BS REAL-ESTATE MANAGEMENT STUDENTS' NOTES

REAL ESTATE NOTES FOR REAL ESTATE MANAGEMENT STUDENT

1. REAL ESTATE NOTES AND
LECTURES
PRINCIPLE OF PROPERTY OWNERSHIP
FIRST: Understand the meaning of Real Estate
Real Estate
Refers to the land and all those items which are attached to the land.
Physical, tangible entity together with all additional or improvement on,
above or below the ground.
Real Property
Refer to includes all the rights, interest, and benefits of real estate.
Public Domain
Public Use
public services
the development of the national wealth.
Keywords Public use and public service.
Patrimonial properties
Properties of the state or other public corporations which are not intended
for public use or for public services.
Classifies land of the Public Domain
A.Agriculture: Raising crops such as rice, sugar, tobacco, coconut, etc.
B.Forest or Timber: land producing wood or able to produce wood or
if agriculture crops.
C.Mineral: land which mineral exist.
D.National parks: land maintained by the national government as a
place of beauty or of public recreations.
REAL ESTATE TAXATION

2. Assessment level for land:
Residential not more than 20% FMV
Commercial / Industrial / mineral not more than 50% of FMV
Agricultural
Timber not more than 20% of FMV Scientific / Cultural / hospital.
Revised Forestry Code
Provide that No land of the public domain 18% om slope or over shall be
classified as alienable and disposable.
Land Ownership
Defined as the independent right of exclusive enjoyment and control of a
thing for the purpose of deriving therefrom all advantages required by the
reasonable needs of the owner and the promotions of general welfare but
subject to the restriction imposed by law and the rights of others.
STEPS IN APPLICATION FOR TITLING UNREGISTERED
LANDS
UNREGISTERED LANDS: lands that are not registered under the Torrens
System are considered unregistered land.
TORRENS SYSTEM: named after Robert Richard Torrens. Land registration
system adopted in the Philippines and took effect on February 1, 1903.
Land register under the Torrens System are sometimes called Torrens Title
or titled land. Torrens title is indefeasible.
Documentation system that records the transfer of land from previous
owner to the new owner
the Following steps required in obtaining title of unregistered land provided
they are alienable and disposable.
A.Surveying of land by Land Management Bureau. If not yet surveyed
under the cadastral proceedings.
Cadastral Surveying
Specializes in the establishment of real property boundaries.
Systematic survey of the whole municipality for the purpose of identifying
and delineating the individual claims of all landowners and claimants which
is serve as basis for the issuance of title or patents.
B.Application is filed with RTC.
C.Publication in Official Gazette.
D.Service of notice to all other claimant, if any.
E.Posting the municipal building where the land is located.
F.Hearing of any opposition
G.Presentation of evidence that the application is the true owner from
time immemorial.
H.Judgment by the court.
I.Decree of registration is issue by LRA/ Land registration authority.
J.Original Certificate of registration in three copies are issued by LRA.
K.COT is entered in the ROD record book.
L.Owner’s duplicate is given to the registered owner.
KIND OF OWNERSHIP
Full ownership
Naked Ownership rights to the use and the fruits.
Sole Ownership vested in only one person.
Co-Ownership vested in two or more persons.
KIND OF LAND TITLES

