have to focus on 1) Is it cheaper than my home country? (Answering 'yes' is an advantage and enables me to be a bit smug should I need to be); 2. Can I afford to live here? (More important than '1'); 3. Am I happy here? (Combined with '2' to give me the only factors I need to know).

Then I can sit back and worry zilch about Thailand, Portugal, Italy or Indonesia.

 

I do not think it is like that. I think the exchange rate itself just a norming exercise. You consider 50p = 1 USD. Over time, the 1 USD will buy more or less pesos but rarely by more than +/- 15%. When the exchange rate goes much beyond 55, peso prices inflate to make up the difference and often do not deflate when it goes down to 45. My point is, things are not cheaper due to the peso dollar exchange rate. In fact, things like foreign made appliances, construction materials and gasoline and many other things cost more. Labor and “local food” agricultural products cost less and, all in all, I have read that it is perhaps 35-40% cheaper to live here than in the US but even that is variable; I think it would be about the same cost to live here as in Tupelo Mississippi or many other small towns in the country. Once you normalize pesos and dollars to 50:1, yes it is generally cheaper for most but not due to the exchange rate itself. Peso costs have and will always inflate to keep up with available dollars in the economy. I don’t consider PI to be the place to go for an extremely cheap retirement if you want to live to western standards as in a large city in the US; however, the PI can give you a reasonably good life when you can only afford to live by local standards. In Panama and Ecuador, they use the US dollar as their currency, a 1:1 exchange. Normalized prices are very similar in those places to the Philippines. In the US, people trying to make a life on a low retirement income in the urban areas may find themselves homeless.


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Economist try to make this more objective by using a Purchasing Power Parity index. They take a basket of item, housing, food item, gas, etc., and compare them in different regions, accounting for currency differences as well. It is an attempt to compare apples to apples. The ones I know use the average US prices as the base. If a place is more expensive than the US the number will be lower, if it is less expensive, the number is higher, a number of 2, for example, means that the same items can be purchased for 1/2 the cost as in the US. Bulgaria has a PPP of 2.23, Portugal 1.20, Vietnam 3.36, Cambodia 3.21, Thailand 2.65 and the Philippines 2.62.

Of course, if a place is more prosperous they tend to have things like better infrastructure and more efficient systems and similar things that improve the quality of life that aren't captured in that number. The GDP of the countries, using PPP, in the order above is 19,321, 26,688, 6609, 3870, 16,905, 7942. If I ranked them on a cost of living/quality of life scale then I would put them in this order, Thailand, Bulgaria, Philippines, Vietnam, Cambodia, Portugal.

Actual quality of life and preferences are subjective and individual and there are wide variances in different locales within each country and there are a lot of other factors involved as well, for me, access to mountains and outdoors, climate, percentage of English speakers, ease of getting a visa and legally staying, and the fact that my wife is Filipina means that Philippines is the choice. Second choice is Vietnam.

 

Rent is the biggest cost factor for me vs. back home; here = approx 215USD vs. same size space back home = 2200USD. And as others have mentioned; labor. Someone mentioned petrol comparison, while it is a bit higher here, the consumption is much less. The weather allows for bike travel 12 months/yr on 1 cylinder transport and many choices of 3 cylinder cars, etc.

 

Exactly - if you want to eat healthy in the Philippines that means sourcing and preparing most of your food yourself. Doing that for breakfast / lunch and eating out for dinner only works pretty well for me. Couple good places for steaks or seafood, and the occasional burger or pizza as well here in Dumaguete.