Real Estate Service Coach [RESC]

10/11/2009

The Exclusive Buyer Agent (EBA) - Part 2 of 2

[Full Lecture on Exclusive Buyer Agent]

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Go to PART 1
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WHAT ARE THE FUNCTIONS OF AN EBA?

Functions for Buyer-Clients

- Assist the buyer in researching the various listing from unlimited sources.

- Ensure that all properties that will be shortlisted have proper property information folder or full disclosure paperwork.

- Research and inform the buyer of any hidden defects and hazards of the property and location (i.e. flood, fault-line, soft-soil, undesirable neighborhood, water utility monopoly, etc.).

- Reverses any overpricing and represents the buyer in negotiation to pull the price down.

- Prevent future problems by ensure that all details of the contract does not put the buyer in a disadvantageous position in scenarios involving "surprise" expenses after the signing of sales contract such as special taxes, charges, and fees that are not previously known.

- Represents the buyer in case the buyer have after-purchase complaints against the seller or against the seller's agent. These complaints are lodged and settled in the arbiters' offices of the Housing and Land Use Regulatory Board (HLURB), wherein only licensed real estate professionals can make representation. The HLURB is also the place where complaints against unregistered agents who sell real estate projects are filed.

Special Function for Non-Buyer-Clients

Another special function of an EBA is related to private investigation. Some clients discretely engage an EBA to watch over, review, investigate, and look for irregularities in a specific real estate purchasing transaction. Some are being conducted for political mileage purposes, some are for journalism purposes, and some are for anti-corruption advocacy purposes. This is the reason why I took advance courses in the US Academy of Private Investigation to supplement my professional expertise in real estate broker services.

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WHO PAYS THE AGENTS?

This is a classic frequently asked question -- "who pays the agents"? Even brokers ask me this question.

My repeated answer was always "wherever that money came from" - in short the BUYER.

So, regardless of whoever actually does pay the agent, regardless of whoever issued the check to the agent, whether the seller or the developer, it is always the buyer's money that is used to pay the agent. It is the buyer who pays for the property being purchased, the closing fees and taxes, and the agent's commission.

With an EBA, it is not only the price of the property that will be pulled down, but all the add-ons that are calculated based on the final price. Every peso that these items go down is a savings of the buyer. The term "buyer's savings" is the reason why EBA exists. A buyer could save half a million pesos by just spending a hundred thousand pesos to an EBA.

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HOW ARE EBA's PAID?

Before I jump into the discussion of how EBAs get compensated, let me beg to disagree to the classic trending of EBAs in the United States. They are saying that getting an Exclusive Buyer Agent will cost a buyer nothing. Well, that is true if you will not consider the commission of the agents as one of the proceeds of the money that is used to pay the price of the property that comes only from the buyer. In how I see things clearly, I would rather honestly say that getting a services of the EBA will cost the buyer less.

There are two best options to pay the professional services of an EBA. You will need to talk freely with your EBA and ask for a presentation of comparative analysis of the options so you can decide which option works well in your case.

Split Commission

The first and simplest option is called Split of the Commission between the listing agent and the buyer's agent. This option is always taken when (1) the buyer agrees to this option, and (2) the seller agrees to this arrangement.

Under this option, the buyer gets the representation without directly paying the EBA. This option is always acceptable, as it is inevitable, because in most cases, the seller of the property almost always offers a commission to agents.

Professional Fee

The second option is called Professional Fee. This fee could be a (1) pre-agreed fixed amount, (2) periodic retainer, (3) percentage reward out of the amount the EBA can pull the price down from the listing price down to a negotiated price, or (4) combination of the three.

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WHEN SHOULD BUYERS CONSULT WITH AN EBA?

This part will discuss TIMING. There are two parts of EBA services. The first is Needs Analysis, and the second is Actual Engagement.

Needs Analysis is the focus of discussion during initial consultation with an EBA. A potential buyer should go to the EBA at the moment the idea of purchasing a property crosses his mind. An EBA usually interviews a potential buyers financial situation to come up with a recommendation as to the correct timing to buy.

For buyers with big wants but limited resources, the EBA can explain long term planning, savings preparation, and credit strengthening -- no hurry and no pressure. For buyers who have ready money and tight deadline, an EBA, during initial consultation, can immediately develop a workplan to achieve the goal on time. EBAs can work well and effectively in the fullest extent when the buyer signs up for his services before the buyer start searching for properties in the market.

Everything the buyer does or says, without EBA representation, are pieces of actions and information that are released to the market that can be used by sellers agents to defeat the strategy of the EBA. In short, the buyer must get an EBA before talking or dealing with anyone, even with their internal purchasing staff.

If it is a huge buy, it is very important that the buyer must remain silent, or much better if identity is unexposed, all throughout the pre-buying period while the EBA leads the negotiation with listing agents and sellers. The reason being is that once the intent of a huge buy is exposed to the market, it naturally increases the prices of properties in that particular area -- and this is not good for the buyer.

There are moments when the EBA will turn down a client's request for services. One is when the EBA already has an existing client with almost similar requirement - same budget, type of property, location, and intended use. The reason being is that the EBA cannot present the best property to two clients for some reason that it may contaminate the "100% loyalty principle". Besides, it will create an "auction effect" that will push the price up, which is basically contrary to the mission of the EBA. When this happens, the second client must wait after the EBA is done with the first client.

The other instance that may lead to EBA non-acceptance of a client is when the EBA detects during the first consultation that the buyers does not need EBAs -- buyers who believe (1) that they can find their best choice as a result of their own research and (2) that it is much easier to bargain the price with sellers if they go in without a professional price bargainer.

Actual Engagement of an EBA the the implementation of the planned workload. Most EBAs are very selective of their clients under this part of the workload -- acceptance of engagement has three criteria. The primary criteria is financial readiness of the buyer. The second criteria is the price of the property that is intended to be purchased. The third criteria is the work schedule capacity of the EBA to accept a new workload.

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WHERE DO EBAs GET LISTING INFORMATION?

Take note that EBAs are not listing agents. They don't have listings. They don't have an inventory of properties to sell where they can get commission from. But they know where these listings can be found.

