Real Property

The growing population in the urban and suburban areas in the Philippines has increased the demand for real estate properties. Increase in property values as a result of demand offers excellent possibilities for secure investment in real property. In the Philippines, there are different opportunities in the sector which includes acquisition of raw land, construction of apartment building and purchase of condominium unit.

A raw land is defined as a property in its natural state. Due to its undeveloped form, it can be converted into commercial, residential and agricultural property. Investors are also allowed to venture on small scale lot banking. It is a type of real estate investment that is suitable for would-be investors who are willing to wait for years to sell their property.

Advantages		Disadvantages
Less cost- purchase of raw land incurs less cost relative to other real estate investments. Price appreciation- real value of raw land increases over time. Long-term investment- acquisition of raw land is an easy form of long-term investment. It also takes time for a raw land to increase its value.		No regular income- raw land does not generate steady income during the period of ownership. Expenses- raw land accrues property taxes. Not readily sold in the market- raw land is the most illiquid form of real estate investment because it takes time to sell it. Therefore, raw land cannot be quickly converted into cash.

HOW TO ACQUIRE A RAW LAND?

Before Buying
1. Check if the Project has a Certificate of Registration and a License to Sell.

You should ask the broker/agent of the owner/developer if the project is registered and has a License to Sell issued by the Housing and Land Use Regulatory Board (HLURB):

* This can be verified at the On-line Queries/HLURB website (www.hlurb.gov.ph) for the list of projects covered with Certificate of Registration and License to Sell as well as any encumbrance thereon, e.g. Cease and Desist Order, Suspension of License, etc.;
* Or you may visit or call the nearest HLURB Regional Office for this information.

2. Visit the subdivision/condominium, where the house and lot or condo unit to be purchased is located to know its natural topography, viz: susceptibility to landslide, flooding, erosion, etc.

If the project is covered with a License to Sell, you may already enter into a Contract with the owner/developer. However, there are things which must be checked:

1. The date of completion of the project as indicated in the License to Sell;
2. If the property is mortgaged, it should have a Clearance to Mortgage from the HLURB.
3. The facilities and amenities represented in the advertisement flyers/ brochures are in accordance with the approved subdivision and condominium plan on file with HLURB.

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When Buying

1. Check if the broker/agent is registered with HLURB/DTI.

2. Verify with the Register of Deeds to see if the property has not been sold to other buyers.

3. Check into your source of income whether you can afford to pay the equity and the monthly installments.

4. Check if the materials of the house or condo unit conform to the development standards and approved construction specifications submitted to HLURB.

5. Check whether the developer would pay for the water and electric meters, the subdivision perimeter fence, etc.

6. Check who would eventually operate the subdivision/condominium water system.

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Before Signing the Contract to Sell

1. Don't sign any blank form of the Contract.

2. Read thoroughly all the contents of the Contract especially the terms and conditions in fine print.

3. Secure a copy of the Contract and all other documents that you have signed.

4. Make sure that the Contract would be registered by the owner/developer to the Register of Deeds.

5. Pay directly to the owner/developer or the marketing agent authorized by said owner/developer only.

6. Ask for an official receipt on all payments for your file.