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Mike Ferry , the founder of The Mike Ferry Organization, the leading Real Estate Coaching and Training Company; he has been involved in sales and management for more than forty years, earning an unmatched reputation for success built on a foundation of hard work, dedication to his personal goals, and an unwavering commitment to his clients and their success. He will share the differences between the most successful and unsuccessful real estate people.
Please watch this video to know what are these.
Category : Blog
In this video courtesy of 9 News & Current Affairs , we will find out the answers to the questions ‘What laws protect the rights of real property owners?’ and ‘What agencies implement these laws?’ from Atty. Voltaire.
Enjoy watching!
Category : Blog
By: Dyan Ramos
The following are list of things that were probably not taught to many of us in childhood. Things we don’t know from the start that we are regretting, we will appreciate it, once we start practicing it. I listed them down based on my experience mingling with businesspeople & experienced financial coaches themselves. Friends, enjoy the “7 Secrets of the Rich”:
1) Rich people believe failures are essential part of growth and success. It is not a few times when we have been conditioned not to make mistakes — whether at home, school or work. Most of us grew up “afraid to fail” because we’re used to have it accompanied by a punishment. The worst is people in our past used these failures and mistakes against us that made us go for the safer sail. Notice therefore that 90% of Filipinos would go for job security (afraid to take risks) rather than aim for perfection in business. Because we’re afraid of the unknown and the unfamiliar, we’d rather not talk about money and instead go on with our mediocre life expecting everyday to be the same at the office. Yet, when you think of the most successful and the wealthiest people on earth, none of them talked about a perfect journey while in the process of getting rich. Nanay Socorro of National Bookstore, Mr. Henry Sy & Mr. John Gokongwei Jr. each had his/her own version of downfalls & failures before they made it to the top. The big secret therefore is to strengthen your tolerance to failure, and to get yourself educated to lower the risk especially in doing business and investing. In today’s information age, almost all questions about life have their answers somewhere. Take advantage of the information technologies like internet to get answers and to pacify your doubts.
2) Rich people are not the smartest; they just have better money management habits. The wealthiest of men (most of them from childhood) practice proper handling of finances and allocating their income into different purposes (e.g. 50% of income goes to Necessities, 10% goes to Charity or Give Account). The discipline to stick to the habit is already within their being as they have been practicing it for many years. They are also skilled in differentiating Assets from Liabilities, and in handling their Financial Statements. They know for instance that Assets are properties that put money INTO their pockets while Liabilities are things that take money OUT of their pockets. A house may be an Asset if it is being rented & you get monthly cashflow from your tenants, while it can also be a Liability if you are living on it & paying monthly dues for its mortgage. Same with a car, if you use it for business, it is an Asset; yet, if you bought it for personal use & leisure it becomes a Liability. The wealthy are skilled in updating their financial statements, means they’re taking account of every peso & every centavo. For ordinary Filipinos to have access on how to start writing a financial statement, the rich recommend getting a mentor who can teach you the basics of personal & business finance. You’ll discover that it really is just simple math; you don’t need to be a wizard in order to become financially successful.
3) Rich people value the spirit & culture of sharing. In a world where most people think scarcity, the rich believe that resources are abundant and that the world is overflowing with opportunities. While the poor practice the infamous “crab mentality” habit (pulling down whoever’s on top), the rich like the idea of seeing everyone succeed in business & life. You may have witnessed this among the circles of Chinese businessmen where they push each other to become richer because by then, their own businesses improve as well (i.e. they get more potential investors, people have more purchasing power, the economy gets stronger) . These Chinese businessmen protect themselves by protecting others first. The wealthy recommend an average person to practice sharing everyday — share information, ideas, opportunities and resources to others so that once wealth is in his hands; he is ready to grow it. If one wants to be successful and truly wealthy, it is crucial that he gives up attachment to money and material wealth. The most valuable factor in your journey to becoming financially free is the mindset. It’s not about how much you have now, but how ready you are for future wealth. Share what you have — be a generous giver and an excellent receiver as well. Feel like you are already wealthy by having the “abundance mentality”. The world is full of blessings & opportunities if you just look around & seek for them.