In order to meet the reqirement of client buyers, EBAs get their listing information from various sources, such as:

- Various Multiple Listing Services
- Suggestions of the buyer
- Properties foreclosed and are nearly foreclosed by banks
- Properties expropriated by local government units for failure of owners to pay real estate tax
- Properties advertised in the newspapers, classified ads, and internet
- Developers (big and small)
- Various realty companies
- Multiple listing baskets of brokers' associations
- Search on foot and saturate the whole area with an offer to buy fliers

Will the EBA broker any property a buyer points his/her finger to? Yes, even if it is not advertised for sale, an EBA can talk to the owner to present an offer to buy such property. Take note that finding probable properties is a joint effort of the EBA and the client buyer. The main objective of the EBA-Buyer teamwork and collaboration is to come up with sufficient number of comparisons. After the teamwork comes up with the wide range of choices, it has to be the EBA who will do the initial contact with the sellers to ensure that the shortlist of properties that will be inspected by the buyer are readily screened and worry-free.

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WHO ARE THE IDEAL CLIENTS OF EBAs?

An Exclusive Buyer Agent is highly recommended to be engaged in expropriation proceedings by Government and major land or business acquisition by Real Estate Investment Trust Corporations (REITS).

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Go to PART 1

Code of Ethics in Philippine Real Estate Service - Part 1 of 2

Code of Ethics governs the conduct of those in realty service practice. Most of the principles contained herein are also discussed in the DTI-BTRCP Rules and Regulations under M.O. Order No. 39, Series of 1985.

Violations by the broker of any provisions of the Code, gives rise to sanctions that may be imposed by the brokers organization, without prejudice to disciplinary action that concerned DTI-BTRCP may impose when a complaint is filed against him.

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Go to PART 1
Go to PART 2

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INTRODUCTION

The Realty Service Practice, a profession, calling or occupation, is dedicated to the promotion,development and conservation of land and natural resources, including improvements and rights and interest appurtenant thereto for the benefit and enjoyment of the Filipino people. As such, those engaged therein are bound by a code of conduct, morals, and values in performance of their duties and obligations towards the government, co-practitioners and the people they serve.

It is, therefore, imperative and necessary to adopt this NATIONAL CODE ETHICS FOR THE REALTY SERVICE PRACTICE to govern the rule of conduct of those who will engage therein.

ARTICLE 1 – DECLARATION OF PRINCIPLES

SECTION 1. The Realty Service Practice is a noble profession, calling or occupation and those engaged therein shall abide by and comply with all the laws, decrees, orders and rules and regulations enacted or promulgated by duly constituted government authorities.SECTION 2. Utmost fidelity, sincerity, respect for colleagues in the profession, and honesty shall be observed at all times by those in the realty service practice in their relation with the client, the community and the nation in general.

SECTION 3. Adequate knowledge, competence and expertise in real estate development and management shall be maintained, and the upgrading of the standards of practice shall be effected when the need arises; all these for, and in the interest of the social and economic progress of the country.

SECTION 4. The spirit of camaraderie, cooperation and professional relationship among the practitioners shall be promoted; and every organization to which they shall be encouraged to join shall aims and purposes as will set up, upgrade, and maintain a high level of integrity, honesty and competence in the profession for the best interests of the community and the nation.

SECTION 5. A high level of professional relationship with colleagues in the Realty Service Practice shall be maintained, and their dealings with each other shall always be fair, honest and just.

SECTION 6. The Golden Rule which reads “Treat others as you like them to treat you.” shall be observed in all the dealings and relation of the practitioners with clients, fellow practitioners, the organization to which they belong, and the general public.

ARTICLE II – SCOPE AND PURVIEW OF THE CODE

SECTION 1. As used in this code and for the purpose hereof, the Realty Service Practice shall embrace and include all persons, partnership or corporations who are duly licensed by the Bureau of Domestic Trade in accordance with SECTION 3 (e) & (ee) of Act. No. 2728 as amended by Act No. 3715 & 3969 and Ministry Order No. 39, such other practitioners as the Director of Domestic Trade may now or hereafter license pursuant to any law, rule or regulation that may be promulgated by the government. They shall be called Realty Service Practitioners hereinafter known as Practitioners.

ARTICLE III – RULE OF CONDUCT AND PRACTICE

The Practitioners shall be governed by the following rules of conduct and practice.

SECTION 1. RELATION TO THE GOVERNMENT

(a) The Practitioner should secure all the necessary Licenses, permits and authority from the Bureau of Domestic Trade and other government agencies as may be required by law, ordinance or rules and regulations and comply with all the requirements thereof engaging in the same.
(b) He should pay any and all taxes, fees, dues, levies or changes that the government may impose in accordance to law, ordinances, or rules and regulations.
(c) He should help, assist and cooperate with the Bureau of Domestic Trade and all government agencies and instrumentality in the promotion, development and conservation of lands and other natural resources, its improvements and rights and interest therein.
(d) He should not encourage, abet, tolerate or participate in the evasion or illegal reduction in the payment of all taxes, fees, dues, levies or charges that may be imposed by the government.
(e) He should not offer or agree to pay, to split or rebate any commission, fee or valuable consideration, directly or indirectly with any person who is not duly licensed practitioner or to cooperate, assist or endorse any transaction or engagement of his services in violation of any existing law, rule or regulation.
(f) He should indicate the license number of the certificate issued by the Bureau of Domestic Trade in his letterhead, dry seal, signboard, billboard, advertisement of other announcement in relation to the Realty Service Practice.

SECTION 2. RELATION TO THE PUBLIC

(a) The Practitioner should be imbued with a social conscience for he does not live by himself and his family alone but he is a part of society with social responsibilities.
(b) He should ensure the highest and best use of the land and the equitable distribution of ownership, irrespective of political beliefs, cultural background, sect, religion or class.
(c) He should keep himself well informed to any movement affecting real estate in his community, city or province, so that he may be able to contribute to public thinking on matters of taxation,land use, city planning and other programs of the government.
(d) He should cooperate with the government in protecting the public against deceptive, unfair and unconscionable acts and practices of some unscrupulous or unlicensed practitioners like fraud, misrepresentation, concealment of relevant information and other related unethical practices.
(e) He should ascertain all pertinent facts concerning every property and avoid error, exaggeration, misrepresentation or concealment of pertinent facts.
(f) He should not be instrumental in introducing in a neighborhood a certain character or use of property which will tend to impair or erode property values within that neighborhood.
(g) He should not be a party to the naming of a false consideration in a deed or instrument.
(h) He should keep a special bank account separate and distinct from his own funds, all monies received in trust for other persons, such as deposit in escrow, trust funds, client’s money and similar items.
(i) In his advertisements, brochures or announcements, he should present a true picture of the property, its improvements, or rights and interests therein including whatever liens or encumbrances it may have, if any, and should indicate his name, fi rm name, address and license number of the Certificate of issued by the Department of Trade and Industry. In case of real estate salesman, he should indicate the name, fi rm name and license number of the broker under whom he is employed.
(j) He should see to it that all agreement, terms and conditions, financial obligations and commitments in real estate transactions are in writing, duly signed by all parties concerned and if necessary, to be properly authenticated by a Notary Public.