3. A.LAND TITLES right of owner of the extent of his/her interest by
which means he/she can maintain control. CERTIFICATE OF
TITLE.
B.LAND PATENT an exclusive land grant made by a sovereign with
respect to tract of land.
C.NATIVE TITLE property right which reflects a relationship to land
which is the very foundation of indigenous religion.
D.NAKED TITLE a min title vested in the holder of trust deed,
without any of the privileges of possession and use.
E.ORIGINAL CETIFICATE OF TITLE (OCT) a true copy of decree of
registration.
F.EMANCIPATION PATENT (EP) the grant of agriculture land to
tenant-farmers granted by DAR
G.CERTIFICATE OF LAND OWNERSHIP AWARD an original
certificate of title issued by department of agrarian reform
(DAR) to qualified ARB / agrarian reform beneficiaries.
H.CERTIFICATE OF LAND TRANSFER (CLT)
I.CERTIFICATE OF ANCESTRAL LAND TITLE title recognizing the
rights of indigenous cultural communities or indigenous people.
J.CERTIFICATE OF ANCESTRAL DOMAIN TITLE rights of possession
and ownership indigenous cultural communities (ICC’s) /
Indigenous people (IP).
K.CONDOMINIUM CERTIFICATE OF TITLE evidence of ownership
over a condominium unit issued by the land registration
authority.
DURATION OF TITLES
Life estate measured in duration by the life of natural person. Estate not
terminated by any fixed or computable period but cannot last longer than
life of lives of one or more person.
All types of title of ownership are lifetime.
BUNDLE OF RIGHTS
RIGHT TO OWN
RIGHT TO PROCESS
RIGHT TO USE
RIGHT TO ENJOY right to enjoy their properties.
RIGHT TO DISPOSE the right to transfer ownership of the property to others,
either temporary or permanent.
RIGHT TO EXCLUDE OTHERS the right to control access to their property.
MINERAL RIGHTS/ MINING LAWS rights to exploit an area for the minerals
it harbors. Or legal ownership and control of the minerals beneath a
property’s surface. Include Oil, Natural Gas, Coal, Precious Metals and other
valuable resources beneath a property surface.
WATER RIGHTS P.D 1067 water code of the Philippines.
LIMITATIONS ON LAND OWNERSHIP BY PRIVATE
RESTRICTION
COVENANTS, CONDITIONS AND RESTRICTION agreement that limits the
property owner.
LIENS (MORTGAGE LIEN, MECHANICS LIEN) security of debts. Mortgage lien
released the loan amount is paid un full; MECHANICS LIEN legal claims
against home or other property, used by subcontractors and suppliers when
they haven’t received payment for improvements they made to a property.
Protection for labor or materials for real estate improvements.
EASEMENTS (EASEMENTS APPURTENANT, EASEMENT IN GROSS)
ENCROACHMENT
ADVERSE POSSESSION (PRESCRIPTION)

4. LIMITATIONS ON LAND OWNERSHIP BY PUBLIC
RESTRICTION
A.INHERENT POWERS OF THE STATE
1.POLICE POWER
2.TAXATION
Rate of Real Estate Tax
a.Provinces not exceeding 1% of assessed value.
b.In Cities and metro Municipalities not exceeding 2% of
assessed value.
c.special Education Fund Tax an annual levy on real estate
equivalent to 1% of assessed value which be in
additional to basic real estate tax.
CAPITAL GAINS TAX.
Rate and basis Tax the rate of capital gains tax is 6%
computed on the following.
Sale of lot basis is price per deed of sale or lot zonal
value, whichever is higher.
Sale is lot with improvement basis is price per deed
of sale, lot zonal value plus improvement value,
whichever is higher.
WITHOLDING TAX
Transaction subjects to withholding tax – sale, exchange, or
transfer of ordinary asset by natural persons, corporations,
estate, or trust.
Rate and basis computed on the same basis as capital gains
tax, the rates of creditable withholding tax.
RATE OF WITHOLDING TAX
0% property sold is part of an HLURB registered socialized
housing project of the seller.
1.5% seller is habitually engaging in real estate business and
the price does not exceed P 500,000.00
3.0% seller is habitually engaging in real estate business and
the price is over P 500,000.00
5.0% price exceeds P 2,000,000.00
6.0% seller is not habitually engaged in real estate business.
3.EMINENT DOMAIN the power of the state to take private
property for public use.
B.IMPOSED BY LAWS
1.LEGAL EASEMENT
2.RENT CONTROL LAW
3.ZONING REGULATIONS / ORDINANCES
4.SUBDIVISION LAW
5.BUILDING CODE
6.ESHEAT
MODES OF ACQUIRING LAND OWNERSHIP
A.PUBLIC GRANT
1.HOMESTEAD AND FREE PATENT mode of acquiring alienable
and disposable lands of the public domain for agricultural
purposed conditioned upon actual cultivation and residence.
2.FREE PATENT FOR RESIDENTIAL LANDS acquiring ownership of a
certain parcel of alienable and disposable land. (under DENR
CENRO to PENRO)
3.SALES PATENT Direct sale of residential lands without Public
Bidding