4) Rich people use the art and science of leverage in business. Leverage means using OPR or “Other People’s Resources” (i.e. time, money, talent, skills) to speed up one’s growth in business and in life. It is indeed never new to the wealthy to define an authentic business as that with at least 500 people working for the owner or with the owner as partners. It’s just natural (a universal rule), nobody gets successful in life by doing it alone. That’s why 90% of small business owners fail in the first 5 years due to mismanagement as backed up by DTI. Small businesses, specifically traditional ones, find it hard to expand with just a few workers because their income reaches a certain limit. The owner of a small business usually runs out of money or energy after a few years of operation. It lacks a system, and the power of leverage. Yet, take a look at what Mark Zuckerberg did with Facebook. As the youngest billionaire quoted by Forbes magazine, he reaches out to billions of Facebook users worldwide and leverage on them & and his system to earn $150 million annually from his advertisers. It means he can leave the business operation to his workers & the system while earning (a great example of “people & system working for him, and NOT him working for the business”). There are thousands and thousands of business ideas being created every hour at different places in the world. Yet, they are not being executed because of lack of knowledge on systems and the use of leverage.
5) Rich people think long-term. While the poor spend for their present lifestyle, the rich think long-term by buying Assets (e.g. real estate properties, businesses) that could generate passive income (income without work) and eventually give them time to enjoy their wealth. The reason most employees remain broke is that they buy Liabilities (e.g. a car, a house under years of mortgage) that take money out of their pocket. While the poor and middle class spend for now, the richest of people believe that the secret to long-term wealth is to “delay gratification”. Thus, they add more to their passive income generators (e.g. buy more properties, invest more on paper assets & businesses) so that in the future they could enjoy their wealth. They know for a fact that Financial Freedom means having not only the money but BOTH the money & the time. Lots of people nowadays may find excessive cash is not really that hard to earn, but how many of us can really enjoy these cash? How many can take vacations for the whole year & come back to find their income still flowing or even getting stronger? Not a lot I could guess. Like what my mentors would always say “better work your ass off for the first 5 years & enjoy wealth for the rest of your life THAN work easy all your life without ever having a chance to enjoy what you’ve worked for.” Yet as crazy as it may sound, statistics show that most Filipinos would rather stick to job security than start a business full time. There must be something wrong somewhere with the way we were raised and the values that were instilled in most of us.
6) Rich people prioritize financial education. One of the biggest myths in business believed by many is that a huge capital (let’s say, 20 million pesos) should be available before you can do business to enjoy the success of business tycoons like Mr. Henry Sy. Of course capital plays a role in business, but it shouldn’t be the first priority. If you talk to any of the wealthy people living today, they will tell you the same thing — focus on your financial education first. Get yourself educated in matters of business. There are thousands of books written about leadership, success and getting rich (e.g. “Secrets of the Millionaire Mind” by T. Harv Eker & “Rich Dad, Poor Dad” by Robert Kiyosaki are highly recommended). These authors gave us a chance to access the minds of the wealthy & what made them successful. There are also seminars & workshops being held by financial gurus & financial education advocates. Their aim is to make it available for ordinary people the secrets & the values practiced by the wealthy. Take advantage of these opportunities. David Bach, an American author once said “financial education needs to become a part of our national curriculum and scoring systems so that it’s not just the rich kids that learn about money… it’s all of us.”
7) Rich people find mentors that they could model and learn from. This is perhaps the most important of all the 7 secrets mentioned above. Without a mentor, somebody won’t know where and how to start. If you do not have a “rich dad” to model, the rich recommend that you search for virtual mentors (i.e. famous authors & inspirational speakers) or find a group from which you could learn BOTH the mindset and the skill set to be able to make it successful in business. Remember to look for mentors who have the experience and a good track record that prove their success. One of the great things about having mentors & coaches is that you can leverage on their past failures & experiences. Means, you do not have to undergo the same trials & downfalls because what your mentors present to you is already the proven road. Friends, family members & colleagues who aren’t experienced in business don’t count. Why listen to these people while deciding for something when they haven’t even proven to be financially free themselves? This is insane, yet most Filipinos are guilty of this. Environment, no doubt, plays the most influence in a person’s decision. If you want to get ahead of the business game & in life, surround yourself with people who can build you up & people you can model. True enough, if you want to learn yoga, you find a yoga coach. And if you want to learn business, you find a business coach. It’s pure simple logic.