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Go to PART 1
Go to PART 2

If there is anything else important that I forgot to include in this article, or if you experienced a real estate transaction that is anomalous, scam, fraudulent scheme that you want me to document and expose for others to be warned, or if you want to donate to the war chest of real estate consumer rights advocacy, please feel free to email me at JohnPetalcorin@Gmail.Com. If you want to comment about this article, there is a provision for this purpose that you can find below.
Thank you so much for visiting my site. May God Bless You!

RA 9646 - Real Estate Service Act of the Philippines (full text)

Explanatory Note by John Petalcorin on 07/16/2009.

The Philippine real estate practice was used to be regulated by the Ministry Order 39 of the Bureau of Trade Regulation and Consumer Protection of the Department of Trade and Industry (DTI-BTRCP) . To strengthen the MO 39, a Real Estate Service Bill was filed in House of Representatives (Congress Lower House) in October 22, 1987 during the time of President Corazon Aquino. After 22 years and four Presidents, it was finally approved by the President Gloria Macapagal-Arroyo on June 29, 2009 and became a Republic Act No. 9646 entitled Real Estate Service Act of the Philippines.

The law was published in the Philippine Daily Inquirer on July 15, 2009. In accordance with Sec. 45 of Republic Act No. 9646, the Act shall take effect fifteen (15) days following its publication in the Official Gazette or in a major daily newspaper of general circulation in the Philippines.

Republic Act 9646 Real Estate Service Act

REPUBLIC OF THE PHILIPPINES }
AN ACT REGULATING THE PRACTICE OF REAL ESTATE SERVICE IN THE PHILIPPINES, CREATING FOR THE PURPOSE A PROFESSIONAL REGULATORY BOARD OF REAL ESTATE SERVICE, APPROPRIATING FUNDS THEREFOR AND FOR OTHER PURPOSES

Be it enacted by the Senate and House of Representatives of the Philippines in Congress assembled:

ARTICLE I. TITLE, DECLARATION OF POLICY AND DEFINITION OF TERMS

SEC. 1. Title

This Act shall be known as the “Real Estate Service Act of the Philippines.”

SECTION 2. Declaration of Policy

The State recognizes the vital role of real estate service practitioners in the social, political, economic development and progress of the country by promoting the real estate market, stimulating economic activity and enhancing government income from real property-based transactions. Hence, it shall develop and nurture through proper and effective regulation and supervision a corps of technically competent, responsible and respected professional real estate service practitioners whose standards of practice and service shall be globally competitive and will promote the growth of the real property industry.

SEC. 3. Definition of Terms

As used in this Act, the following terms shall mean:

(A) “Appraiser” also known as valuer, refers to a person who conducts valuation/appraisal; specifically, one who possesses the necessary qualifications, ability and experience to execute or direct the valuation/appraisal of real or personal property.

(B) “Assessor” refers to an official in the local government unit, who performs appraisal and assessment or real properties, including plants, equipment, and machineries, essentially for taxation purpose. This definition also includes assistant assessors.

(C) “Real estate” refers to the land and all those items which are attached to the land. It is the physical, tangible entity, together with all additions or improvements on, above or below the ground.

(D) “Real estate development project” means the development of land for residential, commercial, industrial, agricultural, institutional and recreational purposes, or any combination of such including, but not limited to, tourist, resorts, reclamation projects, building or housing projects, whether for individual or condominium ownership, memorial parks and others of similar nature.

(E) "Real estate developer" refers to any natural or juridical person engaged in the business of developing real estate development project for his/her or its own account and offering them for sale or lease.

(F) “Real property” includes all the rights and benefits related to the ownership of real estate.

(G) “Real estate service practitioners” shall refer to and shall consist of the following:

(1) Real Estate Consultant – a duly registered and licensed natural person who, for a professional fee, compensation or other valuable consideration, offers or renders professional advice and judgment on: (i) the acquisition, enhancement, preservation, utilization or disposition of lands or improvements thereon; and (ii) the conception, planning, management and development of real estate projects;

(2) Real Estate Appraiser – a duly registered and licensed natural person who, for a professional fee, compensation or other valuable consideration, performs or renders, or offers to perform services in estimating and arriving at an opinion of or acts as an expert on real estate values, such services of which shall be finally rendered by the preparation of the report in acceptable written form;
(3) Real Estate Assessor – a duly registered and licensed natural person who works in a local government unit and performs appraisal and assessment of real properties, including plants, equipment, and machineries essentially for taxation purposes.
(4) Real Estate Broker – a duly registered and licensed natural person who, for a professional fee, commission or other valuable consideration acts as an agent of a party in a real estate transaction to offer, advertise, solicit , list, promote, mediate, negotiate or effect the meeting of the minds on the sale, purchase, exchange, mortgage, lease or joint venture, or other similar transactions on real estate or any interest therein;
(5) Real Estate Salesperson – a duly accredited natural person who performs service for, and in behalf of, a real estate broker who is registered and licensed by the Professional Regulatory Board of Real Estate Service for or in expectation of a share in the commission, professional fee, compensation or other valuable consideration.

ARTICLE II. PROFESSIONAL REGULATORY BOARD OF REAL ESTATE SERVICE

SEC. 4. Creation and Composition of the Board

There is hereby created a Professional Regulatory Board of Real Estate Service, hereinafter referred to as the Board, under the supervision and administrative control of the Professional Regulation Commission (PRC), hereinafter referred to as the Commission, composed of a chairperson and four (4) members who shall be appointed by the President of the Philippines from the three (3) recommendees chosen by the Commission from a list of five (5) nominees per position submitted by the accredited and integrated professional organizations of real estate service practitioners [AIPORESP]: Provided, that two (2) members of the Board shall represent the government assessors and appraisers.

The first Board shall be organized within six (6) months from the effectivity of this Act.

