Showing posts with label Tips for Property Owners. Show all posts
Showing posts with label Tips for Property Owners. Show all posts

2/28/2014

Tax on Rent Income

Income from rent is categorized under passive income and is therefore subject to 20% tax. As BIR becomes aggressive on taxing passive income, even to the point of checking the bank accounts of people, rents nationwide will surely increase. Heads up: massive inflation is inevitable.

Think about this. Real estate lease agents only take 8% commission, while BIR takes 20% tax. Ridiculous.


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!

6/10/2013

How combustible methane could accumulate a condo unit



This has relation to the Serendra gas explosion that I explained in my blog yesterday. In my opinion, it was not LPG, but sewerage methane that exploded. The image below (left side) was taken from a condominium in Makati after the renovated. The image at the right was taken after I made corrections. The left photo shows how methane could enter the condo unit as a result of lousy plumbing job under the lavatory. It also shows the correction that needs to be done. So, look under your lavatory and sink and check it out if you see something like it and have it corrected, or else take the risk of gas fire, explosion, suffocation, or poisoning. What goes down from the units to the septic tank is not methane, but what goes up is a pure combustible methane that can explode when ignited.



In my opinion, the Serendra Blast was not LPG. All wastes from your toilet, lavatory, and sink goes down through pipes and down to the septic tank. Septic tank produces methane gas and it also goes up through the pipes and will enter your unit if the plumbing in your unit was lousy like the one you see in my actual pictures.

Now you see, colorum (unlicensed) real estate practitioners like agents, interior designers, engineers, plumbers, electicians -- DAMN THESE ARE DANGEROUS. I advocate the eradication and law enforcement against colorum, but the Philippine Government does not care, media does not care, real estate developers does not care -- as they say: IT'S MORE FUN IN THE PHILIPPINES.

I've been a licensed real estate broker since 1998. Not so long ago, Mar was chief of Dept of Trade and Industry, under this agency is the Bureau of Trade Regulations and Consumer Protection (BTRCP). Most real estate services require licensing in BTRCP. It was during his time as DTI chief when colorum real estate practitioners grew in exponential proportion, and their number have already reach a point that it is very difficult to eradicate. You see now, Mar handled the investigation of the Serendra blast but never looked at the angle that unlicensed real estate practitioners who did the piping installation, renovation, inspection, and leasing agency could possibly be the reason of the explosion. If I were a real estate tycoon and I need a whitewash, I would call on the right guy.

There are only three sets of persons who can be held liable: (1) the leasing agent, (2) the building administrator/engineer, (3) the renovation contractor. First, find out if these persons are LICENSED in the practice of the profession. The tenant and unit owner cannot be held liable because they are mere end-users or consumers of these real estate services.

My advice to the Condo Homeowners Association is straightforward. You are the last line of an organized defense. Protect your selves and your families. Make sure that people doing services in your condominium are LICENSED. I am talking about brokers, leasing agents, property managers, renovation contractors, building administrators, plumbers, building engineers, and electricians. Make sure they are licensed. The Homeowners Association must not allow themselves to be over-powered by the influence of the Developer because these Developer are fond of using colorum for cheaper labor cost and exploitable services. As members of the homeowners association, the bottom line is, you are the end-users and end-consumers and you need to protect yourselves. If your developer and real estate agents did not disclose that your building is sitting on top of the fault line, it is time you discuss it as a community and come up with plans. Don't be victims.

QUESTION: So this scenario is also applicable to houses. if the Serendra has a U-Pipe, then what causes the explosion is LPG?

ANSWER: Yes. This anomaly i can be in condo units and also house. The Serendra Blast investigators did not know what to look for. They did not have this theory until I exposed it here. I was wanting to investigate what is left of the explosion. I will be looking in particular for that pipe under the lavatory and the sink. But I don't think it is possible now, especially if they wanted to white-wash it and push the LPG theory down our throat.

You know, modern centralized LPG piping systems (if ever it is functional in Serendra) have auto shut-off mechanism -- continuous leak is almost impossible. They have to tell this technological feature of the Serendra fittings. I was surprised they didn't.

QUESTION: Is this scenario visible by the naked eye by just quickly looking at the lavatory or sink?

ANSWER: No it is not, especially if your there is a drawer type cabinet under your lavatory or sink. This anomaly is very common in drawer type space saver cabinet under lavatory. You have to crawl down and look for it down there. See this picture below.



QUESTION: Sir John, is it possible to maliciously convert a condo unit into a bomb?

ANSWER: Yes. Very easy. Refer to image one above. Simply unscrew the plug at the bottom of the U-shape pipe to release the water that prevents the Methane from entering the room. Once you remove the water that served a natural barrier between your room and the septic tank, Methane will enter your room and the room will become a ready explosive in just an hour. The only thing that is lacking is a detonator, a park, an igniter, if you light a cigarette, BOOM. If you wanna die by suicide of Methane poisoning, simply unplug the cap, close your windows, turn off your exhaust, and sleep, you will never wake up the next day if you inhaled too much of it. You see, if you complain of being always sleepy while inside your condo unit, call me up for a Safety Inspection Service (it will not cost you that much), there might be something in there that you can't see. I have a gas detector professional gadget specially for that purpose.

QUESTION: Rltr. John, we are conducting professional consultation about the upcoming Congressional Bill that seeks to require all condominium units to be installed with Gas Detector Device, which will be implemented via LGU. What can you say about this?

ANSWER: The Republic Act 9514 of December 2008 (Revised Fire Code of the Philippines) is already a sufficient legislation. There is no need for a new law. Most buildings are already installed with smoke and fire alarms. The homeowners just have to UPGRADE technology and specifically use early warning devise that can detect various types of dangerous gas aside from smoke. Let the private sector sell the devise in various models and let the buyers choose -- there is no need to force the buyers to buy it from LGUs.



