Philippine Investment

Saturday, September 02, 2006

Condotel Ivestments in the Philippines are Better For Investors than Condotels in the United States.

Condotel Investments: Not Always a Smart Idea in the United States !

Even with record room rates, owning your piece of the condo-hotel
business in the United States might not be so profitable, experts are
saying. Yet thousands of investors have yet to figure that out.
Economic indications show a trending towards recession in the United
States real estate industry with lower demand, higher interest rates
and falling property prices. Take Out from the equation recent yearly
average appreciation of real estate in the short-mid term. Any US
investment at this time is now viewed as long term.

American Real Estate Investors are buying Studio Suites in Florida
ranging in price from $500,000 each at a South Beach condo hotel. In
other areas prices are even significantly higher. But will that be
enough to cover the investment?

Only time will tell whether it was wise to purchase a Condotel Suite
in the United States for this kind of entry level price, with
optimism about profits from condotel operations -- where buyers rent
their units for a share of the rental revenue. Analysing the current
market prices and trend in interest and occupancy rates, we think
there's going to be a lot of disappointed buyers of Condotels in the
United States.

Condo-hotel buyers in the United States shouldn't think revenue from
the units they buy will cover a Florida mortgage, particularly with
current prices. A new study goes further and predicts most South
Florida real estate projects of this nature won't even cover
maintenance fees, property taxes or other costs.

In a recent report, issued by the National Association of Condo Hotel
Owners (NACHO), it projects returns for typical condo-hotel units in
Fort Lauderdale, Miami, Miami Beach and Coral Gables. Assuming owners
keep 35-40 percent of the rent (the standard share) they would pay
between $500-15,000 a year to cover expenses. That assumes they paid
cash for their units, too. There's the small matter of Florida home
mortgage payments and interest fees, which would be extra. On top of
insurance, Florida mortgage payments and property taxes, and a flood
of new luxury hotels, will keep rates too low to make the units
profitable. In fact, the study cites the small hotel market of Coral
Gables as the lone location where condo-hotel buyers could expect
returns (of a modest 1-2 percent) on their units.

Condotel Investments: A Smart Idea in the Philippines !

Owning your piece of the condo-hotel business in the Philippines will
be more profitable than the same investment dollar for dollar in the
United States. It's amazing that thousands of US property investors
have yet to figure that out.

Offshore Property Investors are buying Studio Suites in Metro Manila
and Cebu, Philippines ranging in price from $36,000 each. At these
entry levels, this will be more than enough to cover the investment.
Only time will tell whether it was wise to purchase a Condotel Suite
for this kind of entry level price, however simple mathmatics and
common sense dictates in the positive with increased optimism about
profits from condotel operations -- where buyers rent their units for
a share of the rental revenue. Hotels in Metro Manila operate on an
average high 80's% occupancy rate with Cebu even higher pushing into
the 90's% occupancy.

Analysing the current Philippine market prices and trend in the
Countries interest and occupancy rates, we think there's going to be
a lot of very happy investors and buyers of Condotels in the
Philippines.

Condo-hotel buyers in the Philippines dont even have to worry about
interest rates because developers offer short term payment plans over
2-5 years at zero interest so buyers can immeadiately think revenue
from the units they buy because they dont have to worry about
computing income to cover the interest portion on a developers
interest free payment plan. The savings on interest payments are more
than enough to cover maintenance fees, property taxes or other costs.

Returns for typical condo-hotel units in Metro Manila & Cebu,
Philippines are much higher because owners keep 60 percent of the
rent. With current market prices for Hotel Accomodation, assuming
they paid cash for their units, rental ROI's could go as high 16%-18%
per Annum and better yet, as most hotel clients pay their bills using
major US Credit Cards, the overseas investors are going to receive
their rentals in US Dollars avoiding any concerns over fluctuating
exchange rates !

Moreover, because the entry level is 90% less per Studio Suite in the
Philippines, the risk factor is greatly deminished. Moreover, real
estate appreciation is running 25% per annum on pre-construction
purchases and around 15% per annum on completed units..... combine
this with possible Tax benefits for US Offshore Investors and the
Philippines has to be a "Win-Win" opportunity.

...

For the price of garage in the US nothing to loose and everything to
GAIN ??

Guessing on Revenue from Condotels in the United States

Would-be buyers of condo-hotel projects in the United States are
largely left to guess at the revenue their units will generate
because Federal security law bars real estate developers from passing
on the projected hotel guest rate to condo-hotel buyers. Real estate
agents in the US can lose their licenses if they talk to you about
how much income you're going to generate, as a matter of fact. With
US hotels unable to provide their rate projections, staffers often
urge buyers to do their own research on nearby hotels. But that's not
exactly easy, as virtually no hotels release year-end financial data,
and rates quoted at the front desk fluctuate day to day.

Solid Information and Revenue Data from Condotels in the Philippines

Buyers of condo-hotel projects in the Philippines are not left to
guess at the revenue their units will generate because there are NO
Federal security law that bars real estate developers from passing on
the projected hotel guest rate to condo-hotel buyers. Real estate
agents in the Philippines can't lose their licenses if they talk to
you about how much income you're going to generate, as a matter of
fact. Philippine hotels are readily able to provide their rate
projections. This enables the Condotel unit investor all the
information he needs to calculate the rental returns and ROI on his
investments making the purchase practically risk free....

Condotel Investments in the Philippines.

A Condominium Hotel or "Condotel" combines the convenience of a
residential condo with the amenities of a hotel. It is not an
ordinary Condo Building. It is specifically designed architecturaly,
as a Hotel first and foremost with Hotel Style Suites which are
normally larger than regular residential units. A Condotel normally
has more amenities, facilities and services not found in condominiums.

