A step-by-step property investment guide

As the economy continues to struggle and job security becomes a question more than an answer for a growing number of Filipinos, expecting the unexpected has called to the fore the importance of one’s investments and investments in real estate.

The COVID-19 pandemic has presented struggles for the real estate sector, specifically for the acquisition of residential properties. Because of the nature of the market for residential properties — which is primarily built on in-person viewing conducted by sellers and agents in closely confined spaces — social distancing measures have all but prevented potential investors from seeing properties up close, which ordinarily plays a significant factor in the decision-making process. For some, a brochure or online listing can only do so much.

Assuming that you were lucky enough to have found a property that you may be interested in despite COVID-19 restrictions, processing of documentation with government agencies — which is a crucial and absolutely necessary step for the property acquisition process — presents its own challenges given stringent regulations on social distancing and skeletal on workforce schedules in government agencies.

If you are currently thinking of investing in a residential property, it may be one of the wisest decisions in the face of an uncertain economy. Here is a step-by-step overview of the property acquisition process and typical transaction taxes that you will need to consider.


Assuming that you have found a residential property to invest in and have successfully negotiated with the seller on a purchase price that works for both sides, congratulations are in order because that’s the hardest part.

At this point, it will be helpful to contact a lawyer, agent, or broker to assist in the finalization of transaction documents, which will usually involve a standard Deed of Absolute Sale (DOAS).

Finalization of the deed and transaction documents, of course, will be subject to an examination of documents in relation to the property being acquired, including the Transfer Certificate of Title or Condominium Certificate of Title. If the titles show encumbrances, it must be either taken on by the buyer or cancelled by the seller after discussions.

Likewise, it would be ideal to expressly specify in the deed the parties’ respective obligations for payment of taxes with the BIR and City Treasurer, as well as registration fees with the Registry of Deeds. The parties should then secure notarization of the DOAS and ensure that proper board authorities have been issued, should any of the parties be a corporate entity.


An essential element of the property transfer process is the payment of proper taxes with the BIR, without proof that the Registry of Deeds will refuse to issue a new title in the buyer’s name. Once the transfer documents have been finalized, an application for Tax Clearance must be filed with the BIR RDO having jurisdiction over the property’s location. In turn, the BIR will assess the transaction for applicable taxes, including Capital Gains Tax and Documentary Stamp Tax. Applicable taxes will be paid subject to the stipulations of the parties in the deed, and once paid, he relevant tax returns will be evidenced. The tax returns shall then be used to secure a tax clearance and Certificate Authorizing Registration, which will serve as the BIR’s approval for the transaction.

Upon securing the Certificate Authorizing Registration, you may then bring the same to the Office of the City Treasurer of the relevant local government unit to assess transfer taxes, which must likewise be paid prior to processing title transfer with the Land Registration Authority through the relevant Registry of Deeds.

Processing of Title Transfer With the Registry of Deeds

Once the proper tax liabilities have been settled, you may now bring your application to the Registry of Deeds to process the title transfer in your name. Subject to payment of registration fees, the Registry of Deeds will examine the transaction documents and tax returns. If sufficient, it will proceed with the cancellation of the previous TCT/CCT in the seller’s name and issuance of a new title in your name. The new title may then be used to secure the accompanying tax declaration from the local assessor.

Once all these are done and subject to the specific provisions of the deed, you may now move into your new home, or alternatively, keep it in your back pocket and monitor the market value of your brand new investment.

(Atty. Carlo Augustine Roman is an associate of Villaraza & Angangco. This article is intended for informational purposes only and should not be construed as legal advice. The views and opinions expressed here are those of the author and do not necessarily represent the views and opinions of Villaraza & Angangco. For comments or inquiries, please email [email protected].)