SEC. 5. Powers and Functions of the Board

The Board is hereby vested the following powers and functions:

(A) Provide comprehensive policy guidelines for the promotion and development of the real estate industry;

(B) Conduct licensure examinations for the practice of the real estate service profession and prescribe the appropriate syllabi of the subjects for examination;

(C) Issue, suspend, revoke or reinstate, after due notice and hearing, certificates of registration or professional identification cards for the practice of real estate service;

(D) Maintain a comprehensive and updated register of licensed real estate service professionals;

(E) Monitor the conditions affecting the practice of real estate service and adopt such measures as may be proper for the enhancement of the profession and/or the maintenance of high professional, ethical and technical standards;

(F) Adopt the national Code of Ethics and Responsibilities to be strictly observed by all licensed real estate service practitioners;

(G) Hear or investigate any violation of this Act, its implementing rules and regulations, and the Code of Ethics and Responsibilities for real estate service practitioners and issue subpoena and subpoena duces tecum to secure the appearance of witnesses and the production of documents in connection therewith;

(H) Safeguard and protect legitimate and licensed real estate service practitioners and, in coordination with the accredited and integrated professional organization of real estate practitioners [AIPORESP], monitor all forms of advertisements, announcements, signboards, billboards, pamphlets, brochures and others of similar nature concerning real estate and, where necessary, exercise its judicial and police powers to finally and completely eradicate the pernicious practices of unauthorized or unlicensed individuals;

(I) Prescribe, in cooperation with the Commission on Higher Education (CHED) or the concerned state university or college, the essential requirements as to the curricula and facilities of schools, colleges or universities seeking permission to open academic courses or already offering such courses in real estate service, and to see to it that these requirements, including the employment of qualified faculty members, are properly complied with;

(J) Promulgate, administer and enforce rules and regulations necessary in carrying out the provisions of this Act;

(K) Supervise and regulate the registration , licensure and practice of real estate service in the Philippines;

(L) Assess and fix the rate of reasonable regulatory fees;

(M) Administer oaths and affirmations;

(N) Adopt an official seal of the Board;

(O)Evaluate periodically the status of real estate service education and profession, and recommend and/or adopt measures to upgrade and maintain its high standard;

(P) Prescribe guidelines and criteria for the Continuing Professional Education (CPE) program for real estate service practitioners in consultation with the accredited and integrated professional organizations of real estate service practitioners [AIPORESP];

(Q) Screen, issue and monitor permits to organizations of real estate professionals in the conduct of seminars and accredit such seminars pursuant to the CPE program, as well as the instructors or lecturers therein, for the purpose of upgrading the quality and knowledge of the profession;

(R) Monitor and supervise the activities of the accredited and integrated professional organizations and other associations of real estate service practitioners [AIPORESP]; and

(S) Discharge such other powers, duties and functions as the Commission may deem necessary to carry out the provisions of this Act.

The policies, resolutions, rules and regulations issued or promulgated by the Board shall be subject to the review and approval by the Commission. However, the Board’s decisions, resolutions or orders which are not interlocutory, rendered in an administrative case, shall be subject to review by the Commission only on appeal.

SEC. 6. Qualifications of the Chairperson and the Members of the Board

The chairperson and the members of the Board shall, at the time of their appointment, possess the following qualifications:

(A) A citizen and resident of the Philippines;

(B) A holder of a bachelors degree related to real estate;

(C) An active licensed practitioner of real estate service for at least ten (10) years prior to his/her appointment;

(D) A bonafide member in good standing of the accredited and integrated professional organization of real estate service practitioners [AIPORESP] but not an officer or trustee at the time of his/her appointment;

(E) Neither be a member of the faculty of an institute, school, college or university, nor have any pecuniary interest, direct or indirect, in any institution or association where review classes or lectures in preparation for the licensure examination are being offered or conducted; and

(F) Of good moral character, and must not have been convicted by final judgment by a competent court of a criminal offense involving moral turpitude.

SEC. 7. Term of Office

The chairperson and the members of the Board shall hold office for a term of three (3) years from the date of their appointment and until their successor/s shall have been appointed: Provided, That the members of the first appointed Board shall hold office for the following terms: one (1) member as chairperson, to serve for three (3) years; two (2) members, to serve for two (2) years; and two (2) members, to serve for one (1) year.

The chairperson and the members of the Board may be reappointed for a second term but in no case shall he/she serve continuously for more than six (6) years. Any vacancy in the Board shall be filled for the unexpired portion of the term, of the member who vacated the position. On the constitution of the first Board, the chairperson and the members of the Board shall automatically be registered and issued certificates of registration and professional identification cards. Each member of the Board shall take the proper oath of office prior to the assumption of duty.

SEC. 8. Compensation and Allowances of the Chairperson and the Members of the Board

The chairman and the members of the Board shall receive compensation and allowances comparable to the compensation and allowances received by the chairman and the members of existing professional regulatory boards under the Commission, as provided for in the General Appropriations Act.

SEC. 9. Removal of the Chairperson and the Members of the Board

The chairperson or any of the Board may be suspended or removed by the President of the Philippines, upon the recommendation of the Commission, for neglect of duty; abuse of power; oppression; incompetence; unprofessional; unethical, immoral, or dishonorable conduct; commission or toleration of irregularities in the conduct of examination or tampering of the grades therein; or for final judgment or conviction of any criminal offense involving moral turpitude.

SEC. 10. Supervision of the Board, Custodian of its Records, Secretariat and Support Services

The Board shall be under the general supervision and administrative control of the Commission. All records of the Board, including applications for examinations, examination papers and results, minutes of deliberations, administrative and other investigate cases involving real estate service practitioners, shall be kept by the Commission. The Commission shall designate the secretary of the Board and shall provide the secretariat and other support services to implement the provisions of this Act subject to the usual government accounting and auditing rules and regulations.

SEC. 11. Annual Report

The Board shall, at the close of each calendar year submit an annual report to the Commission, giving a detailed account of its proceedings and accomplishments during the year and recommending measures to be adopted with the end-in-view of upgrading and improving the conditions affecting the practice of real estate service in the Philippines.

ARTICLE III. LICENSURE EXAMINATION AND REGISTRATION

SEC. 12. Licensure Examination

Every applicant seeking to be registered and licensed as a real estate service practitioner, except a real estate salesperson, shall undergo an examination as provided for in this Act. Examinations for the practice of real estate service in the Philippines shall be given by the Board at least once every year in such places and dates as the Commission may designate.

SEC. 13. Scope of Examination

An examination shall be given to the licensure applicants for real estate brokers, real estate appraisers and real estate consultants which shall include, but not limited to, the following:

(A) For Real Estate Consultants – fundamentals of real estate consulting, standards and ethics; consulting tools and techniques, which include project feasibility study and investment measurement tools; real estate finance and economics; real estate consulting and investment analysis; consulting for specific engagement, which include consulting for commercial, industrial, recreation, and resort and hotel properties, and consulting for government and corporate and financial institutions; land management system and real property laws, and any other related subjects as may be determined by the Board.