Condotels are completely different from Residential Condominiums
where unit owners can act as a landlord and rent their units
privately or have someone rent their units for them.

Rental Income from a Condotel Unit is normally 30-40% higher that a
regular rental because the Hotel concept offers the option of daily,
weekly, monthly leases which ordinary private condo unit owners would
not normally entertain.

Unit owners in a "Condotel" may opt to join the rental pool where he
signs with a professional hotel management team who will convert the
project into a world class hotel / serviced apartment. A serviced
apartment is run just like a hotel but guests usually stay on a long
term basis. For the tenant, this means savings since he is not
charged a daily rate nor does he have to put up a security deposit
like in a regular apartment.

Aside from real estate appreciation, unit owners receive a steady
monthly income based on the size of their unit regardless of whether
said unit was leased or not. This is because the hotel management
will pool together the total income of the entire hotel and
distribute this to unit owners net of any expense. This makes the
investment cost efficient and practically risk free.

Unit owners in the rental pool enjoy totally hassle-free CONDOTEL
management. They need not worry about unpaid electricity bills,
unpaid rent, and other problems so common in conventional leasing.
All concerns, down to the payment of electricity bills and utilities
are taken cared of by the professional hotel management operator.

Condotel Suites can be purchased as vacation homes to buyers whom
would probably only occupy the units no more than one month per year.
In normal circumstances the unit owner pays the maintenance and
upkeep of the unit for the entire year without deriving any benefit.
However in a Condominium Hotel, during the time they do not occupy
their units, they have the option to rent out their Condo through the
hotel management and receive rental income on their property making
the ownership of a unit an income generating property and self-
liquidating investment with hassle-free property management as the
hotel can rent out their unit, with all the services provided, by
day, week or month. Because of the additional superior features and
services provided by the hotel, Condotel Suites are normally valued
15 to 20 % higher than same size residential units without added
hotel features and amenities...

There are in all Condominiums the "Monthly Condominium Dues" payable
to cover such recurring expenses as the maintenance of the common
areas, security guards etc….. however, in a Condotel, building
maintenance and operations is subsidized by the additional revenues a
condotel provides the building management

Guide when Buying real Estate in the Philippines

Check-List Before Buying Real Estate in the Philippines

Here are the tips a buyer must remember before buying any property in the Philippines, specially if you are buying a single property from an individual:

1. Make sure the "Transfer Certificate of Title" is authentic. The easiest way to check if the title to the property you are buying is authentic is by getting "Certified True Copy" of the title from the Register of Deeds. This office is usually located at the city or municipal hall where the property is located. Ask the seller of the property for a photocopy of the title -you will need the title number and the name of the owner to get a certified true copy of the title from the Register of Deeds.

2. Verify that title is clean - meaning the property is not mortgaged (no liens & encumbrances on the property). You can see that at the back of the title with the heading "Encumbrances". This page must be empty if you are told that the title is "clean". But sometimes the space for the technical description of the property on the front page of the title is not enough and the description of the property is continued on the "Encumbrances" page, this is of course all right.

3. Make sure that the land described on the title is really the land that you are buying. You can validate this at the Register of Deeds or by hiring a private land surveyor or a geodetic engineer. Land titles don't have any street name and number to pin point a property, it is a must to confirm that the actual property you are buying matches the technical description on the Transfer Certificate of Title.

4. Make sure that the sellers are the real owners. If you are buying from an individual property owner, ask for identification papers like passport or driver's license, it is also a good idea to talk to the neighbors to confirm the identity of the sellers (you might as well ask some history of the property).

5. Confirm that the yearly real estate taxes are paid. Ask for a copy of the Tax Declaration and Tax Receipts to confirm that real estate tax payments are up to date.

If the above check list is in order, it is safe to proceed with the purchase.

Taxes, Commission & Registration

This is the normal sharing of expenses between the buyer and the seller when transferring the real estate property title (TCT or Transfer Certificate of Title) to a new owner:

The Seller shoulders the:

* Capital Gains Tax (6% of the contract price)

* And all other unpaid taxes due.

* Pays the Agent / Broker's commission (usually 3 to 5% of the selling price).

The Buyer Pays for the:

* Documentary Stamp Tax - 1.5% of the contract price, or zonal value or fair market value, which ever is higher.

* Transfer Tax - 0.5% of the contract price, or zonal value or fair market value, which ever is higher.

* Registration Fee - 0.25% of the contract price, or zonal value or fair market value, which ever is higher.

The above sharing of expenses is the standard practice in the Philippines. However, buyers and sellers can mutually agree on other terms as long as it is done during the negotiation period (before the signing of the "Deed of Sale").

The "Deed of Sale" is the document showing legal transfer of real estate property ownership. The deed of sale is then taken to the Registry of Deeds to be officially recorded. Always purchase property with a proper Title & a deed of sale if possible, and if there is not one, a tax declaration is your last choice.

Your Agent / Broker will usually do the registration process without any additional payments (aside from the commission).

Documents needed for the Transfer of Certificate of Title (TCT):

* Copies of the Deed of Absolute Sale

* Latest tax declaration of the property

* Certificate from the Bureau of Internal Revenue that the capital gains tax and documentary stamps have been paid

* Transfer tax

* Receipt of payment of the transfer and registration fees

An adapted form of the "Torrens" system of land registration is used in the Philippines. The system was adapted to assure a buyer that if he buys a land covered by an Original Certificate of Title (OCT) or the Transfer Certificate of Title (TCT) issued by the Registry of Deeds, the same will be absolute, indefeasible and imprescriptible.

