How Much Does Buying and Selling A House Cost?

Real estate is a time-tested investment vehicle, and it is estimated that up to 90% of millionaires in the last 100 years made their wealth the industry. There are several businesses in real estate that one can get into: construction, rentals and buying and selling. And among the three the last is the easiest to get into as it requires the least amount of capital and technical know-how.

Buying and selling a house can be a profitable venture. Credit: Sam Beasley

With a house bought at PHP 300,000, buying and selling it can cost up to PHP 116,000 pesos – a total outlay of PHP 416,000 when the buying price of the house is included. As with any other buy and sell business, the cost depends on how savvy you are at keeping other costs low. As you know the lower cost of buying a house the higher is your profit after deducting expenses such as repairs, processing and document fees, and marketing costs.

For a detailed breakdown and illustration of buying and selling a house costing, as well as strategies to buy properties low and sell them at higher margins, read on.

Documentary Stamp Tax (1.5% of selling price)PHP 4,500
Transfer Tax (0.5% to 0.75% of selling price, fair market value or zonal value – whichever higher)2,250
Title Registration Fee (0.75% of selling price)2,250
Notarial Fee, Admin Fee and other incidental expensesPHP 6,000
Total (Including price of property)PHP 15,000
Table 1: Breakdown of Costs When Buying A House in the Philippines

The table above illustrates the costs associated with buying a house in the Philippines, with a selling price of PHP 300,000. Most of the fees above are based on the selling price, fair market or zonal value of the property. Notarial fees can be as high as 2% based on standard rates provided by the integrated bar of the Philippines.

Broker’s Fee (up to 5%)PHP 30,000
Capital Gains (6% of selling price, fair market value or zonal value)36,000
Cost of Repairs (varies greatly – price indicated for illustration)30,000
Marketing costPHP 5,000
TotalPHP 101,000
Table 2: Breakdown of Costs When Selling A House in the Philippines

For the sake of illustration we assume that land and property values have increased 100% since the property was bought. This would mean the new selling price is PHP 600,000 and will be the basis of capital gains tax and broker’s fee. Note that registered real estate brokers can charge as high as 5%.

And so with a house originally bought at PHP 300,000 the total cost of buying and selling would be PHP 116,000 – PHP 416,000 if the buying price of the house is included.

Where To Look For Houses At Bargain Prices, Which You Can Sell Later On

You might comment that PHP 300,000 is too low for a property in the Philippines unless it is high up in the mountains or deep in the jungles of Mindanao. But this buying price is actually realistic, if you know where to hunt for bargains.

There are several ways to look for houses at bargain prices and sell them later on at a profit, some methods are more traditional have been the practice of seasoned real estate buyers while some are more unconventional.

Experts at buying properties go to city halls or municipal capitol buildings and attend auction hearings inside courtrooms, where one can snatch up properties at bargain prices. With this method, it pays to do due diligence as you don’t want to give an offer to a property riddled with illegal settlers or a property with questionable lot measurement.

Pick a neighborhood and slip in flyers that say something like “Sell Your House & Get Spot Cash” into the mailbox of every house. This method involves brute force and is actually hit or miss, but you may actually get good bargains especially from those residents thinking of migrating, downsizing, etc.

Assume balance or Pasalo groups on Facebook are not only for cars, they are also for individuals who took out loans or payment plans for condo, townhouse, and house and lot properties, and are in a financial pinch. These individuals would like to give up monthly payments as well as the rights to their property, but would also like to liquidate the payments they’ve made previously.

Club houses and admin offices in exclusive villages and condominiums post notices in their bulletin boards about owners who have missed payments on association dues. Delinquencies on these dues are indicative that the owner has lost interest on his property, or is in a bad financial situation, and may be open to selling their property at an attractive price.

Posting ads on Facebook and Google and targeting people living in specific area is a digital version of flyering. The advantage here is one doesn’t have to physically go to each house and hand out printed materials, and you can cover several neighborhoods at one time.

Cost of Repairs

Repairs are necessary for every buy and sell project, but the costs may vary. For some, a property may only require a fresh coat of paint while some may need new electrical wirings, repair of plumbing, replacement of roof and others.

In repairing a house for buy and sell, a contractor is usually your main contact if you have no personal contacts with an electrician, painter and other laborers. Obviously you should do business with a reliable contractor as these businesses are notorious for shortchanging their customers.

Processing Fees

The cost of processing fees in a real estate business is mostly dependent on the selling price, fair market value or zonal value as illustrated in the tables above.

When dealing with government offices, note that it also pays to keep in mind these tips:

  • Do not hire fixers as those may run with your money and will cost you more in the long run
  • It pays to have friendly connections in government offices to follow up on your documents
  • If it seems complicated to you, you can hire firms who can do this for you initially
  • You can then study the process and do it on your own later to lower your costs

Marketing Costs

Competition in the real estate industry has become competitive throughout the years. Evidence of this is the thousands of property listings in online portals. Checking Youtube one almost always stumble into video walkthroughs of properties by real estate agents.

The key then is to stand out, and they way to do it is to establish a three-pronged marketing approach:

  1. Create a website that can attract organic leads, which are people searching for properties on search engines. It will take some time before your website attracts a good amount traffic, but regular updating and keeping a blog that discusses real estate FAQs and related topics makes a good investment.
  2. List your properties on platforms such as Lamudi, DotProperty and Carousell as these provide a good amount of traffic and leads. Plus, ad listings are mostly free in these sites.
  3. Don’t be afraid to spend on Google and Facebook ads to get leads, these can help you stand out in the “noisy” property market. Users from these ads can be directed to your site, which can collect vital lead information such as name, phone number, and property they are looking for.


While fees paid to government offices and notaries are non negotiable, the remaining costs of buying and selling a house can be as low as you want it to be, depending on your creativity, business savvy and willingness to stand out.

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