In the efforts of promoting safe and legitimate real estate transactions in the Philippines, the Housing and Land Use Regulatory Board (HLURB) announced a set of revised implementing rules and regulations (IRRs) for Presidential Decree 957. Under Board Resolution Nos. 921 and 922, brokers and salespeople are mandated to get HLURB accreditation or license before they can engage in Philippine real estate services.
But how do you get accredited? We have compiled all the basic facts and steps of registering with HLURB as a broker or as a sales agent in a helpful infographic below that you can keep as a photo download on your computer, smartphone or tablet.
As the outlook on the Philippine real estate industry is bright and will continue to be in the next 10 years, it is no wonder why people are flocking to be real estate brokers, agents, and dealers.
Real estate brokers and agents help clients buy, sell, lease out, or rent properties. As a licensed real estate broker, you receive payment, a sales commission, for successfully providing a match to your clients’ needs. Real estate owners pay you to find buyers. When a sale is finalized, you get your commission – sales commissions can range up to millions.
Here are 5 reasons why the real estate broker is considered a high-end profession:
1. Not only a profession but also a businessYou can get into this line of work both as a career and as a business. By becoming a real estate broker, you virtually start your own business. The good news is that this business has a very low cost – the cost of your license exam that is administered by the Professional Regulatory Commission. Brokers are given licenses because you will be managing sales agents under you.
2. You manage your own timeAs most real estate brokers are self-employed or independent contractors, it means you are your own boss, but setting your own daily schedules does not mean you have more me time. More often than not, you will be working long and irregular hours. But the upside is that you will be working for yourself as you keep developing your client base and devising ways to market their properties.
3. You determine your earningsThere are no limits on your real estate business. Controlling how your business will grow is all up to you. Aside from your motivation to succeed, coupled with good business skills and an effective marketing plan, it’s all in your hands. And with the right attitude, a strong work ethic, you can be well rewarded. When you hit the proverbial jackpot, in a single transaction, you can earn millions.
As a broker, having agents under you also means you get a share on their sales commission. With more agents under you, there is more earning potential.
4. The greater exposure, the betterAs you will always be looking for ways to re-brand yourself reminding people that you are the real estate broker they should be tapping when they’re thinking of real estate, you will be meeting and mingling people from all walks of life. Knowing and being known is critical. You will be creating opportunities for you and your team and you will be rubbing elbows with the in-crowd as most real estate owners or those keen on buying are a sophisticated and discerning lot. Working on premium luxury projects means interacting with people who are working at an extremely high-level market.
5. Earn while building RelationshipsAnother fun part is that your audience needs to associate your face and your business together. People will work with you because they trust you. In real estate, you are constantly building relationships. In closing that deal, and eventually getting that sales and commission, your reputation in the community is at work.
The way you keep up with your network greatly impacts your potential income. It is vital to follow up with recent customers, know how they are settling in. Send out emails, personalized notes and birthday cards. Use Facebook to maintain relationships. Dropping a note to old clients and asking how they are doing is a quiet gesture that would only take a minute or two, but can pay huge dividends in the long run. Each contact you make is valuable. When you lose a contact, you lose your prospects, potential leads, and potential customers.
Source: This article is contributed by Lecel, a Hoppler broker.
Sometimes a team can accomplish far more than a group of lone individuals. For example, cyclists in the Tour de France take turns riding at the front of their group, decreasing the wind for those behind them. Wolves hunt in packs to take down animals 20 times their size. And for those of us who were children of the '90s, we all remember Ducks Fly Together.
Related: 8 ways real estate is your smartest investment
This brings up another team that can accomplish amazing things – not a team of people, but a team of benefits which, when combined, can help you achieve your greatest financial goals. Specifically, I want to talk about real estate.
I’m a real estate investor, and I firmly believe that real estate is the best traditional investment on Planet Earth today. However, just because you buy a piece of real estate doesn't mean you're going to make money.
As I explain in The Book on Rental Property Investing, big wealth is built through real estate investing by capitalizing on something I call "the four wealth generators of real estate." Alone, each of these benefits can help you make more money, but together they'll make you rich.
1. Cash flow
Cash flow is the extra profit left over after all of the expenses have been paid on a property. For example, if my rental property produced $2,000 in income and my expenses came to $1,700, my cash flow would be $300 that month.
Now, I know a lot of you are saying, "Three hundred dollars is not going to make me a millionaire." Probably not. But remember, we are just talking about one of the wealth generators. There are still three more to go!
Additionally, that $300 might be from just one property. If I owned 10 similar units with the same cash flow, that's $3,000 per month. If I owned 100 units, that's $30,000 per month. This cash flow can go a long way toward helping you quit your job – or helping you save for a future big purchase, or retire wealthier.
When I talk about appreciation, I am not referring to how much I like you (though I do appreciate you!). I'm referring to the natural rise in value that real estate experiences. For example, if you purchased a property for $200,000 10 years ago, and today that property is worth $300,000, the appreciation made you $100,000 richer!
Of course, appreciation doesn't cause values to increase every year (consider 2007!). However, historically, real estate prices have appreciated over the long term. So, again, appreciation alone is not likely going to make you a millionaire, which is why I don't recommend that people purchase bad deals hoping that appreciation bails them out.
However, appreciation is combined with the other "members" of the wealth generation team, powerful stuff can happen.
Related: 6 advantages of real estate investing for savvy entrepreneurs
3. The loan pay-down
When you purchase a rental property with a mortgage, each month you make a payment to the lender. That payment includes two parts: principal and interest. Interest is the profit for the lender, but the principal is money you are paying down the loan with.
For example, if you purchased a house five years ago for $100,000 and obtained a $80,000 mortgage (we’ll say it was a 30-year mortgage with a 5% fixed rate), today you would owe only $74,000. Ten years from now, you would owe only $65,000. This means that every year your equity increased (equity is the difference between what a property is worth and what is owed on it), you'd gain value, as long as the property value didn't drop.
Of course, if you paid all-cash for a property and didn't obtain a loan, you would forfeit this wealth generator. This is something only you can decide.
4. Tax benefits
Finally, the fourth wealth generator in real estate is the tax benefits the US government gives to investors. These benefits are numerous and realized in several distinct parts of the real estate process.
Of course, I'm not a CPA (certified public accountant), so you should definitely consult with one before making any financial or tax decisions.
Putting it all together: an example
As I mentioned, each of these wealth generators can be powerful in itself. However, putting the four together can make you exceedingly wealthy because of the synergy among them.
For example, you might purchase $1,000,000 worth of multifamily real estate with a $200,000 down payment. Let's assume this property produced $30,000 per year in cash flow, but it also might be increasing in value at 5% per year. This means that after 10 years, it could be worth $1.6 million, and you would have earned another $300,000 in cash flow.
On top of that, after those 10 years, that initial property could be paid down so that you owe only $650,000, giving you $1 million in net worth on that one property alone.
And to top it all off, the tax benefits during that decade would help you keep far more of that profit than had you earned it any other way.
Real estate is not the only way to get rich today, but it certainly is a simple one to understand, thanks to the four wealth generators of real estate.
Now that's a team I want to be a part of.
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This article originally appeared on Entrepreneur.com. Minor edits have been done by the Entrepreneur.com.ph editors.
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