5. 4.EMANCIPATION PATENT ownership of land granted or awarded
by the DAR to farmer-beneficiary, contains the restriction and
conditions. (Department of Agrarian Reform)
5.ACQUISITION THROUGH BATAS PAMBASA BILANG 185 refers to
either voluntary or involuntary sale, devise, or donation. Any
Filipino who has lost his Philippine citizenship may be a
transferee of private land.
B.PRIVATE GRANT voluntary transfer or conveyance of private
property by a private owner, such as sale or donation.
C.INVOLUNTARY GRANT acquisition of private property against the
consent of the former owners, such as foreclosure sales, execution
sale or tax sale.
D.INHERITANCE
E.RECLAMATION submerged land, subject to existing laws and
government regulations.
F.ACCRETION adjoining the banks of river due to gradual deposit of
soil.
G.ADVERSE POSSESSION OR PRESCRIPTION title by actual, open,
continuous, and uninterrupted possession in the concept of owner
for the period required by law.
CHARACTERISTICS OF LAND OWNERSHIP
OTHER RELEVANT PROVISION ON OWNERSHIP
A.RES NULLIUS CONCEPT
3 KINDS OF PARAS
1.RES NULLIUS
2.RES COROMUNES
3.RES ALLEJUS
B.STEWARDSHIP CONCEPT prioritizes accountability, responsibility
and sustainable and ethnical. Property is supposed to be held by the
individual only as trustee by people in general.
C.EXTENT OF LAND OWNERSHIP
D.DOCTRINE OF SELF HELP
E.HIDDEN TREASURE
SITE LOCATION AND MAP READING
A.LEGAL DESCRIPTION
1.METES AND BOUNDS
2.RECTANGULAR SURVEY SYSTEM
3.PLAT SURVEY METHOD
B.MAP READING
1.BASIC POINTERS
a.CARDINAL DIRECTIONS
b.BEARING AND AZIMUH
c.SCALE
d.REFERENCE POINT
2.TERMINOLOGY IN MAP READING
a.SURVEYING
b.LOT PLOTTING
c.MAP
d.TIE POINT
e.THE LINE
f.ORIGINAL SURVEY
g.CADASTRAL SURVEY
h.RELOCATION SURVEY
i.SUBDIVISION SURVEY
j.TOPOGRAPHIC SURVEY
k.CONTOUR LINES
l.LOT PLAN
m.SUBDIVISION
n.SIMPLE SUBDIVISION
o.COMPLEX SUBDIVISION
p.SQUARE PLANNING
q.GRIDIRON
r.CHAPLAN

6. s.CUL-DE-SAC
t.KEY LOT
u.SURVEYING SYMBOL
i.BLBM
ii.BLLM
iii.PBM
iv.MBM
v.CBM
vi.BBM
vii.PLD
viii.PLS
ix.NR
x.PR
xi.TSI
xii.TSE
xiii.MR
xiv.CSD
xv.CCS
xvi.CEN
V. DUE DILIGENCE
REAL PROPERTY
A.ACCESSION INDUSTRIAL
a.BUILDING
b.PLANTING
c.SOWING
B.ACCESSION NATURAL
a.ALLUVION
b.AVULSION
c.CHANGE OF RIVERBEDS
C.CO-OWNERSHIP
a.POSSESSION
b.USURFRUCT
c.EASEMENT
COOPERATIVE OWNERSHIP
ARTICLE II: SECTION 1 OBJECTIVES.
ARTICLE III: GENERAL ELIGIBILITY REQUIREMENTS
ARTICLE IV: LAND ACQUISITION
SECTION 2 TECHNICAL REQUIREMENTS
SECTION 3 FINANCIAL REQUIREMENTS
a.LEGAL BASIS
b.SCOPE
c.TENURIAL ARRANGEMENT
d.PROOF OD OWNERSHIP / POSSESSORY RIGHT OF MEMBER
TO HOUSE AND LOT / UNIT
1.CAPITAL OR MEMBERS EQUITY
2.CERTIFICATE OF OCCUPANCY
e.ESTATE MANAGEMENT
f.CONVERSION TO A HOUSING COOPERATIVE
ALIEN OWNERSHIP