(B) For Real Estate Appraisers – fundamentals of real estate principles and practices; standards and ethics; theories and principles in appraisal; human and physical geography; methodology of appraisal approaches; valuation procedures and research; appraisal of machinery and equipment; practical appraisal mathematics; appraisal report writing; real estate finance and economics; case studies; land management system and real property laws; and any other related subjects as may be determined by the Board; and

(C) For Real Estate Brokers – fundamentals of property ownership; code of ethics and responsibilities; legal requirements for real estate practice; real estate brokerage practice; subdivision development; condominium concept; real estate finance and economics; basic principles of ecology; urban and rural land use; planning, development and zoning; legal aspect of sale, mortgage and lease; documentation and registration; real property laws; and any other related subjects as may be determined by the Board.

To conform with technological and modern developments, the Board may recluster, rearrange, modify, add or exclude any of the foregoing subjects as may be necessary.

SEC. 14. Qualifications of Applicants for Examinations

In order to be admitted to the licensure examination for real estate service, a candidate shall, at the time of filing his/her application, establish to the satisfaction of the Board that he/she possesses the following qualifications:

(A) Citizen of the Philippines;

(B) A holder of relevant bachelor’s degree from a state university or college, or other educational institution duly recognized by CHED: Provided, that as soon as a course leading to Bachelor’s Degree in Real Estate Service is implemented by the CHED, the Board shall make this course a requirement for taking the licensure examination;

(C) Of good moral character, must not have been convicted of any crime involving moral turpitude: Provided, That an applicant for the licensure examination for real estate consultants must show proof that he/she has at least three (10) years experience as a licensed real estate broker or an assessor, or as a bank or institutional appraiser or an employed person performing real property valuation, or at least five (5) years experience as a licensed real estate appraiser.

All applicants for examination shall be filed with the Board which shall assess and approve said applications and issue to the qualified examinees the corresponding permits to take such examination.

SEC. 15. Ratings in the Examination

In order that a candidate may be deemed to have successfully passed the examination, he/she must have obtained an average of at least seventy-five percent (75%) in all subjects, with no rating below fifty percent (50%) in any subject.

SEC. 16. Release of the Results of Examination

The results of the examination shall be released by the Board within ten (10) days from the last day of the examination.

SEC. 17. Issuance of the Certificate of Registration and the Professional Identification Card

A certificate of registration shall be issued to examinees who pass the licensure examination for real estate service subject to payment of fees prescribed by the Commission. The certificate of registration shall bear the signature of the chairperson of the Commission and the chairperson and the members of the Board, stamped with the official seal of the Commission, indicating that the person named therein is entitled to practice the profession with all the benefits and privileges appurtenant thereto. This certificate of registration shall remain in full force and effect until revoked or suspended in accordance with this Act.

A professional identification card bearing the registration number, date of issuance and expiry date, duly signed by the chairperson of the Commission, shall likewise be issued to every registrant upon payment of the required fees. The professional identification card shall be renewed every three (3) years and upon satisfying the requirements of the Board, such as, but not limited to, attendance in the CPE program.

SEC. 18. Refusal to Register

The Board shall not register and issue a certificate of registration to any successful examinees who has been convicted by a court of competent jurisdiction of any criminal offense involving moral turpitude or has been found guilty of immoral or dishonorable conduct after investigated by the Board, or has been found to be psychologically unfit.

SEC. 19. Revocation or Suspension of the Certificate of Registration and the Professional Identification Card or Cancellation of Special/Temporary Permit

The Board may, after giving proper notice and hearing to the party concerned, revoke the certificate of registration and the professional identification card, or cancel the special or temporary permit of a real estate service practitioner, or suspend him/her from the practice of the profession on any of the following instances hereunder:

(A) Procurement of a certificate of registration and/or professional identification card, or special/temporary permit by fraud or deceit;

(B) Allowing an unqualified person to advertise or to practice the profession by using one’s certificate of registration or professional identification card, or special/temporary permit;

(D) Malpractice or violation of any of the provisions of this Act, its implementing rules and regulations, and the Code of Ethics and Responsibilities for real estate service practitioners;

(E) Engaging in the practice of the profession during the period of one’s suspension.

SEC. 20. Registration Without Examination

Upon application and payment of the required fees, the following shall be registered, and shall be issued by the Board and the Commission a certificate of registration and a professional identification card without taking the prescribed examination:

(A) Those who, on the date of the effectivity of this Act, are already licensed as real estate brokers, real estate appraisers or real estate consultants by the Department of Trade and Industry (DTI) by the virtue of Ministry Order No. 39, as amended: Provided, That they are in active practice as real estate brokers, real estate appraisers and real estate consultants, and have undertaken relevant CPE to the satisfaction of the Board;

(B) Assessors and appraisers who, on the date of the effectivity of this Act, hold permanent appointment and are performing actual appraisal and assessment functions for the last five (5) years, have passed the Real Property Assessing Office (RPAO) examination conducted and administered by the Civil Service Commission (CSC) in coordination with the Department of Finance (DOF), and have undertaken relevant CPE to the satisfaction of the Board; and

(C) Assessors and appraisers who, on the date of the effectivity of this Act, hold permanent appointment and have at least ten (10) years actual experience in real property appraisal or assessment and have completed at least one hundred twenty (120) hours of accredited training on real property appraisal conducted by national or international appraisal organizations or institutions/entities recognized by the Board and relevant CPE to the satisfaction of the Board.

Those falling under the categories (B) and (C) shall register with the Board after they shall have complied with the requirements for registration as real estate appraisers: Provided, That those seeking to be licensed to a new credential level shall be required to take the pertinent licensure examination.

Those so exempt under the aforementioned categories shall file their application within two (2) years from the effectivity of this Act: Provided, That the renewal of the professional identification card is subject to the provisions of Section 17 hereof.

SEC.21. Reinstatement, Reissuance or Replacement of Certificate of Registration, Professional Identification Card and Special/Temporary Permit.

The Board may, after the expiration of two (2) years from the date of revocation of a Certificate of Registration and/or Professional Identification Card, and upon application, compliance with the required CPE units , and for reasons deemed proper and sufficient, reinstate any revoked certificate of registration reissue a suspended professional identification card and in doing, may, in its discretion, exempt the applicant from taking another examination.

