Why Hire A Professional Property Management Company

IMG 9996 Why Hire A Professional Property Management Company

If you lack the time or expertise needed for day-to-day management of your commercial or residential real estate investments, an expert property manager can help you.

A property management company can help you:

  • Market your rental property to minimize vacancies and maximize income (link: Property managers make their livings because they know the rental market, what comparable properties are renting for, and what potential renters are willing to pay for a rental property. They have the marketing know-how to reach potential renters and they have the experience and resources to weed out potential bad renters);
  • Fill vacancies with the best possible tenants;
  • Maintain and keep your rental property in good condition (link: Property managers handle and coordinate routine repairs as well as emergency repairs. They have the experience to avoid unnecessary repairs to save you money);
  • Track income and expenses to determine profitability;
  • Negotiate rental agreements;
  • Collect rent and track tenant deposits;
  • Comply with federal, state and local laws; and
  • Respond to tenant requests and deal with problem tenants

In short, property managers help you make the most from your rental property and they can save you time.

Out of State Property Manager. A local property manager can keep an eye on your rental property to make sure that the tenants are taking good care of it. Local property managers tend to find problems sooner and correct them more efficiently. In addition, local property managers often have contractors they work with and trust for various repair jobs, which can save rental property owners money and time.

Find and Keep Good Tenants. Often, good tenants will rent only through a reputable property manager because everything from initially viewing the property, to negotiating and signing the lease agreement, to dealing with maintenance and repairs, to making rental payments is more efficient and streamlined if a professional company located in the area is coordinating providing the service.

Avoid Bad Tenants. Typically bad tenants will target owner-managed rentals because they can’t pass muster with property managers. They know that when a property is for rent by owner the rent will be less and there will be less scrutiny of their financial situation. Because bad tenants can’t be evicted without notice and an eviction can take months and cost you money, property managers will track references and do their utmost to avoid potential bad tenants and associated eviction problems.

“Tripping”. Yes. While it may be inconvenient for you to take time to show your property, and to deal with potential renters who may not show up for their appointments, it is a property manager’s job to respond quickly to requests from potential renters to view a property and property managers can also pre-screen potential tenants.

Administrative and Financial Property Management. Yes. Generally, property managers and real estate managers handle the financial operations of the property, ensuring that rent is collected and that mortgages, taxes, insurance premiums, payroll, and maintenance bills are paid on time. In community associations, although homeowners pay no rent and pay their own real estate taxes and mortgages, community association managers must collect association dues. Some property managers, called asset property managers, supervise the preparation of financial statements and periodically report to the owners on the status of the property, occupancy rates, dates of lease expirations, and other matters.

See also: What is a Deed of Sale

How a Foreigner Can Engage in Retail Trade in the Philippines

Can a foreigner engage in retail trade in the Philippines? The simple answer is YES but the requirements are not as simple.

Every day we get several inquiries from foreigners who came to the Philippines to introduce their businesses abroad locally. We have foreigner clients selling pharmaceuticals, cosmetics, religious items from the Dead Sea, and various other products.

They have the capital. They have the source. And they have the marketing know-how. Philippine laws, however, has set certain limitations before these foreigners can engage in retail business.

With good reason, retail trade is reserved to Filipinos. Filipinos who do not have as much capital as these foreigners have will be deprived of earning their living off their sari-sari stores.

The Bureau of Immigration has repeatedly warned foreigners to not engage in retail trade without satisfying the requirements, lest they be arrested or deported for violation retail trade and immigration laws. (December 2012, BID Bulletin)

When is a business a RETAIL business?

If one is habitually selling merchandise, commodities or goods for consumption to the general public, then he or she is engaged in a retail business as defined by law.

What is the requirement before a foreigner can engage in retail trade?

The foreigner or the corporation with a foreign equity must have a capital of not less than Two million five hundred thousand US dollars (US$2,500,000.00).

Are all retail businesses covered by the Retail Trade Liberalization Law?

Not all retain businesses are covered. There are exceptions where foreign ownership is allowed.

For one, sales by a manufacturer of products manufactured by him, when his capital does not exceed One hundred thousand pesos (P100,000.00), is not considered retail trade.  The same is true with a farmer selling the products of his farm. Sales in restaurant operations by a hotel owner or inn-keeper, irrespective of the amount of capital, where the restaurant is incidental to the hotel business, is also exempt. Finally, sales which are limited only to products manufactured, processed or assembled by a manufacturer through a single outlet, irrespective of capitalization, are likewise outside the coverage of the Retail Trade Liberalization Law.

If the foreigner has Two million five hundred thousand US dollars (US$2,500,000.00) capitalization, can the business be wholly foreign-owned?

If the capitalization is at least 2.5 Million dollars but not more than 7.5 Million dollars, the foreigner can own up to sixty percent (60%) of the business. If the capitalization is at least seven million five hundred dollars, then it can be wholly foreign-owned.

Also, enterprises specializing in high-end or luxury products with a paid -up capital of the equivalent in Philippine Pesos of Two hundred fifty thousand US dollars (US$250,000.00) per store may be wholly owned by foreigners.

Is the foreigner required to keep the amount of capitalization in a Philippine bank?

While the foreign investor shall be required to maintain in the Philippines the full amount of the prescribed minimum capital, it is not required to be kept in the bank. It is required to be actually used in their operations in the Philippines. Actual use of the funds will be monitored by the Securities and Exchange Commission.

So if you are a foreigner who wish to engage in retail trade in the Philippines, identify your product and your capitalization and allow us to assess your qualifications. If you want to know more about doing business in the Philippines, contact us at +632-8231090 or email Atty. Joyce Domingo at ajd.prime@gmail.com.