7 Tips for Worry-Free Real Estate Transactions

Real Estate transactions in the Philippines are sometimes a cause for worry due to the many inherent problems in the system. What follows are some tips and rules to follow for a worry-free (or "less problematic") Real Estate transaction:

Tip #1. Deal only with Titled property.

There are many properties in the Philippines that are not titled, or registered under the Torrens system. If you buy an untitled property (usually evidenced by only a Tax Declaration), you would not enjoy the benefits of the Torrens system, and you will be forced to investigate for yourself the "chain of ownership" from the present owner up to the first, which usually dates back to the 1920's. With titled property, you can rely on the fact that the owner of the property is that which is stated in the title.

Tip #2. Stick to those properties registered in the names of actual sellers themselves.

Most properties in the Philippines are titled in the names of the grand parents or even great grandparents of the owners. thus, there is still the need to execute an extra-judicial settlement, which has a "grace period" of two years within which an excluded heir can question the settlement and the sale. This type of litigation is fairly common and is the usual source of problems. Thus, avoid properties not titled in the names of the actual seller.

Tip #3. Avoid SPAs (Special Power of Attorney) - deal with the actual sellers themselves.

Another of the common sources of property litigation in the Philippines are those involving special power of attorneys. This is an instrument that empowers a party to deal with the property of another, usually for the purpose of selling the property. Oftentimes, unscruplous individuals procure a special power of attorney surreptitiously from the unwitting owner who is led to believe that the document being signed is something else. Believe it or not, most of the property owners in the philippines have finished only primary schooling and cannot read english documents. If you must deal with property being sold through an SPA, verify the SPA by questioning the notary public who executed the same, and even meeting the property owner himself.

Tip #4. Always check the copy of the title on file with the register of deeds.

In the copy on file with the register of deeds are annotated the "involuntary liens" (i.e. claims of third parties and the government, road right of way, etc.). Although the title may still be registered in the name of a person, ownership might have been transferred, questioned, or otherwise affected, and this can be seen at the back of the title on file with the register of deeds. Secure a certified true copy of the title from the register of deeds. Do this yourself or through a trusted party, never from the seller or his middleman.

Tip #5. Always have the property identified by a licensed surveyor to be what is being stated in the title.

Once you have decided to buy the property, ask the seller to allow you to conduct a relocation survey. although you might be required to shell out additional expense for the survey, then you can actually be assured of the metes and bounds of the property and that the property you are buying is actually that stated on the title. Furthermore, by asking for a relocation survey, the adjacent owners are summoned, and thus if there be any unforseen questions some of them would be voiced out during the relocation survey.

Tip #6. Always see to it that you have a road right of way

Just merely looking at the property and seeing a road is not enough. Check the title and see whether or not it is actually bounded by a road lot, road, or street. The surveyor can point this out to you. Most foreigners like the countryside and coasts, where agricultural lands are located. Thus, most agricultural lands when subdivided into smaller parts do not provide for a road in the subdivision plan. Be sure therefore that you have access to the land otherwise, you might be required to purchase a right of way, oftentimes at exhorbitant prices such that you are forced to enter into litigation to have the court fix a reasonable price.

Tip #7. Never forget to have your deed of sale, contract of sale or other document over the land annotated on the copy on file with the register of deeds.

This should be clear enough to be sure that your records are correctly stored and your property properly transferred to you in official government documents.

We hope this small article would be of help to you and your real estate transactions. Nothing is still better than having the services of a trusted Real Estate broker or realtor helping you along the way.


This article has been generously contributed with the express permission of Mr. Martin "Jerry" Cornelio. It has been slightly modified by InvestPH for better online reading. Our many thanks for sharing your expertise on this subject.

Sunday, August 27, 2006

Improve your chances of owning a dream house

By Tina Arceo-Dumlao
Inquirer News Service

WITH INTEREST rates on home loans down to very attractive levels, it is no wonder then that many Filipinos are enticed to make a beeline for the nearest bank branch and sign up for a housing loan.

After all, almost every Filipino dreams of having his own home.

But then it pays to take a few moments to determine if you are financially ready to take on a home loan. No matter how attractive the interest rates, the fact is that the housing loan would put a strain on monthly finances.

It also does not mean that the current low rates offered by the banks would not go up sometime in the future.

Metropolitan Bank and Trust Co., one of the country's biggest banks, offers a few pointers to help improve chances of owning that home.

When you have finally decided that you want to buy or build a house, the following should guide you in your planning:

Develop a monthly budget, which will include household expenses, bills and other regular payables.


Based on the monthly budget, make an annual budget, adding 15 percent on each item or to the total expenditure to allow for inflation.

Compare the money you earn versus the money you spend so you can see how much extra money you have for the monthly amortization of the housing loan. Spare bonuses or commissions from computations. You can add them instead to your savings.

See if you can pay off minor debts before you apply for a housing loan. The less debt you have, the easier it is for you to manage your finances and the better the chances of getting a home financing loan.

It would be helpful to know your present cash position to help you decide on how you can finance your acquisition or construction. And if your finances would require you to get a loan, you may also want to start planning how you will finance the amount of equity you will have to shell out.

Consult with the members of the household. Buying or constructing a house should be a family decision because it may mean cutting down on other expenses like entertainment to make way for the housing loan.

If you are buying a house, Metrobank offers these suggestions:
  • In selecting a house to buy, one should consider budget, location and lifestyle. Since it would be impossible to meet all requirements, aim to meet at least two considerations most important to you like budget and location.