7. BASIC APPRAISAL PRINCIPLES:
Marketing Value – it is the cornerstone principle of appraisal. It’s defined as
the most probable price that a property should bring in a competitive and
open market under all condition’s requisite to a fair sale. Appraisers use
market value as the basis for estimating the value of a property.
3 Approaches to value
1.Sales Comparison Approach – a method used in real estate
appraisal to estimate the value of a property by comparing it to
similar properties that have recently sold in the same area,
considering factors such as location, size, age, condition, and
amenities.
2.Income Approach – for income producing properties the appraiser
estimates the property’s value by analyzing its potential income
stream.
3.Cost Approach – determines the value of the property by estimating
the cost to replace it with similar property adjusted for depreciation.
CONCEPT OF HIGHEST AND BEST USE
This entails identifying the most appropriate market and the most profitable
use within that market.
1.Legally permissible – the property tax appraiser must consider the
effect that any enforceable government restriction, such as zoning
regulations, have on the value of property.
2.Physically Possible – the proposed must fit the size, shape,
topography, and other specific characteristics associated with the
location.
3.Financially Feasible – there must be a demand for the use in the
market that will sustain sufficient income to cover the cost of
construction to have enough money for maintenance during the
economic life of the property.
4.Maximally Productive – the one that produces the highest residual
land value or yields the highest return to the investor.
PRINCIPLES OF VALUE
Principle Substitution – ensuring that properties are priced competitively
based on what similar properties are selling in the market for buyers won’t
pay more for a property than they would for a similar one in the same area.
Principle of Contribution – this recognizes that the value of an
improvement depends on its contribution to the property’s overall
value.
Principle of conformity – properties that conform to the prevailing
characteristics of their neighborhood or market area lend to realize their
maximum value.
Principle of Regression and Progression – the value of a property may
be influence need by the value of surrounding properties.
Depreciation – a simplified method used to evaluate the economics loss
in value of an asset from beginning to the end of a reporting period.
3 MAIN TYPES OF DEPRECIATION
1.Physical Depreciation – Loss in value of a property due to wear and
tear, aging, or obsolescence of its physical components.
2.Functional Depreciation – when a property become less desirable or
functional due to outdated design features or layout.
3.External Depreciation – External Factors, such as changes in the
surrounding neighborhood, can also affect a property’s value.
Plottage Value – the increase in the value that results from combing two or
more adjacent properties into a large parcel.
Land Value – Value of the land itself, separate from any improvements.

8. Zoning Regulations – rules that regulate land use by dividing areas into
zones with specific permitted uses and development standards.
Appraisal Standards – are guidelines and principles that professional real
estate appraisers follow when conducting property valuations.
UNIFROM STANDARD OF PROFESSIONAL APPRAISAL PRACTICE (USPAP)
Outlines ethnical requirements, competency criteria, and reporting
standards that appraisers must adhere to when performing appraisals.
COMPREHENSIVE LAND USE PLAN (CLUP)
Serves as a blueprint for sustainable land use and development, balancing
social, economic, and environmental considerations.
THE 12 STEP CLUP PROCESS
1.Organize – establish a team or committee to oversee the CLUP
process.
2.Identify stakeholders – identify and engage key stakeholders.
3.Setting a vision – for the future development of the LGU.
4.Analyze the situation – to identify strengths, weaknesses,
opportunities, and threats.
5.Settling land use Goals and Objectives – align with the vision.
6.Establish Development Thrust and spatial strategies – to guide land
use allocation.
7.Preparing a land use plan – to aliened the established goals and
objectives.
8.Draft the zoning ordinance – to regulate land use activities.
9.Conduct public Hearing – to solicit feedback from stakeholders on
the proposed (CLUP)
10.Review, Adopt, approve – Finalizing CLUP and Zoning Ordinances.
11.Implementing CLUP and zoning Ordinance – by allocating resources
12.Monitor and evaluate – the effectiveness of CLUP and zoning.
Principle and approaches in the formulation of the comprehensive land
use plan (CLUP)
Watershed Approach – considering watershed as a unit of analysis.
Inclusive and Expansive Governance – inclusive involves engaging diverse.
Co-management Principle – emphasize collaborative decision making and
shared responsibility among stakeholders in managing land resources.
Gender Responsiveness and sensitivity – ensure that the CLUP recognizes
and addresses the specific, needs, priorities and perspectives of women,
men, and gender diverse groups.
Bottom – Up Approach – engaging local communities and grassroot
organization in the CLUP process from the outset.
Top-to-Bottom Approach – ensure the vertical integration and alignment of
land are planning across different levels of government, from national
policies to local implementation.