Category : Blog
REAL ESTATE IS AN ALL-TIME INVESTMENT INSTRUMENT THAT GIVES POSITIVE YIELD, PROVIDED YOU KNOW THE STRATEGIES…..
The real estate scene in the Philippines especially in the Bicol Region is looking up as ever. This is evidenced by a continuous increase in residential and commercial buildings sprouting in many parts of the Region. Real Estate Giants such as the Avida Land of the Ayala Group of Companies, Camella of Vistaland, Concepcion Grande Development Inc, a subsidiary of the Consunji DMCI group are now all visible in the residential and commercial projects in Naga City. There are also homegrown developers such as the Misibis and Embarcadero owned by Zaldy Co of Albay and the CWC sport complex and Gota beach in Caramoan developed by the Camarines Sur Governor Lray Villafuerte that focused on tourism projects which attract foreign and local tourist to visit the region and experience the hospitality and warmth of the Bicolanos. You can never go wrong in Investing in Real Estate and there are basically seven reasons why moguls Donald Trump, Gary Scott and Filipino-Chinese Tan Yu bet their investment portfolio on real estate to build their empire.
1.HEDGE AGAINST INFLATION – Adding real estate into your investment portfolio can protect it against the ravages of inflation. The value of a real property increases as inflation rises. The average inflation rate in the Philippines for the past 5 years is 6.75% while average interest rate for savings deposit does not even reach 3% and for time deposit 5 to 6% which only means that interest of Money in the bank is not even enough to cover the inflationary cost.
2.RESIDUAL VALUE – Real estate always has a residual value. Although prices can certainly fall as well as rise, property values will never fall to zero unlike all shares or hedge funds. Not even the United States Housing bubble and crisis affected the Real Estate prices in the Philippines. On the contrary those who wanted better and secured real estate investments go to the Philippines due to its stability and fiscal viability.
3.HYBRID ASSET – Property is a kind of hybrid asset that has a capital appreciation of a stock and income producing capacity of a bond. The average increase of the value of properties in the Philippines is 10 to 15% per annum depending on location and development which make it earn like a stock and the ability of these properties to be rented out make it earn like a bond making it a HYBRID ASSET. Examples of these are the Condominium-Dormitoiries near the University belt in Manila.
4.EXCELLENT COLLATERAL – Real estate in prime location is always an excellent collateral security against loans and allows financing to be secured anytime. This is the reason why in property investments, there is no need to liquidate your property to acquire additional capital for business and additional investments.
5.PRE-DEVELOPMENT APPRECIATION – Units in projects that are being sold in pre-development phase generally appreciate in value when the project is finished. Investments in pre-development projects can easily appreciate from 15 to 25% appreciation in value for the first year then level down to 10% on the succeeding years.
6.EASY TO RENT OUT – Units in projects that are near malls and other high traffic areas such as the schools and offices are easy to rent out.
7.APPRECIATE AT AN AVERAGE OF 10% PER YEAR – Philippine property appreciates at an average of 10% per year, which is higher than the 3% to 6% appreciation of U.S. properties. This translates to a higher Return of Investment (ROI) on property investments in the Philippines. The reason for this is that foreigners are not allowed to own real properties in the Philippines which confine its ownership to Filipinos. Unlike in other countries where this prohibition is not present, competition and demand for property acquisition is very high which catapults property prices to a level that makes it unstable and unsustainable.
Category : Blog
While the title of this blog is quite funny for after death you won’t be expected to pay for taxes or debts that you may incur while living, but in this world, there are two things that are certain… death and taxes. There is therefore a reasonto ponder of what your family may go through when you die, they would not only be left with the thought of missing a love one but also the predicament of distributing properties (which is always not enough) to those who are left behind.
Most would think what the heck for that would not be my problem anymore, I have worked my butt off during my lifetime to provide for my family and leave assets for their sustenance.It will be their turn to worry on how to acquire the assets that I will leave behind. This selfish attitude could lead to the break-up of your family (which is very common) and in the end loose your properties to the government and lawyers.