  • Buy only from a reputable real estate developer. If it is not a brand-new house, deal only with authorized or licensed real estate brokers, or better yet, the owner himself.

  • Make sure the property is not overpriced by consulting the City Assessors' Office at the city hall. You can also check out the classified ads to get some idea of the price range.

  • Verify with the Registry of Deeds if the original title is free from liens and encumbrances. Some properties have titles which are unacceptable for mortgage and may pose some problems in the future.

If you are constructing a house:
  • Research in magazines and books.

  • Work with experts your friends recommend based on their own experience.

  • Finalize the design based on your budget.

  • Be in charge. Ask questions, make suggestions and be involved. It is your house.

  • Try to stick to your first choices. Once work is underway, changes should be kept to a minimum. Revisions entail additional cost and delays in the completion of the project.

  • Keep in close contact with your contractor.

  • Flexibility should be considered. Whether buying a house or constructing one, there should always be provisions for future expansion.

Once you decide to get a loan to help bankroll either the house construction or the purchase of a new house, it's time to scout the banks to determine which one offers the best deal.

Most major banks like Metrobank require a gross monthly family income of at least P40,000 to qualify for a housing loan.

Take the effort to compare the offers of the different banks because a housing loan is a long-term arrangement and it represents one of the biggest loans that a person would get in a lifetime.

Why heavy rain can be a buyer's best friend


By Alexis A. Acacio, contributor
Inquirer News Service

THE RAINY season is what real estate marketers consider a lean season in which they feel a slowdown in property purchases. This is because most home buyers do not have the feeling and energy to shop for a home when there is continuous rain. Maybe another reason is that the high tuition fees have just eaten up the family savings in June so the downpayment for the home has to be realigned.

From a real estate marketer's perspective, the rainy season may be a lean month but for real estate buyers, this can be a good opportunity to look for property. And it does not matter whether one is looking for a vacant lot, beach home, commercial property or a residential home.

Typical home problems

Buying a home during the rainy season can offer the home buyer a situation that cannot be experienced during the dry season -- that is, continuous rain that may bring out the defects of a poorly built house. The typical home problems that come out during the rainy season that cannot be detected during summer are access, floods, roof leaks, grounded electricity, porous walls, warping cabinets and flooded streets, among others.
  • Access roads. In continuous heavy rain, you will be able to discover the passable routes and the impassable ones. By this, you can decide on which location you would want to live on. Access roads are as important as the site itself. If for example you are buying a house in the mountain that is several hundred feet above sea level but the access roads leading to it are always flooded with a slight rain, then the property may not be desirable at all.

  • Flooded areas. You can observe whether the area you are looking at is flooded or not. The best way to check is by going there yourself during a heavy rain. You may even ask the residents themselves if the area floods when it rains. If you can see sandbags and unusually elevated homes in the area, then it may be a sign that the subdivision easily gets flooded.

  • Grounded electrical lines. A poorly maintained (and dangerous) electrical system sometimes shows its symptoms during the rainy season. Ask a professional to check out these defects for you.

  • Leaking roofs and ceilings. A wet ceiling is mainly due to a leaking roof. In case you are visiting a home when it is not raining, be specifically cautious about watermarks in the ceiling. These are signs of a defective roof system.

  • Porous walls. Firewalls and walls that are continuously exposed to rainfall manifest leaks and moisture if they are not properly made and maintained. You can only observe these defects when it is raining.

  • Overflowing rivers. If you are buying a property that is adjacent or near a river, then you must check if the river overflows when there is a heavy rainfall. You may ask the neighbors on the situation but better yet, go there yourself during a heavy rain.

  • Warped cabinets. If the wall behind the cabinet has a water leak, then the wooden cabinet would naturally warp. Warped cabinets are the product of excessive moisture that usually comes from leaking ceilings and roofs.

Visiting a property you are considering during a heavy rain can give you very important information that you will never get during the dry months. Yes, it may be difficult to push yourself to visit your dream home when it is raining (as most of us would rather stay home) but for sure, it has its rewards. So if you are still looking for your dream home, get up and look for it this season.

So the next time it rains very hard, remember that it may just be the best time to look for a home.

'OFW phenomenon' to continue in 2006
By Tessa R. Salazar
Inquirer News Service

WILL OVERSEAS Filipino workers' investments in their home country continue to rise or slacken this year? Optimistic developers and real estate firms believe more money from OFWs will be pouring in.

Eric Soriano, ERA Philippines country president and CEO, said home mortgage investments develop "discipline" in the form of forced savings on OFW dependents.

"Our studies have shown that there is a 92 percent repayment of monthly amortizations among OFW homebuyers, a positive indicator for the industry," Soriano said.

"I believe the iceberg for OFW markets is very deep," he added.

Top priorities

According to him, statistics have shown that education and real estate are still top priorities for any OFW provider. Reinforcing OFW remittances are new money coming from balikbayans from North America and Europe.

Marivic Añonuevo, vice president and head of Ayala Land Inc.'s leisure and lifestyle communities, said the number of Filipinos leaving the Philippines to work abroad continues to grow at around 12.5 percent.

"Although this is really a sad phenomenon, this indicates however that the amount of dollars earned and remitted back home continues to grow. Rather than slacking off, therefore, we in ALI feel that we have only mined what we believe is the tip of the large OFW market."

Danilo E. Ignacio, general manager of Robinsons Land Corp.-high rise building division, said RLC is confident that the OFW investments in real estate will remain.

Owning their home

Jose EB Antonio, chairperson of Century Properties Group and Meridien Development Group, said that 30 percent of the income of OFWs in general is spent on housing, whether to buy a new home, fix present homes or pay for rent.