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!

5/30/2013

Condo assoc fee is not part of rent

QUESTION: Rltr. John, I am offering my condo unit for rent. I am confused on my asking price. Should the asking price include the condo homeowners association fees?

ANSWER: The condo homeowners association is not part of the rent and should not be part of the asking price when you offer the unit for rent. The tenant, mandatory, pays it separately from the rent. The association fee is a payment for the tenant to enjoy the security, amenities, and janitorial services of the environment of the unit. Let me say it in simple logic. Only your unit is for rent. You cannot rent out the common areas. You cannot make money in renting out the common areas. So, that's why assoc fees are not part of the asking rent. Okay?


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!

5/25/2013

Many Listing or Few Listing?

QUESTION: Rltr. Petalcorin, I want to sell my house in Alabang and use the money to buy a Condo near my hospital in Makati. I want to know your advise on which is the better Broker who can help me -- (a) a Sales Agent with many properties to sell, or (b) the one with fewer properties to sell?

ANSWER: When you sell your property, get a Seller's Agent who has a Real Estate professional license (Broker or Salesperson) certified by PRC. The probably better Seller's Agent is one who has FEWER properties to sell because it means there is a higher chance that your property will get more time from the Agent. Of course this theory is not ALWAYS true.

When you buy a property, get an Exclusive Buyer's Agent to professionally represent you in purchasing.


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!

2/02/2013

Homestead Titles in Bangsamoro Land

In the past, there were no cadastral surveys and land titles. However, there were already conveyances such as sale, lease, dowry (wedding gift to the bride),diyah (blood money), inheritance, and royalty gratuities.

The Sultanate of Sulu owns the Spratleys. In 1417, the heirs of Sultan Paduka Pahala already gave it as gratuity gift to China after his death while on State Visit to China. It is the same manner of conveyance (though royal gratuity gift) as how Sabah, which was owned by Brunei, ended up in the ownership of the warriors of the Sultanate of Sulu.

The Bangsamoro People owns Mindanao, Sulu, Palawan, and Sabah and are fully aware that there are squatters (who were issued colonial land titles which later became Torrens Title and Homestead Titles). This is the root cause of the Bangsamoro War that is still ongoing.


Now I will give you a brief assignment to talk to your relatives who migrated to Mindanao so you will have a personal touch of this lesson. If your clan is originally from Visayas and Luzon, it is most likely that you have some relatives who transmigrated to Mindanao or Palawan between 1930s to 1970s. The transmigration was a result of the Homestead Program (HP).

The HP is a very simple anomaly. First, the colonizers (or colonizer-controlled Philippine President) issues land title (issued in Manila) to their cronies specifying large tracks of land areas in Mindanao even without inspecting who is residing and working on the land -- the output is a Homestead Title. Then the crony who received the Homestead Title will subdivide the land and sell it to those who avail of the Homestead Program. The cronies also have conflict against fellow cronies because the HP titles overlap with one another (naturally because the boundaries are roughly estimated only, there were no land survey made).

Ang mga local people na nakatira sa Mindanao and Palawan for centuries na eh nagulat na lang na merong dumadating na taga Ilocos (at iba pang lugar sa Luzon) na merong hawak na titulo ng lupa nila -- so nagkaroon ng conflict. The Philippine Government sends in the Army to supress the local people in favor of the beneficiaries of the Homestead Program who holds title.

The HP was very cruel. The local people were uprooted, massacred one family after the next, and most of them were pushed to the highlands and to the now ARMM areas. Now we have the Bangsamoro People and Bangsamoro War in the Philippines.

China will help the Bangsamoro People recover their NATION! This is the most exciting thing to watch in the coming years. The Moro National Liberation Front (MNLF) is the army of the Bangsamoro People (Mindanao, Sulu, Palawan, Sabah) and will soon recover Sabah from the Malaysian occupation.



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!

1/15/2013

Overpricing by agent is unethical

QUESTION: Rltr. John, I hired an agent to offer my vacant lot for sale at P6.5M. He advertised it in the classified ads at P7M, while all the other similar properties of the same size in the area are advertised at P6.5M. Did he do the right thing?

ANSWER: In my opinion, your agent violated the Code of Ethics of Real Estate Service if he did it without your consent. Section 3 paragraph (f) of the old Code of Ethics says your broker “should not advertise any property without authority and in any offering, the price quoted should be in accordance with the price agreed with the owners as the offering price”. Offering it for sale at overprice would make it less competitive in the eyes of the prospective buyers.


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!

1/14/2013

Which agent to choose?


QUESTION: Rltr. John, I am in a hurry to sell my property. There are many agents out there but I need your coaching in choosing the right one. Assuming you are in my shoes, what is your personal criteria of a highly-effective agent?
ANSWER: The keyword is Active. I would prefer a real estate Broker who have the following characteristics: (1) must be currently licensed in PRC; (2) must be an active practitioner, meaning, he must have a principal place of business (as required by RA 9646), own official receipt (as required by BIR), and essential communication equipment such as phone and internet; (3) must have the most number of active PRC-registered Salespersons who can help him in finding buyers; and (4) must be active in advertising in printed classified ads that has extensive reach and other internet-based classified ads.


1/11/2013

Commentary on "Calculating Return-On-Investment For Condo Units"

A foreign investor requested a comment about the blog titled "Calculating Return-On-Investment For Condo Units". Below is my comment.

COMMENTARY: The rent of 15,000 is too high for a 23 sqm condo unit -- it should only be around 12,000 including Association Monthly Dues. But if you insist on 15,000 then OK as on the assumption that it is fully furnished (interior renovation, fixtures and furnishing costs at least 400,000).

If the rent is above 12,800, please include 12% VAT, which will reduce your 15,000 desired income by P1,800.