A new certificate of registration, professional identification card or special/temporary permit may be issued to replace lost, destroyed or mutilated ones, subject to the rules as may be promulgated by the Board.

SEC. 22. Roster of Real Estate Service Practitioners

The Board, in coordination with the integrated organizations of real estate service practitioners, shall prepare, update and maintain a roster of real estate service practitioners which shall contain the names of all registered real estate service practitioners, their residence and office addresses, license number, dates of registration or issuance of certificates, and other data which the Board may deem pertinent. Copies thereof shall be made available to the public upon request.

SEC. 23. Issuance of Special or Temporary Permit

Upon application and payment of the required fees and, subject to the approval of the Commission, the Board may issue special/temporary permit to real estate service practitioners from foreign countries whose services are urgently needed in the absence or unavailability of local real estate service practitioners for the purpose of promoting or enhancing the practice of the profession in the Philippines.

SEC.24. Foreign Reciprocity

No foreign real estate service practitioner shall be admitted to the licensure examination or be given a certificate of registration or a professional identification card, or be entitled to any of the privileges under this Act unless the country of which he/she is a citizen specifically allows Filipino real estate service practitioners to practice within its territorial limits on the same basis as citizens of such foreign country.

ARTICLE IV. PRACTICE OF REAL ESTATE SERVICE

SEC. 25. Oath

All successful examinees qualified for registration and all qualified applicants for registration without examination as well as accredited salesperson shall be required to take an oath before any member of the Board or any officer to the Commission duly authorized by the Commission to administer oaths prior to entering into the practice of real estate service in the Philippines.

SEC. 26 Professional Indemnity Insurance/Cash or Surety Bond

All real estate brokers and private real estate appraisers shall, in addition to the oath referred to in the preceding section, be required to post a professional indemnity insurance/cash or surety bond, renewable every three (3) years, in an amount to be determined by the Board, which in no case shall be less than Twenty Thousand Pesos (P20,000.00) without prejudice to the additional requirement of the client.

SEC. 27. Acts Constituting the Practice of Real Estate Service

Any single act or transaction embraced within the provisions of Section 3(G) hereof, as performed by real estate service practitioners, shall constitute an act of engaging in the practice of real estate service.

SEC. 28. Exemptions from the Acts Constituting the Practice of Real Estate Service

The provisions of this Act and its rules and regulations shall not apply to the following:

(A) Any person, natural or juridical, who shall directly perform by himself/herself the acts mentioned in Section 3 hereof with reference to his/her or its own property, except real estate developers;

(B) Any receiver, trustee or assignee in bankruptcy or insolvency proceedings;

(D) Any person who is duly constituted attorney-in-fact for purposes of sale, mortgage, lease or exchange, or other similar contracts of real estate, without requiring any form of compensation or remuneration;

(E) Public officers in the performance of their official duties and functions, except government assessors and appraisers.

SEC. 29 Prohibition Against the Unauthorized Practice of Real Estate Service

No person shall practice or offer to practice real estate service in the Philippines or offer himself/herself as real estate service practitioner or use the title, word, letter, figure or any sign tending to convey the impression that one is a real estate service practitioner, or advertise or indicate in any manner whatsoever that one is qualified to practice the profession, or be appointed as real property appraiser or assessor in any national government entity or local government unit, unless he/she has satisfactorily passed the licensure examination given by the Board, except as otherwise provided in this Act, and is a holder of a valid certificate of registration and professional identification card or a valid special/temporary permit duly issued to him/her by the Board and the Commission, and in the case of real estate brokers and private appraisers, they have paid the required bond as hereto provided.

SEC. 30. Positions in Government Requiring the Services of Registered and Licensed Real Estate Service Practitioners

Within three (3) years from the effectivity of this Act, all existing and proposed positions in the local and national governments, whether career, permanent temporary or contractual, and primarily requiring the services of a real estate service practitioner, shall be filled only by registered and licensed real estate service practitioners.

All incumbent assessors holding permanent appointments shall continue to perform their functions without need for reappointment and without diminution of status, rank and salary grade, and shall enjoy security of tenure. However, they may not be promoted to a higher position until they meet the qualification requirements of that higher position as herein prescribed. Nothing in this Act shall be construed to reduce any benefit, interest, or right enjoyed by the incumbents at the time of the enactment of this Act. The appointing authority shall exercise his power to appoint the assessor in accordance with the provisions of this Act only when a vacancy occurs.

SEC. 31 Supervision of Real Estate Salespersons

For real estate salespersons, no examination shall be given, but they shall be accredited by the Board: Provided, That they have completed at least two (2) years of college and have undergone training and seminars in real estate brokerage, as may be required by the Board.

Real Estate salespersons shall be under the direct supervision and accountability of a real estate broker. As such, they cannot by themselves be signatories to a written agreement involving a real estate transaction unless the real estate broker who has direct supervision and accountability over them is also signatory thereto.

No real estate salesperson, either directly or indirectly, can negotiate, mediate or transact any real estate transaction for and in behalf of a real estate broker without first securing an authorized accreditation as real estate salesperson for the real estate broker as prescribed by the Board.

A real estate broker shall be guilty of violating this Act for employing or utilizing the services of a real estate salesperson when he/she has not secured the required accreditation from the Board prior to such employment.

No salesperson shall be entitled to receive or demand a fee, commission or compensation of any kind from any person, other than the duly licensed real estate broker who has direct control and supervision over him, for any service rendered or work done by such salesperson in any real estate transaction. No violation of this provision shall be cause for revocation or suspension of the certificate of registration of the real estate broker unless there was actual knowledge of such violation or the broker retains the benefits, profits or proceeds of a transaction wrongfully negotiated by the salesperson.

SEC. 32. Corporate Practice of Real Estate Service

(A) No partnership or corporation shall engage in the business of real estate service practice unless it is duly registered with the Securities and Exchange Commission (SEC), and the persons authorized to act for the partnership or corporation are all duly registered and licensed brokers, appraisers or consultants, as the case may be. The partnership or corporation shall regularly submit a list of its real estate service practitioners to the Commission and to SEC as part of its annual reportorial requirements. There shall be at least one (1) licensed real estate broker for every twenty (20) accredited salespersons.

(B) Divisions or departments of partnership and corporation engaged in marketing or selling any real estate development project in the regular course of business must be headed by full-time registered and licensed real estate brokers.

C) Branch offices of real estate brokers, appraisers or consultants must be manned by a duly licensed real estate broker, appraiser or consultant as the case may be.