"The quest for the Filipino dream of owning their home is foremost in the minds of OFWs. It is also worthwhile to note that the average income of an OFW has increased, as more white collar workers and technical people are working abroad," Antonio said.

Soriano observed that historically, spikes in OFW remittances occur every middle and end of the year.

"However, with the continuous deployment of new OFWs in existing and new geographical markets and the increase in remittance month on month, we can expect a steady stream of real estate business from the sector all throughout the year," he said.

Añonuevo estimated that ALI overseas sales accounted for nearly 20 to 25 percent of the total sales volume generated by the ALI parent company, including subsidiaries such as Community Innovations Inc and LPHI. She added that recognizing this large potential, ALI has established Ayala Land International Sales Inc.

Ignacio said that RLC markets selected projects internationally. "Revenues generated from our international marketing efforts account for a substantial portion of our sales. We thus intend to pursue building this segment," he said.

Advice to developers

ERA Real Estate, a multinational real estate service provider that manages Eastwood, expects to grow its OFW portfolio from 15 percent in 2005 to 25 percent this year.

"The industry posted an average OFW contribution of 20 to 25 percent. My advice to developers is for them to focus on increasing their OFW portfolio by an additional 15 percent this year," Soriano said.

Do you really save by selling on your own?
By Alexis A. Acacio, contributor
Inquirer News Service

EACH one of would want to save money. If we can do something on our own, then why do we have to pay for services that we may never need? This thinking follows through when it comes to the real estate transaction. When one sells real property, there are always two paths to do it -- (1) sell on our own; and, (2) sell it with the help of a professional that is through a real estate broker or salesman.

Selling on one's own can offer advantages:
  • You can save on commissions. Selling on your own can save you the commission that you may have to pay the real estate professional who will sell your property. This is why most house owners would want to sell on their own.

Certain situations also warrant that you can sell on your own:
  • It is your profession. You may be in the sales and marketing profession only that it is not real estate that you are currently selling. You may want to try your skill in selling real estate. Remember though that if you are used to selling medium-priced items in the range of a few hundred pesos, selling a five-million-peso property with a lot of legal paperwork is entirely a different ball game. If you are in the legal profession, then going through the process of documentation and paying the necessary taxes can be easy for you.

  • Your relatives or friends might buy the property. If you have a ready buyer who has been constantly telling you that should you decide to sell your property, they will buy it in a snap, then go ahead -- sell without an agent. In this situation, you already have a sure buyer.

If you think that you can sell your property on your own, ask yourself if you can handle these things:
  • Do you know where your buyers are? Selling real estate requires that you reach able, ready and willing buyers. Knowing where to find them is half the battle.

Real estate professionals work together as a team and have a network to share and to exchange listed properties. It is then made known within the network that a certain property is for sale at a certain location at a certain price. If you do sell on your own, you cannot possibly use this network without having an agreement with a broker.
  • Do you have the time? Selling your home will involve meeting the prospective buyer, showing them the house, answering questions and discussing financing possibilities. This can take a few hours and can easily take up the whole day especially if the property is located outside the metropolis. Showing the property means that you may have to take off from work and cancel some of your important appointments.

  • Do you know the market value of your property? If you price too high, many prospective buyers would not even consider making an offer and worse, your property may not sell at all. If you price too low, then of course the property will sell in a flash but you will have lost money.

Having a real estate professional on board will give you a proper appraisal of the property so that you neither would price it too high nor too low.
  • Do you know how to negotiate? Selling real estate involves a series of offers and counter offers until the buyers and sellers agree on the price and terms. This process can cause a lot of stress on those who are not used to negotiating.

Your real estate professional can negotiate in your behalf.
  • Do you know the legal aspects? Selling real estate involves legal documentation and transfer of title. The process involves going to the various government agencies, filling up the necessary forms, paying the required taxes and picking up documents that you would need for the next process. This requires knowledge and experience and involves a lot of your valuable time.

Real estate professionals are very familiar with the process and can perform the tasks for you in a breeze.
  • Do you know the process? Not knowing the process of selling real property especially the legal aspects can be a waste of your valuable time or much worse, can cause you legal problems. If you sell on your own, you would still need the advice of a real estate professional or a legal counsel that means that you will also spend money on professional fees.

Real estate research has shown that four out of five pieces of real estate property are sold through a real estate professional. If you think you can save money by selling on your own, just make sure that you are ready to face the risks of doing it on your own.

Other Stories

Big push to woo Koreans to live in RP
By Jerry E. Esplanada
Inquirer
Last updated 09:17pm (Mla time) 08/20/2006

Published on page B1 of the August 21, 2006 issue of the Philippine Daily Inquirer

DAEJEON, SOUTH KOREA--A perceived peace and order problem. Apprehensions over the political situation. Delay in the modernization of public infrastructures.

Notwithstanding those weaknesses, the government's foreign retirees program still managed to bring in more than $123 million in additional revenue from 2001 to 2005.

But the Philippine Retirement Authority (PRA) thinks it's not good enough.

The agency is set to launch shortly a worldwide campaign, which PRA chair Edgar Aglipay calls "Come (to the Philippines) and be our family."

"It will be an intensive PR and marketing campaign like Malaysia's 'Truly Asia' and Thailand's 'Amazing Thailand' tourism drives. And we firmly believe it would be good to start with the Koreans," Aglipay said.

The plan is to promote the Philippines as the Koreans' "second home."

South Korea is a "potential gold mine" as far as the Philippine retirement industry is concerned, according to the former chief of the Philippine National Police.