That Monthly Association Dues of P1,150/mo is the cheapest I know, so probably I assume that is a class D condominium.

That calculation also assumes the unit owner does it all by herself in showing the unit to prospective tenants. Since we assume she is an "investor", we would assume she must be gainfully working overseas or a local hard working RICH with no time to show the unit -- in reality, an absentee owner will have to hire a Professional Property Management Service which will cost her professional fee of P20,000 (with or without tenant) a year plus 8% Commission on the income from rent.

A condo investor who earns 4% ROI/yr is the luckiest among a line-up of 100 randomly picked unit owners. Although I would say a 6% ROI is possible if the Property Manager will put your property favorably on top of the line-up. If you present an assumption of 2 months vacancy cost, you have to present it in such a way that you will not run a risk of giving the investor a false promise of a 10 month occupancy rate -- that occupancy rate is very difficult to achieve if you ask a seasoned tenant head-hunter who have done-this-done-that.

If that is a brand new condominium, the moment the buyer pays the first Property Tax (around P4,000) in City Hall, she will have to stare with surprise at the assessed value of less than P150,000 for that unit and begin thinking she probably got ripped-off when she bought it at P1,200,000.

Surprisingly, in the end if the investor would want to liquidate the investment, she will have to offer that unit for sale at a price lower than the acquisition cost. Of course she has to pay 5% broker's commission.

FINAL WORDS

My last words for the investors, hmmmmm, if you really want to try to gamble an investment with Philippine condo, try the cheapest chip first. A small studio-type unit is best for investment trial purposes. Unless you are filthy rich who burns thousands of money without remorse, never start a trial investment with anything bigger than a studio-type condo. If you want to be introduced to non-Filipinos who have actual experience as condo investor in Philippines, just ask and I will refer you so you can learn from their experience.

If your money is hard-earned, like that of OFWs, save your self some tears, and trust me, the agent who sold the unit to you will not be by your side when the promised return of investment will not materialize. The agent can't help you resell that because it will compete with the other brand new units of the developer she exclusively works for.

Remember, before the sale, seller's agents will be nice to you; but after the sale, they won't care at all. Investment Scam in Philippines is a means of survival and widely practiced. Seller's agents would do anything, promise you high return of investment, to make you sign that deal. If the seller's agent is in a hurry to make you sign the purchase, read first my blog titled, "Is now the right time to buy and invest?". Another thing to watch out before you sign a purchase is the Lease-Back and Buy-Back Scams, the anomaly of Non-Disclosure of Master Deed. There are many more loopholes that you need to watch out for, I have written them all in my blog, but if you don't have 14 years to go through my experience as a Broker, then just hire a Broker Property Manager to watch your back during investment acquisition and all throughout the leasing out of the unit after the acquisition.

Since you are an investor and I am just a pro bono real estate service coach. Let me wrap it up with a light-hearted game where I will surely win (so I will earn income). Come with me and let's gamble. I will bring to any mall you want in Metro Manila where I can show you an amazing large pool of real estate agents hanging around handing out condominium marketing fliers. You bet your P40,000 (that is equivalent to around 1,000 US Dollars). The game is simple. We walk in the mall and you randomly pick 10 agents and get their fliers. Then we sit down and I will show you a website where we can determine who is licensed and who is not. If we can't find one licensed real estate agent from the randomly selected ten agents, I win your P40,000. The relevance of the game is about letting you discover, at the ground level, how big the anomaly is in Philippines on consumer risk associated with unlicensed agents (cum real estate investment consultants as how they call themselves). Wanna bet?


Below is the assumption of the Investment Scam I commented upon: Calculating the ROI On Condo Units

Estimated cost of a 23 sqm unit of condo: P1,200,000

Estimated rental income per year (at Php15,000/month): P180,000

Less

Vacancy costs (2 months): P30,000

Monthly Dues (12mos at 1,150/mo): P13,800

Taxes: P5,500

Maintenance: P4,000

Insurance: P2,500

Net Income: P124,200

ROI = (Net Income / Total Cost of Unit) * 100

ROI : 10.35% per year or about 9 years & 8 months


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!

1/23/2012

VAT Exemption Threshold

Effective 01 January 2012, BIR rules Increased Threshold for VAT Exemption

The BIR has released Revenue Regulations (RR) No. 16-2011 dated October 27, 2011 which increased the threshold amounts for VAT on the sale of residential lots and house and lots, the lease of residential units, and the threshold amount for the sale of goods and services subject to VAT.

Effective January 1, 2012, the sale of a residential lot which is PHP1,919,500.00 and below (Current - PHP1,500,000 and below), and the sale of a residential house and lot which is PHP3,199,200.00 and below (Current - PHP2,500,000) are exempt from VAT.

The lease of a residential units which is PHP12,800 and below (Current PHP10,000) shall also be exempt from VAT effective January 1, 2012.

If a person's gross annual receipts/sales on the sale or lease of goods or properties or performance of services other than those mentioned in Sec. 109 of the Tax Code does not exceed PHP1,919,500.00, (Current - PHP1,500,000) he shall be subject to 3% percentage tax instead of the 12% VAT.


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!

4/25/2011

For Sale by Owner (FSBO)

QUESTION: Good Day Sir! We are planning to sell our house and want to get an Agent to sell our house in our behalf. I just want to ask the standard rate commission to be given to the Agent?

ANSWER: Preset 2.5% to the Advertising Agent and 2.5% to the Buyer Agent. But the best is to sell it fast by offering it at competitive price by avoiding the Agent -- you may use FSBO.

FSBO means "For Sale by Owner". There are many FSBO Listing sites in the Internet. Properties posted in FSBO are assumed to be AT LEAST 5% cheaper than those you can find in Listings operated by brokers because FSBOs have no agent commission and have no overprice. This makes FSBO attractive to buyers.