If you love your family enough to avoid their break up and eventually loose your properties, you may have the following options:
If you have enough properties for your children:
- Take a Life Insurance Policy to protect your wealth and your insurance will answer for the taxes that may be due after your death,
- Make an ONEROUS transfer of your properties to whoever you wanted to acquire them and who are of legal age but make sure to leave some for yourself because later onyou might end up begging for sustenance and shelter. The expenses you will incur are: 1) 6% of the zonal value or appraised value of the property whichever is higher as Capital Gains tax, 2) 1.5% for the Documentary Stamp Tax, 3) about .50 or .75 of 1% for transfer tax, 4) about 1% for registration expenses and 5) other documentation & miscellaneous expenses of at least 1% or a total of about 10 to 11% of the zonal value of your properties,
- Transfer your properties through DONATIONto whoever you wanted to acquire them however make sure that you wont affect the legitime of your legitimate & illegitimate heirs for they might complain later after you die. The expenses you will incur are on this link http://www.bir.gov.ph/taxinfo/tax_donors.htm.
- You can make a Notarial or Holographic Will in favor of your heirs however you will need to consult a lawyer to guide you on making a valid will,
- Form a family corporation and transfer your properties to the corporation by assigning them (through a DEED of ASSIGNMENT) as payment for your stock purchase. That way you will not be paying for the Capital Gains tax but only the Documentary stamps tax, transfer tax and registration fees. I would recommend this as the best way to go for the following reasons:
- The properties will be preserved in the name of the Corporation and will not be in danger from being physically divided among the heirs,
- Only a simple majority among the stockholders will be required to dispose of the property in the future as compared to a property which is being co-owned by the heirs where all of the heirs should agree for the sale or transfer,
- Future sale or transfers of the share of each heir to another or a third party may be accomplished by simply transferring the shares of stock and not the title over the property and
- All the owners/heirs of the Corporation are obliged to discuss the matters affecting their properties as a collegial body and avoids judicial proceedings.
If you do not have enough properties for your Children:
- All of the options 1 to 5above are ok however option 5is the best,
- Liquidate your property/s before you die and give yourself a comfortable life, whatever is left out of the sale proceeds will be easier for your heirs to divide and
- Just die… specially if you do not have properties for your heirs
Should you decide to choose option 8 this is what you could expect to happen to your family after you die…
- Within 6 months after your death, your heirs should be able to do the following:
- Submit a Notice of your death to the Revenue District Officer having jurisdiction over your principal place of residence at the time of your death,
- Secure a separate Tax Identification No for your estate,
- Decide among themselves of who will be the administrator or executor of the properties you left behind,
- Decide whether they will settle your properties Judicially or extra-judicially and
- Find a good accountant or real estate broker to facilitate the computation and payment of the Estate Taxes over the property.
- Make an inventory of the properties you left behind including personal and real properties,
- Prepare the necessary documents required for the filing of the Estate Tax Return there are about 22 documents enumerated on this linkhttp://www.bir.gov.ph/taxinfo/tax_estate.htm, which does not include the publication in newspaper of general circulation of the extrajudicial settlement of your property for three consecutive weeks.
- Prepare the Estate Tax Return (BIR Form 1801) which shall be filed with the Revenue District Office mentioned above and make the necessary payments to the Authorized Agent Bank (AAB),
- Effective January 1 1998 up to the present, the following shall be the rate to be followed in the computation for the estate taxes:
If the Net Estate is:
|
Over |
But not Over |
The Tax Shall be |
Plus |
Of the Excess Over |
|
P 200,00.00 |
Exempt |
|||
|
P200,000.00 |
500,000.00 |
0 |
5% |
P 200,000.00 |
|
500,000.00 |
2,000,000.00 |
P 15,000.00 |
8% |
500,000.00 |
|
2,000,000.00 |
5,000,000.00 |
135,000.00 |
11% |
2,000,000.00 |
|
5,000,000.00 |
10,000,000.00 |
465,000.00 |
15% |
5,000,000.00 |
|
10,000,000.00 |
1,215,000.00 |
20% |
10,000,000.00 |
- Should your family fails to pay the taxes within the 6 months period or the extensions given by the Bureau of Internal Revenue, a Surcharge of 25% of the total tax due will be added to what they will pay plus 20% interest per annum and compromise penalty.
A thousand possibilities may happen after your death but you can narrow down these possibilities if you can prepare them and your family to what you wanted while you are still alive.
Category : Blog
I'm Arsenio "Sany" de Guzman, Jr., your real estate broker (PRC 0000518).