In 2001, South Korea had a population of 47.9 million, 34.07 million of whom were classified as either active or retiring while 3.48 million were either retired or elderly. Minors totaled 10.3 million.

Aglipay told the Inquirer that the South Koreans "obviously like Filipinos and what we have, and there is mutual respect and love for each other. Add to that the fact that there are now more Koreans in the Philippines than Filipinos in South Korea."

Aglipay's claims are affirmed by, among others, the print media here like the Korea Times, which reported recently that "more Koreans look to retire in the Philippines"

Said the daily: "For the past three decades, the Philippine government has been promoting the country as a retirement haven for foreigners. However, it is only in the last few years that they have actively sought Korean retirees."

Attractions
"Relying on its tropical weather, friendly people and low cost of living, the Philippines is touting itself as Asia's retirement haven to attract foreigners, especially Chinese, Japanese, Koreans, Americans and Europeans."

The paper quoted Aglipay as having said that the government was "focusing on the Korean market because of the sheer volume of Koreans visiting the Philippines."

Koreans reportedly make up nearly 20 percent of foreign tourists to the Philippines.

Between January and April this year, more than 180,000 Korean tourists arrived in Manila, an increase of 10 percent over 2005 figures.

"With beach resorts in Boracay (Aklan), Cebu and Palawan always filled with Korean tourists, the Philippines' popularity as a leisure destination is undeniable. A Filipino resort owner said there are more Korean tourists in Boracay than Filipinos during summer," said the Korea Times.

Department of Tourism records showed that a total of 489,465 Koreans visited the country last year. There were 207,957 in 2001, 288,468 in 2002, 303,867 in 2003 and 378,602 Korean visitors in 2004.

According to the Korean newspaper, "the main attractions for Koreans traveling to the Philippines are the warm weather, low cost of living, good business opportunities and English-language education."

It also noted that "while Seoul continues to rank as one of the most expensive cities in the world (actually second after Moscow, according to a recent Newsweek magazine report), Manila has consistently been ranked as one of the least expensive."

"Living on 2 million won a month for Korean retirees in Seoul would be difficult. However, 2 million won converted into Philippine pesos or roughly P110,000 ($2,075) would make for easy living in the Philippines. For instance, a sizeable house in a gated community or a posh condominium unit can be rented for P20,000 to P30,000 a month (370,000 to 550,000 Korean won). For that money, the retirees can also have a car, driver, maid and send their children to a good school, and be able to live comfortably," the paper said.

'Korea towns'
The broadsheet also reported that "Koreans living in the Philippines should not get homesick as 'Korea towns' pop all over the country."

"One of the most well-known is in Barangay Poblacion in Makati (City). Here, there are dozens of Korean restaurants, churches, schools and supermarkets selling instant ramyon and kimchi. Even some Filipino-owned stores have signs written in Korean. Aside from Makati, many Korean retirees also choose to settle in quieter provincial cities such as Clark, Subic, Davao and Baguio."

The paper also featured Korean businessman Kim In-duk who had chosen to retire in Metro Manila because "the living conditions in the Philippines are better than in Korea."

The 62-year-old Kim lives with his wife and two sons in a Makati condominium. They have a vacation home in nearby Tagaytay City and "enjoy traveling the Philippines in their free time."

"Kim does not have any plans to live again in South Korea, saying he is content with his life in Manila. He is literally the poster boy for the Philippine (government) retirement program, since his face is displayed in pamphlets written in Korean and distributed around South Korea," including the Daejeon metropolitan city, a two-hour drive from Seoul and about 350 kilometers south of the Demilitarized Zone, which separates South Korea from the communist north.

The Inquirer traveled to Daejeon upon the invitation of the same Korean business group, which established the Philippine-Korean Cultural House in the South Korean capital.

The group, led by Son Jong Sun, James Kim and David Song, has vowed to promote not just Philippine cultural activities but also the PRA program.

Investors
In March, the PRA accredited at least 55 retirement villages and other facilities throughout the Philippines.

Just recently, a Korean business group expressed interest in putting up a retirement village in Nasugbu, Batangas, disclosed Aglipay.

But China still has the "greatest potential of all PRA's focus markets (worldwide) due to its size."

"The Philippines, through its SRRV mechanism, can tap into the motivations of the Chinese by presenting itself as a business destination and a location where Chinese entrepreneurs and businessmen can develop satellite offices and alternative businesses for their existing operations in mainland China."

Retirees visa
Applying for a Special Resident Retirees Visa (SRRV) in the Philippines is relatively easy. Applicants must be foreign nationals, 35 years old and above. Those aged 35 to 49 are required to make a cash deposit of $75,000, while those over 50 need to post cash deposit of $50,000.

The SRRV is a non-immigrant, multiple entry visa. It gives a foreigner the right to reside permanently in the Philippines.

SRRV benefits include exemption from the following: exit clearance and re-entry permit, Bureau of Customs duties and taxes for the importation of personal effects worth up to $7,000, special study permit, and the Bureau of Immigration's annual registration requirements.

Other benefits include tax-free remittance of annuities and pensions, guaranteed repatriation of retirement deposit and government assistance in obtaining an Alien Employment Permit.

South Korean retirees "can do almost everything except buy land and vote in the elections," according to Aglipay.

In the Philippines, he noted, Korean retirees could "experience hospitality, friendliness and innate respect and love for the elderly."

Aglipay also promised the Koreans "wherever your travels take you in our 7,107 islands, you will experience the unique charm of this historic land. Filipinos' zest for life has made us a world-class professional human resource."

For sure, he said, the Philippines was "definitely better than Malaysia or Thailand as retirees' destination this side of the globe."