10/31/2010

Household Safety Tips - PNP

The PNP Crime Prevention and Safety Tips is a highly recommended reading
material that each family should take time to discuss together in one
sitting.

URL: http://www.pnp.gov.ph/main/index.php?option=com_content&view=article&id=75&Itemid=95

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The Philippine National Police is dedicated to ensuring public safety and reducing the fear and the incidence of crime in the country. But there are many things each and every person can do to reduce his or her chances of becoming a victim or prevent crime from happening. Below are crime prevention tips for your home, your business, yourself and your family. We urge you to familiarize yourself with the information contained in this section and to make crime prevention, awareness and education a part of your everyday life.

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HOUSEHOLD SAFETY TIPS

* Make it a habit to inform members or housemates on your where about. Know also the places where your love ones frequently go. Know their friends and the people they usually go out with.
* Conduct a thorough background check on any person you are hiring as driver, household help, baby sitter, gardener or security guard. Require them to secure clearances from the police, NBI, and the barangay.
* In answering the phone, do not divulge your name and important information to strangers. Always take down the names of callers and their messages including the date and time of their calls.
* If you are a woman and live alone, list only your first initial and last name on the mailbox, or in the telephone directory.
* Never let strangers into your home to use the telephone. Make the call for them while they wait outside.
* If you receive a wrong number phone call, don’t give out your name or phone number.
* If you receive an obscene phone call, hang up and call the police.
* Be alert and aware of your surroundings before opening the gate or the door. If possible, use a safety latch on the door. Immediately report any suspicious person or vehicle seen in the vicinity. Beware of people befriending your household help or who are asking too many questions about those in the house.
* When arriving home by private or public conveyance like a taxi, ask the driver to wait until you are safety inside.
* Have the door key in your hand so you can open the door immediately when you return home.
* Know who is at your door before opening it. Wide angle door viewers (180 degrees or 190 degrees) enable you to identify the visitor. You can see the person, but that person can’t see you.
* Never rely on chain locks. They are only a private lock, not a security lock.
* Never let anyone into your home without proper identification. Don’t be afraid to ask for identification.
* When moving in to a new apartment or residence, always have the locks re-keyed, or changed.
* Never dress in front of windows. Always close the drapes when doing so.
* If you suspect anyone is in your house. Do not go in. Go to a neighbor and call the police.
* Always leave outside lights on after dark, or use motion lights.
* List important information, like serial numbers of appliances in the house. This will aid in the recovery of stolen items.
* Secure valuables, like money, jewelry, and important documents in a safe to protect them from robbery or fire.
* Avoid displaying valuable things in the backyard to prevent any break-in. Keep them out of sight and out of reach from the outside.
* Use widow curtains to prevent people from seeing the inside of the house.
* Unplug all electrical appliances before leaving the house or better yet, turn off the main fuse to prevent electrical fire.
* Entrust your house only to people you absolutely trust or ask relatives to remain in your house until you return.
* Post a list near the telephone containing emergency numbers of the Police Station, Fire Station, and Barangay headquarters in your locality.
* If you see or hear anything suspicious, call the police.

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SAFETY TIPS FOR CHILDREN

* Instruct children not to stay outdoors without the company of parents or guardians to avoid being victim of abduction.
* If your children have to go out with other companions, know the identities of their companions and the address and telephone number of the place they are going to. Know the background of your children’s fried.
* Warn children not to talk or receive anything from strangers. If such strangers are persistent, advice children to shout, run, and immediately inform their parents, relatives, or authorities such as teachers, security guards or police.
* Always coordinate with the school regarding the security of the children. Inform the school authorities that they are prohibited from divulging any information about your children and giving away their pictures without your permission.
* Inform the school on who is authorized to fetch your child. This arrangement must not be violated until you yourself give word of any change In the arrangement.
* In crowd places such as malls, keep your children close to you and keep an eye on them at all times. Children are prone to wander off.
* Warn teenage children, especially females, against smooth-talking and dubious characters who may have criminal’s intentions or who are bad influences or appear to be bad influences.

REMEMBER: Children are easy prey to crimes because of their innocence. Parents and guardians must exert efforts to ensure their safety.

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SAFETY MEASURES IN THE STREETS

* Secure your wallet. Do not place it in a loose pocket such as the jacket pocket.
* Do not carry large amounts of money or wear expensive jewelry when riding in a public transport such as bus, jeepney or taxi.
* Pass through secured and well-lighted walkways. Avoid dark shortcuts and tight spots. Familiarize yourself with the vicinity. If you noticed that someone is intentionally following you, immediately seek refuge in a building with a security guard.
* Walk on the sidewalk opposite the flow of traffic in order to see any vehicle coming towards your way.
* Use caution in parking lots and those areas near shrubs or with shrubs.
* Be ready with the key to the gate or door so that you won’t stay too long outside the gate.
* Don’t accept rides from strangers, and don’t respond to comments from strangers on the streets.
* Don’t hitchhike. If someone suspicious is following you, cross the street and walk into an open business area.
* Watch your surrounding and be alert for suspicious persons, especially around banks, stores, streets, and in your cars or homes.
* Be calm and maintain presence of mind if a crime is being committed in your midst. Remember the appearance of the criminal and noticeable details such as tattoos, color of the hair and speech irregularities. They will aid the police in his capture.
* Do not attempt to argue with or fight off armed criminals. They are dangerous and maybe mentally and emotionally unstable. Be calm in speaking to them.
* When riding a taxi especially at night, write down important identifying details such as plate numbers, body markings, color of the taxi. Even the time and place when and where you boarded the taxi.
* When riding alone in taxi, always be at the rear seat of the vehicle.
* Stay alert against snatchers when walking or when aboard any public transports especially when seated near the widow or entrance of the vehicle. Avoid using your cellphone while walking to prevent being a victim of snatching.
* If you are going to be out late, make sure you have a cab fare.
* If someone in the bus bothers you, change seats and tell the operator.
* If you ride with another person, sit near the control panel, and if attacked, press as many of the control buttons as possible.
* Have your fare or pass ready in hand when boarding the bus.
* At night, avoid dark and isolated intersections or stops.
* Look around when getting off the bus or trolley, and be aware of people around you.

