Any plans to invest for real estate this year? How much will it cost to acquire a property? Since last year, a lot of properties has been in a slow down due to the pandemic.
Last March 2020, Bangko Sentral ng Pilipinas or BSP slashed its policy rate by 50 basis points to 3.25%, following a 25-basis point rate cut compared the previous month. The overnight lending and repurchase facility (RF) and deposit facility were trimmed, to 3.75% and 2.75%.
When my mom acquired our current house after 6 years of renting it, the process is tedious but what she did is to estimate mortgage affordability based on income and loan it to a bank. It took 5 years to complete the loan payment for the said house. They searched for low-cost house and lot for sale near our place. Luckily, the previous owner of the house offered us to loan the property through bank financing.
Did you know that buyer pay the fee of around 1% to 1.5% of the selling price of a land when they will have a notarized Deed of Absolute Sale? Obtaining a property through an agreement that a buyer will sign a valid notarized Deed of Absolute Sale once it is finished assessing the property to purchase, reviewing the premises and legal paperwork.
According to Presello, the maximum amount of residential land that can be purchased is 1,000 square meters of urban land. Investing this year according to The Manila Times, “property as an investment remains a stable and safe option, with upcoming developments in the country’s business environment and national infrastructure projects set for completion.”.
Transferring a land title, there’s a procedure in order to legalize that you’re the owner of the house and lot. First, the owner and the buyer must agree on the sale of the said property. You must have a lawyer who will provide a notarized Deed of Absolute Sale.
Secure a Land Tax Declaration from BIR or Bureau of Internal Revenue. This document must be submitted to the city’s assessor’s office. Then, the buyer will pay the real estate tax to the city treasurer’s office. Someone from the assessor’s office will assess the market value of the property.
You need to pay the following: Transfer taxes to the assessor’s office, and Capital Gains Tax and Document Stamp Tax to BIR. After accomplishing the payments, you need to visit the Registry of Deeds who will nullify old titles and issues a new one under the name of the new owner of the property. It will take at least 1-2 months or more depending in which city did you purchase the property. In my mom’s case, it took at least 3 months to process it.
Lastly, the new owner will obtain a photocopy of the new title and need to request a tax declaration from the Assessor’s office.