"There are around 12 million Filipinos all over the world and that's already half of the population of Malaysia. They're highly skilled and caring people and definitely world-class. That's why, the Malaysians cannot claim they are better than us," he added.



Copyright 2006 Inquirer. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Saturday, August 26, 2006

Holiday tours and Packages in Manila Philippines


CEBU CITY TOUR
BEACH HOLIDAY AT Malibago Beach Resort
Stay at Shangri-la Resort- CEBU
Intramuros Experience
Shop till u drop
Villa Escudero Tour.doc
Bohol Island Day Tour
Island Hopping tour
Stay at Malibago bluewater Resort.doc
3Nights 4days Manila_Pagsanjan falls tour
3Nights 4days Manila_Pagsanjan falls tour Itenerary
Battle of Corregidor Tour
Lagaslas at Pagsanjan falls
Taal Trekking
Cebu Golf and Country Club
Malibago Beach Resort2
Mactan Island Tour
Hidden Valley Eden Revisited
Manila City Tour
Tagaytay Tour



WOW Philippines

About the Country, Tourist Destination, Guide and Information


Visit the Beautiful Island of the Philippines. Here are guides and related information about living, working or visiting / travelling our beautiful country, Philippines.

It includes personal stories and articles by foreign visitors who admires and love Philippines.



Minalunago National Park (Gapan City)
Click the Image for more Philippine Pictures!

"One day, I was listening to a UK radio program when I heard that someone won in a contest. I feel proud for my country when the winner say's that "I won and I'm going to a holiday (vacation) in Philippines?, oh yes, I Love Philippines especially their beaches!" then I smiled when I heard the english woman. If foreign people loves our country why don't we love it and promote it first?

That's why, this column is to promote the beautiful places in the Philippines...popular or not well-known places, you may send us your articles and I'll feature it here. - Vanie

Email us you articles and pictures of places at admin@ofw-connect.com or simply register on this OFW Connect Info Hub Section then submit any of your story/articles.

VISIT PHILIPPINES! IT IS WOW PHILIPPINES!

Why you should invest in Philippine Real Estate?

* Property developments are designed using international concepts and standards.

* Philippine property appreciates at an average of 10% per year, which is higher than 3 to 6% US properties get. This translates to a higher Return On Investment (ROI)

* Rental income from property is a stable source of income, and while it may fluctuate, is highly unlikely to vanish altogether, unlike stocks.

* Prices in Metro Manila are inexpensive compared to other major cities around the world.

* Strategically-located developments near Central Business Districts (CBDs) in urban cities, schools, malls, churches and hospitals.

* Due to the effects of the 1997 Asian economic downturn, prices are very affordable and the payment options and/or financing terms more flexible.

* Housing is always a rewarding investment as it gives one a sense of pride and ownership

* After a 7-year downturn, the Asian market that includes the Philippines is expected to recover and outperform other markets.

* Consumer incomes are rising, unemployment is falling and interest rates are modest.

* Property is a good hedge against inflation

* Real estate always has a residual value. Although prices can certainly fall as well as rise, property values will never fall to zero unlike shares or hedge funds.

* Property is a kind of hybrid asset with the capital appreciation of a stock but the income producing capacity of a bond.

* Real estate in prime locations is always an excellent collateral security against loans, and allows financing to be secured anytime.

* Units in projects are being sold pre-development generally appreciate in value when the project is finished.

* Buying real estate on installment basis is like buying a pre-need plan. Paying for it in installment for a future need.

* The demand for housing of all types is greater than supply. The backlog for housing is about 4 million units.

Philippine Property Ownership

Foreign Ownership of Philippine Real Estate & Assets

Foreigners can protect their Philippine investments into Philippine real estate and other investment assets. We provide Foreign Nationals Philippine Incorporation services so they can protect their Philippine investment interests. More information on this is provided below, and or contact us for further information.

Right To Own Philippine Real Property

Currently the general rule is that only Filipino citizens and corporations or partnerships at least 60% Philippine owned are entitled to acquire land in Philippines. As an exception to this rule, an alien acquisition of Philippine real estate is allowed in the following cases. Acquisition before the 1935 constitution. Acquisition thru hereditary succession if the foreign acquire is a legal heir. Purchase of more than 40% interest as a whole in a condominium project. Purchase by a former natural born Filipino citizen subject to the limitations prescribed by law. A Filipino who is married to an alien retains their Philippine citizenship, unless by their act or omission they are deemed to have renounced their Philippine citizenship.

Special Visas for Foreigners Investing in the Philippines

There are different visa options available to foreigners that allow foreign investment and of Philippine land and real estate properties. Contact us with your complete name, address, telephone, mobile, and email address to obtain an appointment with Philippine immigration officials to find out more information. Or go to the official web site of the Philippine Government Bureau of Immigration for more information. http://www.immigration.gov.ph. We process these types of visas for those that choose to and that qualify.

Foreign Ownership as a Philippine Corporation

The typical common way for foreign nationals to invest in Philippine real estate is for the Foreign national and or foreign corporation to create a Philippine corporation to hold title. This allows the Philippine corporation of a foreign national or foreign corporation less investment risk and more control of their Philippine real estate investments, and other Philippine investment assets. Foreign nationals, and corporation may 100% own a Philippine condominium or town home. For private land, residential home with land lot and or commercial building with land lot ownership the foreign national and or corporation forms a Philippine Corporation to take ownership of the property. A Philippine Corporation with Foreign Nationals as part by Philippine law will be a maximum of 40% foreign owned, and a minimum of 60% Filipino owned with a minimum of five incorporators. The Philippine corporation by law shall have a main bank account tied to it before and upon incorporation. A foreign national may be the sole person on the Philippine corporation bank account once after the Philippine corporation has been created and power of attorney has been handed over to the foreign investor at the time of incorporation. Thus allowing the foreign national total control over the funds derived and paid out from the Philippine Corporation and from the income or sale of the asset or real estate property.