REMEMBER: People who are easily victimized on the streets are those who are careless and are unaware of their surroundings.

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PREVENTION AGAINST CARNAPPING ANG CARJACKING

* Install a warning alarm on your vehicle.
* Do not leave valuables inside the vehicle.
* Never pick up hitchhikers.
* Don’t park in the dark.
* Never leave keys in the car.
* Use safety locks or child-locks on the doors or windows of your vehicle at all times to prevent any criminal from entering your vehicle especially when you are stuck in the traffic.
* Never allow an unknown vehicle follow you home.
* If your vehicle breaks down in an unsafe place at night, especially if you are a female, stay inside your vehicle, lock all doors and windows and use your cell phone to call for help.
* When walking to your car, have your keys in your hand so you can open the car door without delay.
* Always keep your car in gear when stopped at a traffic signal or stop sign, so that if threatened in any way, you can quickly drive away.
* Always check the backseat of your car before getting in.
* If a person at the roadside is waving for help due perhaps to a flat tire or engine trouble, drive past that person and stop at a safe distance before using your phone to call for help or seek help from the police or highway patrol.
* Always lock your door while driving.
* Do not trust watch-your-car boys when you park outside building. They may be serving as spotters or look-outs for car thieves.
* Always prearrange meetings with anyone so you do not have to wait alone.
* Immediately change your ignition switch in case you lose the ignition key of your vehicle.
* Do not allow your driver to sleep inside your vehicle while waiting for you. They are easy targets of armed car thieves.
* Do not leave your parking ticket inside the vehicle.

REMEMBER: Highly skilled car thieves can easily steal or break into cars. Be security-conscious all the time.

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PREVENTING SEX CRIMES

* Avoid wearing sexually suggestive clothing.
* Do not accept free rides from strangers.
* Avoid being in an elevator with a stranger.
* Be alert against rapist. Move fast and use any defense tactics such as scratching the face, kicking the groin, biting or simply shouting.
* If the rapist is too strong to overcome or he is armed or he is with group, reason with him or convince him that you have infectious disease such as Hepatitis B or AIDS.
* Avoid walking along crime-prone streets especially when alone. These streets are usually situated near places of ill-repute.
* If an attacker flees, continue shouting and creating commotion until you find refuge and help.
* Go home early. But if you cannot avoid going on overtime, it is better to wait for sunrise before going home. If you really have to go home, ask the security guard or anyone you know to walk you to your car or take down the number of your taxi cab, should you decide to ride in one.
* If you are alone at work after business or office hours, keep your doors locked.
* It is never a good idea to go to a nightclub alone.
* Do not allow alcohol or drugs to impair your judgment. If you haven’t already set social standards, do so and stick to them. Do not allow an overly aggressive pursuer to change your mind.

REMEMBER: Alertness and presence of mind will ward off.

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PREVENTING KIDNAPPING

* If you and your family are possible targets of kidnapping, avoid falling into predictable routines such as travel routes to and from the office, and departure and arrival schedules.
* Instruct companion in the house, officemates or colleagues not to give away information about you and your daily routines.
* Avoid stating your identity in ads posted when selling a large property. This attracts unnecessary attention to your wealth.
* Avoid a lifestyle of excess; this invites danger for you and your family.
* Know your neighbors and communicate with them frequently. They can inform you of suspicious people who are asking questions about you and your family.
* Be conscious of suspicious vehicles that may be tailing you.
* Remember the procedures in case kidnappers block your vehicle. Your correct immediate reaction and audacity can save you against kidnappers.

REMEMBER: Secure your wealth, otherwise it will invite harm.

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AVOID BEING VICTIMS OF CYBERCRIMES AND ILLEGAL RECRUITMENT

* Beware of “get-rich-quick” promos in the internet or through text messages claiming that you have been randomly selected as the winner of a raffle or sweepstakes draw. These are usually scams or practical jokes even if they claim to have DTI permits.
* Do not fall for internet messages claiming that you have been made a beneficiary of the money of rich people from other countries such as Nigeria. These are schemes of transnational crime syndicates.
* Do not accept any package or parcel from the mail or delivery services if you do not know the source; it may contain illegal materials, contrabands or drugs.
* Refuse any request to handcarry packages from other people you know. You will surely land in jail if such packages contain illegal substances.
* Be on guard against illegal recruiters for jobs abroad. Check first with the Philippine Overseas Employment Agency (POEA) if the recruitment agency is legal. Further, confirm if there is a job order. Legal placement Fees must not exceed a month’s wages.
* Do not give out important information such as ATM count numbers, e-mail passwords or credits card numbers on the internet or to a call center representative.
* Avoid communicating with strangers in chat rooms recruiting you for clandestine internet business. You may end up a victim of cyber-sex or human trafficking syndicates.

REMEMBER: Gullible people are targets of Cyber-criminals and illegal recruiters.

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IF YOU ARE ATTACKED ALWAYS REMEMBER

* Use common sense. Try to talk your way out of it.
* Try to negotiate.
* Stall for time.
* Be verbally assertive.
* Distract or divert the assailant, then flee. Run toward an open business are or towards a public place where is a group of people. Hide if you can get the opportunity.
* Scream as loud as possible, and keep it up to attract attention and help from people nearby.
* During an armed attack, you must decide the proper course of action.
* There is no hard and fast rule as to self-defense. You must consider your physical capabilities, your location, and your perceived chances of success. If you cannot escape, bide for time and look for another opportunity. A half-hearted attempt could be worse than no attempt at all.
* Notify the police immediately when you get the opportunity. And if there are witnesses, ask them to stay until the police arrive.
* It is not advisable to carry guns, clubs, knives, or chemical sprays. It is illegal to carry some of these weapons, and they could be used against you. It is advisable not to carry weapons.
* And finally, if a crime occurs, report it. When you report a crime and all the facts about it, it helps the police to assign the officers in the places where crimes are occurring or where they are most likely to occur. If you don’t report a crime, this allows the criminal to operate without interferences. Tell the police what you know. No fact is too trivial.

