Homes For The Law and REIT

Wow, I didn't realize I hadn't blogged in more than a week!  10 days to be exact.  Truth is, news tend to be more or less the same, day in and day out.  Save for your occasional surprising tidbit, like Holcim increasing the price of cement by P10 when demand is seen to actually start falling due to the wet season, there's really not much to say about the real estate industry.  Sure there are still lots of exciting developments; condos are springing up left and right, even in Leyte, can you believe it?  But in general, there aren't a lot of really interesting news to share.  Well, I decided to just talk a bit about P-Noy's effort to help out our cops and soldiers, and the REIT again.

News about the housing units distributed to qualified policemen and soldiers is interesting because everybody's struggling to get their own piece of land, and being a cop or soldier in the Philippines doesn't exactly make one rich.  So it's always good news to hear about the government helping them out.  It's not a bad deal, too.  The article states: "A housing unit at the AFP/PNP Heroes Ville Housing Project in San Jose del Monte City with a lot area of 36 square meters and floor area of 22 square meters is worth P140,000, payable in 30 years at six percent per annum."  The monthly amortization starts off at P200 for the first 5 years, and gradually goes up to P809.53 from the 26th year onwards.  Maybe that'll be enough incentive for our law enforcers to stay clean, if you get what I mean.

As far as the REIT goes, Finance secretary Cesar Purisima said he had signed the tax rules already, but the government will impose value-added tax (VAT) on properties that will be transferred to REITs.  Still, notwithstanding that fact, shares of property developers such as Ayala Land and SM Prime Holdings have gone up on speculation that the introduction of REIT in the country will boost its value.  Philippine Stock Exchange President Hans Sicat disclosed that the minimum public ownership required is 40%, which will further be expanded to 67% in the next three years.  I think it's wise to keep an eye out for this investment, as the real estate industry in the Philippines is currently very healthy, one might stand to gain a lot, were one to play the cards right.

That's all for now, folks.  Have a good weekend, watch a movie, spend time with loved ones.  Be happy, stay healthy.

Jon

Real Estate Investment Trusts (REIT) On The Move!

Ready?  Invest!

This isn't really about real estate as it is about investing, but it's such good news that I can't help but talk about it! If you search around for REITs (or Real Estate Investment Trusts), it's hard not to be excited, especially if you like investing your money in stocks, mutual funds, or the like.  However, REIT hasn't really taken-off in the Philippines, despite the passing of the law last 2009.  Apparently though, it looks like the Bureau of Internal Revenue is optimistic that the implementing rules and regulations (IRR) of the REIT act will be ready to go as early as July 2011.  If it happens and REIT gets off the ground, we're in for one sweet ride!  So investors, get your finances ready, be ready to move once the light turns green.  Let's GO!

Here are some relevant links about REIT that you may want to read:

• RA 9856: REIT Passes Into Law
• REIT Tax Exemptions
• REIT Delays Due To Disagreements
• REIT Rules Expected in July 2011

Where's my investment broker?!?

Jon

REIT Tax Rules To Be Tackled

I read in BusinessWorld Online that the government representatives and the private sector are set to give the long-delayed REIT law another go next week.  The implementation of the REIT or Real Estate Investment Trust (Republic Act 9856) in the Philippines has stalled despite the law being passed in 2009.  The private sector, led by BDO Capital and Investment Corp. President Eduardo V. Francisco, wants more tax exemptions, particularly the VAT of 12%, to be eased, to attract more investors.  Several property big names have already expressed interest in REIT ventures, among them SM Prime Holdings, Inc., Ayala Land, Inc. and Robinsons Land Corp.  However, the Department of Finance does not agree, saying that VAT exemption will lead to billions lost in potential revenue.

REIT has the potential to further make investors excited with investing in real estate.  Let's hope the powers-that-be can finally come to an amicable solution.  

1,000 shares please,
Jon