Form a Philippine Corporation to hold Title

We provide our foreign national clients incorporation services. Most incorporations are simple and affordable to process depending on the type of corporation to be formed. Different types of corporations have different rules, regulations, and minimum capital funding requirements. Typical incorporations to hold Philippine real estate may be a “General Real Estate” or “Trading or Marketing Company” or something similar to be able to buy, hold and sell Philippine real estate property. The first step to forming a Philippine Corporation is having Philippine incorporation partners you can trust to be a team players with you in your Philippine investment plans. Many times the Philippine incorporators will be Philippine family, relatives, friends, business associates whom the foreign national can trust to be a part of the Philippine corporation. With additional separate legal enforceable agreements such as a power of attorney and other types of agreements, Philippine incorporators become team players with foreign investor partners wishing to make Philippine investments without having their investments at risk in case of unforeseen events or changes in their investment plans. If you are interested to know more about Philippine Incorporation Services and how we help protect our foreign clients Philippine investments interests, contact us with your further questions, and or lets arrange a meeting so we can discuss your Philippine investment plans. We only provide legal means for foreign investors to protect their capital, and interests in Philippine investments. We provide services that follow Philippine investment laws, rules, regulation, and do not provide services to violate these or perform money laundering. We comply and follow the international money laundering rules and regulations.

New Dual Citizenship Laws Affecting Property Ownership

Dual citizenship is now newly available for the following. Dual citizenship means having two citizenships and passports from two different countries. Former Philippine citizens born in the Philippines, but that have immigrated to another country and obtained citizenship of that country. Dual citizenship allows the citizenship holder full rights of possession of Philippine real estate property. Currently this is a new law and the procedures to implement this new law are not yet in place. Check back for updates on this new law, and the implementation procedures.

Foreigner Married to a Philippine Citizen

If holding title as an individual, a typical situation would be that a foreigner married to a Philippine spouse citizen would hold title in the Philippine spouses name. The foreign spouse name cannot be on the property Title but can be on the contract to buy the property, and should be to document the process taken to obtain such asset. In the event of death of the Philippine spouse, the foreign spouse is allowed a “reasonable” amount of the time from the Philippine government to dispose of the property and collect the proceeds or the property will pass to any Philippine heirs and or relatives. As a foreign investor caution should be taken upon considering and taking title to Philippine real estate in this manner. In the event of problems with the Philippine spouse and the investment assets in the Philippine spouse name, the foreign national may not have many rights to the assets or any at all. Contact us before you choose this option of holding Philippine assets as a foreign national.

Foreign Leasing of Philippine Real Estate Property

A foreign national and or corporation may enter into a lease agreement with Filipino landowners for an initial period of up to 50 years, and renewable for another 25 years. Or lease the property in your Philippine Corporation name for an unlimited period of time.

Former Philippine Citizens

“Balikbayan”, which is a former natural born Filipino citizen, and now is a citizen of another country is entitled to own for residential purpose 1,000square meters of residential land, and one hectare of agricultural or farm land. For business purpose 5,000 square meters of urban land or three hectares of rural land.

Philippine Real Estate Sales Transaction & Closing Costs Buyers

transaction or closing costs include the following. Documentary Stamp Tax – P5.00 per P1,000 of contract price, or zonal value or fair market value, which ever is higher. Transfer Tax– P5.00 per P1,000 of contract price, or zonal value of fair market value, which ever is higher. Registration Fee – P1.50 per P1,000 of contract price, or zonal value or fair market value, which ever is higher. The seller is responsible for transaction closing cost of capital gains tax. This is Philippine Real Estate Law.

Philippine Law Real Estate Acquisition and Disposition Definitions

Acquisition is the act of procuring or getting a hold of real estate property. Disposition is the manner of alienation, transfer of possession and ownership thereof as prescribed by the Philippine law. The acquisition and disposition of real estate is embodied in written agreements or contracts voluntarily entered into and subscribed by the selling and buying parties thereof, before a public officer designated as the Notary Public of the City or Province where the subject property is located. Thereafter, the instrument embodying the particular real estate transaction is required by law to be recorded in the Registry of Deeds in the City or Province where the real estate property is involved and located. The Philippines uses the Torrens” system of real estate ownership. See below for more information.

Torrens System of Real Estate Ownership

An adapted form of the “Torrens” system of land registration is used in the Philippines. The system was adapted to assure a buyer that if he buys a land covered by an Original Certificate of Title (OCT) or the more familiar Transfer Certificate of the Title (TCT) issued by the Register of Deeds, the same will be absolute, indefeasible and imprescriptibly. The registered owner will never lose his ownership to squatters no matter how long such land was illegally occupied.

Condominium Residential Commercial Development Ownership Law

Presidential Decree No. 957, which regulates the sale of subdivision and condominium developments, and providing penalties for violations thereof. The National Housing Authority has exclusive jurisdiction to regulate real estate trade and business, a function, which is presently exercised by the Housing and Land Use Regulatory Board (HLURB). Certain conditions are required before a license to sell condominium development units and or subdivision development lots and homes is issued to a Filipino owned individual or corporation. The requirements include a certificate of registration, a performance bond, and an approval of the building plans and specifications. Violation of these rules could mean fines, cancellation of license and or imprisonment.

BY: Cristina Lajato