8/14/2010

How to Eradicate Garapata

QUESTION: Sir John, our house pet dogs have GARAPATA. How do I get rid of these pests for good?

ANSWER: It's been years our two dogs don't have pulgas or garapata. I use BAYER Dog Soap (blue package). By the way, don't kill the garapata with hammer, their eggs will survive. Use a small medicine bottle and put in it some two teaspoons of BAYGON, and drop the garapata in there.

8/05/2010

It's unethical for agents to overprice

QUESTION: Sir John, I commissioned a licensed Real Estate Broker to offer my vacant lot for sale at P6.5M. He advertised it in the classified ads at P7M negotiable, while all the other similar properties of the same size in the area are advertised at P6.5. Did my broker do anything unfair to me?

ANSWER: Definitely YES. Your Broker violated the Code of Ethics.

Section 3 paragraph (f) of the Code of Ethics says he (your broker) should not advertise any property without authority and in any offering, the price quoted should be in accordance with the price agreed with the owners as the offering price.

Moreover, the advertisement would also be useless because your property would become less competitive in the eyes of the prospective buyers.

8/04/2010

Study the best use of your land

QUESTION: Sir John, I am a Doctor of Medicine. I have accumulated a number of residential land. They are all idle as of today. I want to start getting the best value for these lands. Am I going to sell it or what is your advice? ANSWER: Find a licensed Real Estate Broker and commission him/her to visit the properties, make a determination, and write a report about the best possible use of those lands.

You can either sell it, lease it, build an apartment on it, exchange it, or have it developed by a REIT Corporation under a joint venture agreement. It is better if a professional broker sees it first.

Section 3, Paragraph 4 of the R.A. No. 9646 defines the 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.

QUESTION: How much will the Broker charge on workload like this?

ANSWER: He will charge you Professional Fee to cover the whole day work plus travel expense if the property is out of town. A seasoned Broker like me would charge you Professional Fee of P3,000 per property, it includes the visitation and writing of report, but excludes the travel expense.

8/03/2010

Adverse Possession

QUESTION: Sir John, my family has been occupying a piece of farm land NOT our own in Mindanao for 36 years already. My dad knows who the owner is because we have a copy of the Spanish Title but we don't know where they are. Can we have it titled in our name?

ANSWER: Yes. Your dad can file for an ADVERSE POSSESSION.


ADVERSE POSSESSION is the Right of an occupant of land to acquire title against the real estate owner, where possession has been actual, continuous, hostile, visible, distinct and in the concept of owner for the statutory period. (Note: Statutory period is 30 years: adverse possession does not apply on lands titled under the Torrens System).

QUESTION: Can we sell this Right of Adverse Possession to someone else?

ANSWER: Your right is classified as the right to claim. You can sell it after you get a title under your name. But if you sell it to someone before you get a title under your name, the buyer will surely have a hard time claiming the right of adverse possession because he cannot meet the required minimum 30 years of length of occupancy of the land.

7/27/2010

Best solution to problematic lands

QUESTION: Sir John, my family have problematic lands. It is currently occupied by squatters, the title is still in the name of our dead parents, and we have forgotten to pay the real estate taxes. What is the best thing to do?

ANSWER: Enter it into Property Management by a licensed Broker.

The Broker will visit the place to record the status of the land. The Broker will discuss ownership issues with the squatters. The Broker will give you a quotation on how much is needed to transfer the title to your name. The Broker will check out the tax arrears and negotiate the discounts with the Local Government Unit. The Broker will give you professional suggestions on the best possible use or disposition of the property. It is a lot cheaper for you to pass those headaches to the Licensed Broker.

Gain in buy and sell

QUESTION: Sir John, within the next 20 years I want to improve the quality and of the house where I reside. What will I do?

ANSWER: Either you renovate to add value to it, or you sell it and buy another house with a higher quality. I know people who now live in mansions just by reselling their own house who initially bought a small house. The technique is simple, but you have to look at the long-term, be ready to move a frequently, and forget the sentimental value of the house.

Example, your house now is worth P3 Million. What you will do is find a Licensed Broker and "offer" it for sale at P4 Million, and simultaneously, you tell your Broker that you will use the proceeds of the money to buy a new house with better quality than what you have now. Then just wait. Within the next two to three years, your Broker will be able to move you from your current house to another house with a higher value. Then just keep on repeating the process.

I know people who now live in mansions just by reselling their own house who initially bought a small house. The technique is simple, but you have to look at the long-term and forget the sentimental value of the house.

The theory that works here is that there are people who are willing to buy your property at a higher price than what it is worth. The key elements here are (1) offer it for sale at a longer period even if you are still occupying it, and (2) use a Licensed Broker who is familiar with this real estate management technique.

When is the right time to sell?

QUESTION: Sir John, when is the right time to sell our idle land? What is your advice?

ANSWER: It takes time to sell a real estate. Even if you are half-decided to sell it, you can already offer it for sale just to get potential buyers. When you need the money and the buyer is already on stand-by, you can sell it without waiting so much time finding a buyer. Advice: Sell it through a licensed Broker.

Offering the property for sale does not mean that you are already obliged to sell it. Don't get too excited, offering it now will not automatically make it sold within the next six months. In fact, most of the time, it takes years before a property gets sold. The decision formula is, if you want your property converted into cash within the next three years, then start finding a licensed broker NOW so that it will be listed in the multiple listing network of the brokers.

