The Big Jump

It was 9:48pm and I’m in front of a Bloomberg Terminal in my office…alone…on a Sunday. A few years back, I was a financial analyst of a local bank. During that time, I’d normally spend 13 hours a day in the office—not including the weekends.


Despite being rewarded well (in local bank terms), I came to the point where I wanted more. See, I dreamt big; and I mean BIG. Problem is, I didn’t know what I wanted exactly (though the usual dreams such as living in a mansion, driving a sports car, affording ivy league education for my kids did sound really enticing.) I was willing to sacrifice time, if it meant getting what I want. So there I was, thinking of what route to take. Eventually, I was convinced that boxing it out with ex-pats and playing politics was a dead end. So what’s next?


Whenever things bothered me, I think out loud in front of friends, hoping I’d get suggestions on how to solve problems. A few months later, I bumped into an old friend of mine who, after a long conversation, invited me to join his venture of putting up a real estate brokerage firm.


Initially I thought, I didn’t know much about real estate only that land prices were soaring in Manila and that developers were making a killing. Moreover, I never thought of myself as a salesperson. Actually, I hated talking to strangers (except when there’s liquid confidence, AKA alcohol). What attracted me though is the financial success brokers achieved. I heard (and verified) stories of how some of my broker friends were earning millions (north of Php5 Mn–net) a year! Consistently! That’s a full blown salary of local firm’s CEO! Some of them were even younger than me; people who even barely passed school! I thought if they could do it, so could a person who worked long hours and had a corporate background such as myself. Should be a walk in the park. Or so I thought.


And boy was I wrong.


Six months down from the time I became a real estate broker, I haven’t closed a single deal. I was living on my credit card, paying the minimum amount possible. I didn’t want to run to my dad for money (though I did a few times; thanks dad!) especially since I was in my 30s. I started to feel desperate. I worked on  Php11,000-a-month leases just to get by. There were times when I thought about going back to the corporate world where things may not be as exciting but provided a regular paycheck. The company we put up wasn’t going well either. We were running on fumes and we were scrambling to find ways to pay for rent.


Apparently, being a real estate broker or putting up a business wasn’t as simple as I thought. No, real estate brokerage was never rocket science (not anywhere as complex as financial derivatives). Real estate, however, requires a whole different skill set: patience, perseverance, humility. As my partner puts it, “this ain’t a job for the weak.” I never understood what he meant up until I was down.


Just to give you an idea of what I had to deal with:


Imagine dealing with government officials who claim, “o expired na yung SPA mo dahil two years ago pa yan!”  To which you reply in a VERY nice manner, “Ma’am, saan po naka lagay sa batas na nag e-ex-pire yung SPA?” And to which she answers in a very condescending tone, “Saan nakalagay sa batas na hindi nag-e-expire?”


Or the time when you thought you have a done deal since the seller accepted an offer but changed his mind, come signing day. Or your buyer backs out from a deal (which is very normal). The industry and the income was UNPREDICTABLE!


When you’re broke, have bills to pay, and not getting any younger, you’ll start to question everything. You’d be so lost you start to lose confidence.
How can I provide for a family when I can’t even afford to pay for myself?
How can I afford to go on a date or should I even try to “settle down”??
What happened to the MBA I took???


I felt lost; a failure. I reached the point where liquor no longer helps. I’d down a sleeping pill just to help me forget about my problems and fight another day. Sometimes, I  wished unfortunate things to happen just to make everything stop.


At the peak of my depression, a small deal closed (the ice-breaker). Two weeks later, another closed. Then another. And then a fat one.


Just like that, I was able to zero my credit card bill, pay back my dad and gain the self-confidence I lost.


Our real estate firm was somewhat a different story. While I recovered financially, our small company kept bleeding money. I seriously couldn’t get it. I applied everything I learned from graduate studies from Switzerland! Sales Force Management, Human Resource Management, Strategy, etc. We had to infuse additional capital to keep the company afloat.


During the dark hours, you can’t help but blame other people for things not working out. Heck, I even thought about leaving and just practice brokerage by myself, otherwise I’m going to end up broke infusing capital and continue to burn relationships!


I don’t want this article to sound dramatic, but honest to goodness—the one thing that kept me from leaving were the people behind me. If you take time to get to know the people around you, you’d be saddened by the stark realities of life. But here we were, providing livelihood to our employees, helping aspiring brokers get out of the same situations we were in! We were building something! Something positive!


And just as with the success of my new endeavor, the company began to shape up a few months later. Our associates went through the same ordeal until they landed deals; and then some big ones. Later on, we got more people to join the bandwagon. The business model was finally working. Three years from when we started the business, we achieved a LOT. At this time, we knew we were doing something right. I realized that business plans took time to work.


Just like in any business, the ebbs and flows are natural. The entrepreneurial path is a roller coaster ride: you think everything’s all well and dandy and then (BOOM!) another sink-or-swim problem comes by. The pictures that come out in social media or newspapers is never a testimony to life achievements. They are for the small successes.


On the financial aspect of things, I’m definitely earning more than my corporate job (even with the bonuses). I’m happy that, despite the problems I encounter, the sleepless nights, the drama, I know we’re on to something great. This is when I realized that it was never the fancy things that were going to make me happy. It was the “building-something” part—the feeling of building something and seeing it work; the joy that comes with having happy employees and associates; the shared success that is being celebrated with people who are happy for the group’s success; and the assurance that the success resonated even to the lowest people in the company.


After everything’s been said and done, I’m happier where I am now.