In case of resignation or termination from employment of a real estate service practitioner, the same shall be reported by the employer to the Board within a period not to exceed fifteen (15) days from the date of effectivity of the resignation or termination.

Subject to the provisions of the Labor Code, a corporation or partnership may hire the services of registered and licensed real estate brokers, appraisers or consultants on commission basis to perform real estate services and the latter shall be deemed independent contractors and not employees of such corporations.

SEC. 33. Display of License in the Place of Business

Every registered and licensed real estate service practitioner shall establish and maintain a principal place of business and such other branch offices as may be necessary, and shall conspicuously display therein the original and/or certified true copies of his/her certificate of registration as well as the certificates of registration of all the real estate service practitioners employed in such office.

SEC. 34. Accreditation and Integration of Real Estate Service Associations

All real estate service associations shall be integrated into one (1) national organization, which shall be recognized by the Board, subject to the approval of the Commission, as the only accredited and integrated professional organization of real estate service practitioners [AIPORESP].

A real estate service practitioner duly registered with the Board shall automatically become a member of the accredited and integrated professional organization of real estate service practitioners [AIPORESP], and shall receive the benefits and privileges appurtenant thereto.

Membership in the accredited and integrated professional organization of real estate service practitioners [AIPORESP] shall not be a bar to membership in other association of real estate service practitioners.

SEC. 35. Code of Ethics and Responsibilities for Real Estate Service Practitioners

The Board shall adopt and promulgate the Code of Ethics and Responsibilities for real estate service practitioners which shall be prescribed and issued by the accredited and integrated professional organization of real estate service practitioners [AIPORESP].

SEC. 36. Continuing Professional Education (CPE) Program

The Board shall develop, prescribe and promulgate guidelines on CPE upon consultation with the accredited and integrated professional organization of real estate service practitioners [AIPORESP], affiliated association of real estate service practitioners and other concerned sectors, and in accordance with such policies as may have been prescribed by the Board, subject to the approval of the Commission. The Board shall create a CPE Council that shall be composed of a chairperson coming from the Board, a member from the accredited and integrated professional organization of real estate service practitioners [AIPORESP] and a member from the academe.

SEC. 37. Enforcement Assistance to the Board

The Board shall be assisted by the Commission in carrying out the provisions of this Act and its implementing rules and regulations and other policies. The lawyers of the Commission shall act as prosecutors against illegal practitioners and other violators of this Act and its rules. The duly constituted authorities of the government shall likewise assist the Board and the Commission in enforcing the provisions of this Act and its rules.

SEC. 38. Indication of the Certificate of Registration, Professional Identification Card Number, and Privilege Tax Receipt (PTR) Number, and Accredited Professional Organization (APO) Number

Real Estate service practitioners shall be required to indicate the certificate of registration, professional identification card, Professional Tax (PTR) Number, and APO receipt number, and the date of issuance and the duration of validity on the documents he/she signs, uses or issues in connection with the practice of his/her profession.

ARTICLE V. PENAL AND FINAL PROVISIONS

SEC. 39. Penal Provisions

Any violation of this Act, including violations of implementing rules and regulations, shall be meted the penalty of a fine of not less than One hundred thousand pesos (P100,000.00) or imprisonment of not less than two (2) years, or both such fine and imprisonment upon the discretion of the court. In case the violation is committed by an unlicensed real estate service practitioner, the penalty shall be double the aforesaid fine and imprisonment.

In case the violation is committed by a partnership, corporation, association or any other juridical person, the partner, president, director or manager who has committed or consented to or knowingly tolerated such violation shall be held directly liable and responsible for the acts as principal or as a co-principal with the other participants, if any.

SEC. 40. Appropriations

The chairperson of the Professional Regulation Commission shall immediately include in the Commission’s programs the implementation of this Act, the funding of which shall be included in the annual General Appropriation Act and thereafter.

SEC. 41. Transitory Provisions

Within ninety (90) days from the effectivity of this Act, the DTI shall transfer all pertinent records, documents and other materials to the Professional Regulatory Board of Real Estate Service.

SEC. 42. Implementing Rules and Regulations

Within six (6) months after the effectivity of this Act, the Commission, together with the Board and the accredited and integrated professional association of real estate service practitioners [AIPORESP] and the CHED, shall prepare the necessary rules and regulations, including the Code of Ethics and Responsibilities for real estate service practitioners, needed to implement the provisions of this Act.

SEC. 43. Separability Clause

If any clause, sentence, paragraph or part of this Act shall be declared unconstitutional or invalid, such judgment shall not affect, invalidate or impair any other part of this Act.

SEC. 44. Repealing Clause

Sections 3(e) and (ee) of Act No 2728, as amended by Act No 3715 and Act No 3969, Sections 472 and 473 of the Local Government Code of 1991 (RA 7160), and pertinent provisions of the Civil Service Law are hereby modified accordingly.
All laws, decrees, executive orders, memorandum orders and other administrative issuance or parts thereof which are inconsistent with the provisions of this Act are hereby modified, superseded or repealed accordingly.

SEC. 45. Effectivity

This Act shall take effect fifteen (15) days following its publication in the Official Gazette or in a major daily newspaper of general circulation in the Philippines.

APPROVED.

Signed by:

PROSPERO NOGRALES, Speaker of the House of Representatives
JUAN PONCE ENRILE, President of the Senate

This Act which is a consolidation of Senate Bill No 2963 and House Bill No.3514 was finally passed by the Senate and the House of Representatives on May, 12, 2009.

Signed:

MARYLYN B. BARUA-YAP, Secretary General of the House of Representatives
EMMA LIRIO REYES, Secretary of the Senate

Approved: JUNE 29, 2009
Signed:GLORIA MACAPAGAL-ARROYO, President of the Philippines

If there is anything else important that I forgot to include in this article, please email me. If you want to comment about this article, there is a provision for this purpose that you can find below. Thank you so much for visiting my site. May God Bless You!

Terminologies in Real Estate Service - Part 3 of 3

[Basic Knowledge for Brokers]

This is a collection of Terminologies widely used in the Real Estate Service. If there is something I missed, please inform me. Thank you.

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IN-HOUSE FINANCING- also known as VENDOR FINANCING, is a real estate buying at installment basis wherein the mortgage agreement is between the property developer and the buyer. When the buyer fails to fulfill the obligation to pay, the ownership of the property reverts back to the developer. In-house financing usually have higher interest rates compared to bank loan. What is bad in in-house financing is that the seller only issues a Contract-to-Sell. In Bank Financing, the seller issues an Absolute Deed of Sale to the name of the buyer, and then automatically mortgage the property to the bank.