7/02/2010

Procedure on Real Estate Sale Transaction - Part 3 of 3

[Basic Knowledge for Brokers]

This is the complex step-by-step procedure followed by a licensed Real Estate Broker to perfect a real estate sale transaction.

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Go to PART 1
Go to PART 2

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Payment of Transfer Tax

§ Payee: Treasurer of the City of _______________

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Payment of the Registration Fee

§ Payee: Registry of Deed for __________________

§ Tip: The buyer should prepare a separate check representing the BIR payment in the account of the seller. (The amount is to be deducted from the final balance of the purchase price). This facilitates the processing of the BIR payments.

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Paying BIR: Capital Gains Tax/ Creditable Withholding Tax and Documentary Stamps Tax

Proceed to the Officer of the Day at the BIR office and present the following documents:

§ Original Owner’s Duplicate of Title or Certified True Copy of the Title

§ Deed of Absolute Sale (notarized)

§ Special Power of Attorney (if applicable)

§ Certified True Copy of Tax Declaration of the lot and improvement

§ Form 1706 or 1602-E

§ Form 2000

§ Form 1904 or 1903 (to check the TIN of seller and buyer)

§ For vacant lots: (1) Sworn Statement of No-Improvement (notarized) and (2) Certificate of No-Improvement from the Assessor’s Office

§ For condominium units: (1) Certificate of Management from the Condominium Association

§ For corporation: (1) SEC Registration, (2) Board Resolution authorizing registration, (3) Special Power of Attorney (if applicable)

The BIR Officer of the day will check all the documents and compute the Capital Gains Tax or Creditable Withholding Tax an Documentary Stamps Tax

The TIN of the seller and buyer will be verified in the computer. If the seller or buyer has no TIN, a new TIN will be assigned by the BIR.

Taxes are paid at the accredited bank nearest the BIR branch. Requirement of the bank:

§ Form 2000

§ Form 1706 or 1601-E

§ Deposit Slip

§ Cash or Manager’s Check

§ Get official receipts or deposit slips of the taxes you paid. Make sure that your also have the machine validation on Form 1706/ 1601-E and 2000. Make duplicate copies.

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Go back to the BIR office and submit your proof of payment from the bank together with all the documents that you previously presented to the Officer of the Day.

§ The Officer of the Day will again check the documents.

§ You will buy the documentary stamp and pay the Certification fee.

§ You will then submit all the documents and the stamp to the BIR personnel in charge of this work.

§ The personnel will record the transaction and the documents and will issue a claim slip indicating the date when you will return to claim the Certificate Authorizing Registration (CAR)/ Tax Clearance. It normally takes 5 working days to get the CAR/ Tax Clearance.

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Paying the Transfer Tax

For properties in Pasig and Quezon City, once you get the CAR from BIR, proceed to the Treasurer’s Office to pay the Business Tax aside from the Transfer Tax. In other cities, only the latter is necessary. Requirements of the Treasurer’s Office (photocopies only):

§ Title

§ Deed of Absolute Sale with BIR stamp

§ Tax Declaration- Certified True Copy, both of lot and improvement

§ CAR/ Tax Clearance from BIR

§ Form 2000

§ Form 1706 and 1602-E

§ Official receipts of the payment of the CGT/CWT/DST

§ Property Tax Clearance

§ Certificate of No-Improvement

§ If the seller is corporation, submit a Mayor’s Permit for Pasig and Quezon City

§ SEC registration/ Articles of Incorporation

§ Board Resolution/ Secretary’ Certificate

The Transfer Tax is 0.5% of the selling price or zonal value whichever is higher. However, there are municipalities where the Transfer Tax is based solely on the selling price. For Example: Quezon City charges 0.75% of the zonal or selling price, whichever is higher.

The Business Tax should be paid within 60 days from the date of sale. If the processing of BIR payment is expected to extend beyond 60 days, you can immediately pay the Business Tax and Transfer Tax without waiting for CAR to be released from BIR to avoid penalty.

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Transferring the title at the Registry of Deeds

Requirements of the Registry of Deeds:

§ Original Title

§ Original Tax Declaration/ Certified True Copy (lot and improvement)

§ Original Realty Tax Clearance- from Assessor’s Office

§ Original Official Receipts of the Capital Gains Tax/ Creditable Withholding Tax, Documentary Stamp Tax, Transfer Tax, Registration Fee (to be submitted to the Registry of Deeds after paying)

§ Original CAR or Tax Clearance Certificate from BIR

§ Original Deed of Sale with BIR stamp at the back

§ Special Power of Attorney, if applicable

§ For Corporations: (1) SEC registration/ Articles of Incorporation, (2) Board of Resolution/ Secretary’s Certificate

A personnel in the Registry of Deeds will check all the documents and then compute the Registration and Miscellaneous Fees. After paying the fees, a claim stub will be given indicating the date when the new Title will be released.

Tip: Always proofread the new Title versus the old one while in the premises of the Registry of Deeds for typographical errors. If there are errors, have them corrected immediately.

If the buyer will mortgage the new Title with the bank, get immediately a certified true copy of the cancelled Title (Title that was in the name of the seller). The bank will require for its submission.

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Procedure in transferring the Tax Declaration (Assessor’s Office)

Submit the requirements of the Assessor’s Office:

§ Certified True Copy of New Title or the original copy

§ Deed of Absolute Sale

§ Transfer Tax Receipt

§ Tax Clearance

§ CAR/ Tax Clearance

§ For Corporations:

§ SEC registration/ Articles of Incorporation

§ Board Resolution/ Secretary’s Certificate

You will be issued a stub indicating the date when you will get the new Tax Declaration. This usually takes a week.

