Do you agree with the guy? He is in the top 20 wealthiest person in the world.
To some extent he is correct:
1. Most people know exactly the pricing for real estate in the vicinity and some sectors are expert. Unless you are a loan shark or "ilit" bank (bank that loves to foreclose way way below the market price) chances are there is not much of price advantage you can have.
Land and condos are valued at 6 numbers in MM, in the province it is typical to for raw land for 4 numbers
2. The tax angle. At least in the PHL, buying and selling does not favor the investor because of stiff Capital Gains tax(8% Doc Sci included) and VAT of 12%. (for capital goods) (We backed out of a deal then because 70% of the SP would just go to taxes. BIR updates its zonal valuation frequently and sometimes their values are higher than actual transactions. The govt is raking in with the CGT and VAT. A condo in Cubao which is P12M at market, was being offered at steep discount of P7M. However after computing for bank financing, HoA fees, commission, etc. the margins would be only single digit if we flip. Hence the doomed condo situation in the PHL
Such situation of say 6 numbers price for land in MM say a 500 sm residential property being sold at P100M would be profitable for residential owner selling to a developer. But maybe not to a developer or land banker.
What do you think? Lately we shied away from land development. Especially on land sale approach.