My dream is for our firm, RE/MAX Capital, to grow to more than a hundred agent strong; to unite a fragmented industry; to professionalize an industry coined to be the “Wild-Wild West”. We have a long way ahead of us, and we’ll need all the help we can get.


To those who want to earn more but can’t afford to leave their corporate jobs, RE/MAX Capital, offers a program that can earn you as much as 20% referral fee. That’s 10% more than the industry average. This is especially beneficial to those who have relatives buying properties left and right. Or those who are well connected with people who invests in real estate.


To those who are willing to take the big leap and jump to a promising industry, let’s talk and explore options.


To those planning to do real estate brokerage alone, ask yourself an honest question: which do you think people would trust more: a broker backed up by a successful global brand or a broker with none?


If any of these criteria fit you or if you were simply inspired and sparked by my curious mind, let’s sit down and talk about options.


Juan Patag
PRC Reg. No. 23114
RE/MAX Capital
7th Floor, 8 Rockwell, Hidalgo Drive, Rockwell Center, Makati
M: 0917 520-5826


Ntoe: Special thanks to my friend, Katrina Calderon, for proof reading this article. 🙂



DISCLAIMER: This material, which is strictly for information purposes only. The views and opinions expressed in this article are those of Juan Patag’s and do not necessarily reflect the position of RE/MAX Capital, any other RE/MAX franchise, or of Rockwell Land. Any information is subject to change without prior notice. No liability whatsoever is accepted for any loss that may arise (whether direct or consequential) from any use of the information contained herein. Information Each RE/MAX franchise is independently owned and operated.
Published: December 4, 2017
Okay, we’ve been hearing rumors that the Capital Gains Tax (CGT) would be increased from 6% to 20% in the new Tax Reform Program of the government. They say this will be effective January 2018. While contacts in Regulators’ Offices claimed that this is a rumor, we’re surprised that even our clients heard about this. So let’s analyze what happens if they do decide to push through with this reform:

1. If CGT were increased to 20%, property owners would be better off putting all properties in a company where owners would just pay a total of 18% tax (12% VAT and 6% Creditable Withholding Tax [CWT]–both of which are deducted from the VAT-exclusive price, a lower base). Moreover, VAT and CWT can be offset by VAT-input and expenses. These give property owners the reason to put assets under a corporation.

2. In lieu of the previous insight, people would be setting up companies to put their properties in. Before, it took 2-3 months to setup a company; however SEC recently moved its office to Manila and I would assume this would make things slower as they adjust to the new office–4-6 months in my assumption. This would mean less secondary market sales in the following six months.

3. Given that sellers would get less proceeds (approximately 14% less from what they originally expected before the reform), they will make up for the decrease in proceeds by increasing the selling price. In effect, this would slow secondary market sales as less buyers can afford the higher prices. This would definitely greatly affect sales of secondary market properties in areas that have seen recent increase in zonal values (i.e. Makati).

4. Finally, what better way to avoid getting taxed by 14% more than by selling your property before the tax reform is implemented? It would be a natural decision for property owners to liquidate assets before the tax reform especially because, I believe, it would take a few years to recoup the expected loss (in case they choose to stick with their selling prices) if they had not sold their properties before. Prices in the Metro are already at their historical peaks (QC condo at Php145,000/sqm, Makati condos at Php330,000/sqm). It’s hard to imagine that the same amount of people would be willing to buy if prices increased even higher.

In sum:

Unlikely but possible. It is unlikely that legislators would pass this part of the reform (especially because I believe a lot of them own a significant amount of real estate). They would get affected in the process. However, history has proven that even the remote things may happen (minority winning the elections). Philippine politics is one of those uncertain things.

Price decline in the near future. We can’t undermine the fact that people will anticipate the possibility and act faster than the market. General prices would decline in the near future, especially in areas that have seen significant increases in value in recent years because they would want to take profit.

Invest in developing areas. With this amount of uncertainty, I would suggest investors to focus  or divert to their investments to developing areas which present higher capital appreciation potential where prices remain low and would be affected dramatically lesser since the tax bases are lower. Examples of which are Cavite and Nuvali.

Agree? Disagree? Would love to hear your thoughts. Email me at

A Commentary on Land Prices in High-End Villages


Just my two cents: General increase in land prices in prestigious villages mainly due to:

  • Prices shown in the graph are “highs”, average prices should be 10% to 15% lower.
  • Lots in these Makati villages are very rare. The low supply allows sellers demand exorbitant prices for their properties in these villages.
  • In the past 6/7 years, more people are entering the “ultra high net worth individual” space which in turn is attributed to bustling businesses/booming Philippine economy (it’s more common to see Ferraris and Lambos in recent years).
  • These are the people buying at those prices.
  • Optimism on Philippine economy have influenced the current ultra high net worth individuals to land bank.
  • What would be interesting to see is data prior to 2010. My guess is, the uptrend shown in the graph is also a recovery of prices from the dip in prices from the Global Financial Crisis back in 2006/2007.
  • Dip in prices in Green Meadows is due to the earthquake scare. Green Meadows is found near the fault line.
  • Increase in prices in Ayala Alabang due to the completion of Stage 2 (exit to Alabang’s South Station) back in April 2011.

Here’s the original article from Entrepreneur:

Disclaimer: This material, which is strictly for information purposes only. The views and opinions expressed in this article are those of Juan Patag’s and do not necessarily reflect the position of RE/MAX Capital, or any other RE/MAX franchise. Any information is subject to change without prior notice. No liability whatsoever is accepted for any loss that may arise (whether direct or consequential) from any use of the information contained herein. Information Each RE/MAX franchise is independently owned and operated.