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Get and submit the final documents to the buyer

Once you get the new title from the Registry of Deeds, immediately transfer the Tax Declaration in the name of the new owner so that you will not be required to get a certified true copy of the new Title. You just have to show the new owner’s duplicate copy of the Title.

Submit the final documents to the buyer

§ Title under the name of the new owner

§ Tax Declaration in the name of the new owner

§ Official receipts of the ff:

§ CAR/ Tax Clearance Certificate

§ Form 1706 or 1602-E

§ Form 2000

§ Other documents

All original documents should be given to the buyer except for the official receipts of the Capital Gains Tax and Documentary Stamp Tax (if paid by the seller). Provide one set of the above documents (photocopies only) to the seller for his file.
Get your Commission

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Go to PART 1
Go to PART 2

Procedure on Real Estate Sale Transaction - Part 2 of 3



This is the complex step-by-step procedure followed by a licensed Real Estate Broker to perfect a real estate sale transaction.

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Go to PART 1
Go to PART 3

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Submit written computation of expenses to be shouldered by the seller

The seller would like to know the expenses he will shoulder and the net amount he will get in the sale of the property.

§ Capital Gains Tax / Credit Withholding Tax

§ (6% of the zonal value or selling price, whichever is higher)

§ Documentary Stamp Tax (DST)

§ (1.5% of the zonal value or selling price, whichever is higher)

§ VAT, if applicable

§ (10% of the zonal value or selling price, whichever is higher)

§ Business Tax (This applies to properties located in Pasig City and Quezon City)

§ Broker’s fee or commission

§ Other arrears

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Documentations involved in marketing the property

Prepare the marketing materials- the following data are needed in preparing the materials:

§ Pictures of the property (remember the camera)

§ Description

§ Location plan

§ Selling price

§ Special features, etc.

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Promote the property

§ Advertisements in newspapers

§ Emails to clients and brokers

§ “For Sale” signs on the property

§ Flyers

§ Tip: Prepare winning and attractive advertisements. Look at the ads in the papers and see what catches your attention. Design your ads around them. Two to 3 good ads can be alternately published in the newspapers. Vary the theme of your ads presenting different features of the property.

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Create a Buyer’s Information Sheet (BIS)

This where you can record important information about the client and his requirement. The BIS contains general information data of the prospective buyer (name, address, telephone number) and the allocated budget, preference, etc.

Tip: Index cards are handy in organizing and classifying the buyers according to their requirements.

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Prepare a list of properties that you intend to show the client

Give the client a copy of the itinerary of the tripping. At the end of the tripping, ask the client to sign your copy of the listings. This is a proof that you showed client the properties to protect you from buyers who decide to bypass you and deal the sellers.

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Give a copy of the assigned document to the seller

Better yet prepare a letter registering the buyer’s name to the seller and have it acknowledged by the seller. Indicate the date when the seller received the letter.

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Documentations involved during the negotiation

Offer to buy- the buyer may give an oral or written offer to buy the property. A written offer is preferred with the affixed signature of the buyer an received by the seller. The written offer shows the seriousness in buying the property.

Items that should be in the offer:

§ Price being offered

§ Deposit money

§ Mode of payment- cash or installment

§ Dates of payment

§ Expenses to be shouldered by the buyer

§ Other conditions

Tip: Keep a diary- At this stage of the transaction, you will be communicating both with the seller and the buyer very often. Record all conversations and meetings with the buyer and seller in your diary. Write all the dates of activities pertaining to the transaction. You can refer back to these records if there are some events you need to recall.

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Closing the sale

The sale is consummated when there is the meeting of the minds between the buyer and seller on the price, terms and conditions on the property.

Tip: Always put in writing the agreed terms and conditions and have it signed by the seller and buyer to avoid misunderstanding. If the seller and the buyer are not present, you can fax or email the agreed terms and conditions to each party and have them confirm it. This will now be your guide in preparing the sales contract.

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Documenting the sale

Determine the appropriate contract to complete the sale. The kind of contract you need depends on the nature of the sale transaction. There are two principal kinds of sale:

§ Absolute Sale- It is an outright sale. The buyer will pay the amount in full and the seller will immediately transfer the owner of the property to the buyer. There are no conditions imposed in this kind of sale.

§ Conditional sale- There are conditions set on the sale which should be fulfilled by the parties involved before the owner can pass the ownership of the property to the buyer. Normally, payment of the purchase price is on installment or staggered basis.
Draft the contract

§ The real estate broker drafts the contract as prescribed by the client. There are available legal forms that can be used as guide for making the contract. Remember, the fewer the terms of the contract and the briefer they are, the better.

§ Present the draft to the seller and the buyer

§ Suggest that they hire the services of a lawyer to review the draft of the contract. This will relieve you of the burden of having to worry about legalities and accurateness of the contract.

§ Tip: Unfortunately, not all lawyers are familiar with real estate transactions especially when the sale requires bank financing.

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Finalize the contract

After the seller and buyer with their lawyers have agreed on the final provisions of the draft, you may now make the final contract. Again have the contract reviewed and approved by the seller and buyer.

§ Schedule signing of contract and make sure that all the necessary documents are available for turn-over to the seller/buyer

§ Prepare acknowlegement receipts to be received by the buyer and the seller enumerating all the documents that were given to them. Some of the documents submitted to the buyer will later be turned over to the broker to be used in processing the taxes to be paid to the BIR and in transferring the title to the buyer.

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Payment of Capital Gains Tax/ Documentary Stamp Tax

The BIR, Registry of Deeds and the Treasurer’s Office only accept cash or manager’s check. Here is how the checks should appear:

§ Payee: Name of BIR accredited bank and branch

§ For the account of BIR

§ For the account of (name of taxpayer)

§ TIN of taxpayer

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Go to PART 1
Go to PART 3