KEY LOT – A lot adjoining a corner, at right angle to it and fronting an intersecting street. (Commonly referred to as a “Tumbok” Lot)

LATCHES – Delay or negligence in asserting one’s legal right

LIEN – A hold or claim which one person has upon a property of another as security for a debt or charge, judgments, mortgages

LIS PENDENS – An annotation in the title which serves as notice that the property is subject to a pending litigation. Lis pendens is Latin for "suit pending."This may refer to any pending lawsuit or to a specific situation with a public notice of litigation that has been recorded in the same location where the title of real property has been recorded.

LISTING – The broker’s “stock in trade” or the property being handled by the broker: it can be referred to also as the contract between the owner and broker: or the authority of the broker to negotiate the transaction of a property for a commission.

MASTER DEED – A document executed by a property owner which creates or converts his properly into a condominium pursuant to Rep. Act. 4726

MECHANICS LIEN – A lien created by law which exists in favor of persons who have performed or furnished materials in the erection or repair of a building

METES AND BOUNDS – Measurements and boundaries. A term used in describing the boundary lines of land, setting forth all the boundary lines, together with their terminal points and angles.

MULTIPLE LISTING – an arrangement among a group of real estate brokers to share its listings with a pre-arrange agreement especially on commission sharing

OBSOLESCENCE – Impairment of desirability and usefulness brought by physical, economic, functional deterioration, or other causes. Loss in value due to reduced desirability and usefulness of a structure because its design and construction becomes obsolete; loss because of becoming old-fashioned and not in keeping with modern needs with consequent loss of income.

OPEN MORTGAGE – A mortgage which can be paid off at any time even before its maturity.

OPEN-END MORTGAGE – A mortgage containing a clause which permits the mortgagor to borrow additional money after the loan has been reduced, without re-writing the mortgage

OPTION – The right to purchase or lease a property at a certain price for a certain designated period, for which right a consideration is paid

OPTION MONEY – The amount paid to a property owner in consideration of giving a prospective buyer or lessee the exclusive right to buy or lease his property within a specified period at the agreed price and term. (Within the option period, the owner cannot sell or lease except to the person who paid the option money).

ORDINARY ASSET - Ordinary asset refers to all properties specifically excluded from the definition of capital assets under Sec. 39 (A)(1) of the NIRC.

OVER-IMPROVEMENT – The improvement which does not produce an adequate return for the amount invested on a building or property. An improvement which is not suitable to the site on which it is placed due to excessive size or cost.

PACTO DE RETRO SALE – A contract of sale with the stipulation that the vendor shall have the right to buy back the property within the agreed period

PACTUM COMMISSORIUM – A stipulation which authorizes the mortgagee to appropriate the property as his own upon failure of the debtor to fulfill the principal obligation

PACTUM DE NON ALIENDO – A stipulation which prohibits the mortgagor from alienating the property within the period of the mortgage

PARAPHERNAL LEASE – Property exclusively owned by the wife

PENRO -- Provincial Environment and Natural Resources Officer of the DENR

PERCENTAGE LEASE – A lease of a property in which the rental is based upon the volume of sales made upon the leased property

POLICE POWER – The right of the state to enact laws and enforce them for the order, safety, health, morals and general welfare of the public

PRINCIPAL – A principal is commonly known as the person who engages the agent for representation.

PROBATE – The proof or act of proving at a court that a last will and testament is actually that of the deceased person

PROCURING CAUSE – The act of a broker leading to the meeting of minds between the parties to a transaction or the consummation of a transaction.

PUT OPTION – This is a contract that authorizes a Broker to offer a property for sale at a premium profiteering price, which is normally a high price above the normal fair market value. When a real estate owner wants to sell his property that is currently under a Professional Real Estate Management Service (PREMS), he will just order a Put Option to the Broker.

QUITCLAIM – A deed of release or renunciation of a legal right. A deed to relinquish any interest in property which the grantor may have had an protest or adverse claim.

RATIFICATION -- Ratification is one way of how an agency relationship is created. It means that if a person having no authority whatsoever purports to act as an agent and the purported principal later adopts the acts of that agent, an agency relationship has retroactively been created.

REAL ESTATE - refers to the land and all those items which are attached to the land. It is the physical, tangible entity which can be seen and touched, together with all the addition on, above or below the ground.

REAL ESTATE DEVELOPMENT PROJECT - means the development of land for residential, commercial, industrial, agricultural, institutional and recreational purposes, or any combination of such including, but not limited to, tourist, resorts, reclamation projects, building or housing projects, whether for individual or condominium ownership, memorial parks and others of similar nature.

REAL PROPERY - includes all the rights and benefits related to the ownership of real estate.

REAL ESTATE SERVICE PRACTITIONERS - shall refer to and shall consist of Real Estate Salesperson, Real Estate Broker, Real Estate Appraiser, and Real Estate Consultant. :

RED - Regional Executive Director of DENR

REIT - Real Estate Investment Trust

RESA - Real Estate Service Act (R.A. No. 9646)

SALESPERSON – a Real Estate Salesperson is a duly accredited natural person who performs service for, and in behalf of, a real estate broker who is registered and licensed by the Professional Regulatory Board of Real Estate Service for or in expectation of a share in the commission, professional fee, compensation or other valuable consideration.

TACITA RECONDUCTA – It means that if at the end of the period of lease, the lessee continues to enjoy the thing leased with the acquiescence of the lessor, it is understood that there is an implied new lease.

TIE LINE -- is an imaginary line connecting from the known geographic position (tie point) to the corner of the titled property. This term is used in Map Reading.

TIE POINT -- is a reference point with known geographic position established by the Bureau of Lands. This term is used in Map Reading.

UNDER IMPROVEMENTS – That improvement which does not sufficiently improve the land to product he highest and best value of return of which the land is capable.

UNEARNED INCREMENT – A value added to land for which the owner is in no way responsible, like the increase of population

VALUE IN EXCHANGE – Objective Value. Property’s value to an impartial buyer who represent the market.

VALUE IN USE – Subjective Value. The property’s value to its occupants or users.

WARRANTY DEED – A deed used to convey real property which contains warranties of title and quiet possessions. In a warranty deed, the grantor is to defend the premises against the lawful claims of the third person.

WRIT OF EXECUTION – A writ authorizes and directs the proper officer of the court, usually the sheriff to carry into effect a judgment or decree of the court.

ZONING ORDINANCE – The exercise of police power by the municipality or city and regulating and controlling the character and use of property .

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