9. MOJON aka boundary stone, monument
B.L – Bureau of Lands. It means that is surveyed by the Land Management
Bureau.
A.R – Agrarian Reform. A surveyed land for Agricultural Purpose
P.S – Private Surveying. It is surveyed by a PRIVATE geodetic engineer.
P.L.S – Public Land Subdivision. Surveyed land for public use like parks,
streets, halls etc.

10. PURPOSE OF APPRAISAL
Appraisal – an act or process of estimating value. It is a supportable or
defensible estimate of value as of point in time.
TYPES OF APPRAISALS
ORAL REPORT – should include a description and value of the property along
with facts, assumptions, conditions, and reasoning on which the value
opinion is based.
LETTER REPORT – a documents written by the human resources department
of an organization to appraise on employee’s performance, the letter
typically contains a description of the employees’ job duties and
responsibilities and an evaluation of their work performance.
NARRATIVE REPORT – full narrative appraisal means a report completed by
an accredited appraiser and is an in-depth report which typically consists of
a letter of transmittal: summary of important conclusions, regional and
neighborhood analysis; description of the site and any improvements;
highest and best use analysis; zoning analysis; tax analysis; statement of
ownership and property rights appraised.
FORM REPORT – is a type of form and report for getting data in and reports
for presenting data out. Forms are used to present or collect out. Forms are
used to present ot collect information on a single item such as a customer,
product or event. Reports on the other hand, are used to convey
information on a collection of items.
PURPOSES OF APPRAISAL
SALES OR PURCHASED – a property valuation that’s determined based on
recent sale prices of properties in your area and other deciding factors,
MORTGAGE LOANS / LENDING – an appraisal is an unbiased estimate of your
propertys fair market value. Its something that is typically required by all
lenders during the mortgage process to ensure that the loan amount dooes
not exceed the value of the home / property.
INSURANCE – insurance appraisals are highly specialized reports that start
with a site inspection followed by a property analysis to determine the
calculation of supportable estimates for replacement costs.
TAX ASSESSMENT – an assessment occurs when an assets value must be
determined for the purpose of taxation. PROPRTY TAX ASSESSMENT are
based on comparable sales prices and the level of tax set by the local or
state government.
EMINENT DOMAIN (condemnation) – is a process a government or private
entity uses to legally acquire property. Authorities can condemn properties
through eminent domain to seize property from their owners. EMINENT
DOMAIN allows a property to be seized for public use such as highways,
railways, airports, powerlines, and pipelines.
PROPERTY DISPUTES – an appraisals dispute is a disagreement between the
appraised value of a property and the contract price agreed by the buyer
and seller. An appraisal dispute can affect the financing, closing, and
outcome of the deal.
INHERITANCE / PARTITIONING OF ESTATE – to determine the value of
inherited property and how are inherited properties to be distributed.
FORECLOSURE – foreclosure appraisal is typically the valuing of special
assets properties or properties where foreclosure is anticipated.
REAL ESTATE VALUTION PRINCIPLES
ANTICIPATION – present worth of all present and future benefits arising from
ownership and use of real estate. The value of a property may increase or
decrease based on a potential purchaser’s belief that some future event will
benefit or detract from the value of the property.
BALANCE -