Transform with technology: Shaping the future of real estate

JLL’s first global report on the rapidly evolving real estate technology landscape.

The pandemic has provided us with an unparalleled opportunity, even a necessity, to rethink the built environment. The technologies that are now available – and others in the process of being developed – are set to radically reshape how we construct, interact with and use buildings.

The increasing deployment of technologies, from connectivity and hardware advances enabling the mass use of sensors to machine learning and artificial intelligence, now mean that nearly every aspect of the property industry has the capacity to evolve more quickly than ever before.

As the real estate industry rises to the challenge of delivering a significantly decarbonized built environment, technology is likely to be the single biggest catalyst for green progress.

Technology will also be essential as we seek to better manage space and its impact on people. Now more than ever, the health and well-being of the workforce are paramount to business success.

The new workplace, aided by technology, calls for more effective and dynamic use of space. This presents immense opportunity, but the proliferation of new technologies, new companies and new operating models has made it difficult to navigate the shifting landscape.

There is so much technology out there that businesses are often left overwhelmed. Where and when does a business start to invest in new technology and how do they know which area to prioritize?

This report aims to help organizations navigate the complexities of the proptech landscape and provide a strategic technology road map, so that firms can capitalize on those tech investments that will increase the value and benefit of buildings and the happiness of those who occupy them.

Transform with technology

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Source: JLL

Can You Get Your Down Payment Back On A House?

A lot of Filipinos are buying real estate properties in the Philippines, like condos, townhouses or residential homes, as vacation houses or for investment purposes.

Most of these purchases are financed either by a bank or the seller, and the buyer pays on an installment basis for a period of 10 to 30 years, depending on the value of the property and the terms of the loan.

Sometimes, however, there are unavoidable situations where the buyer is unable to continue making the monthly payments on the loan. In such case, the seller or lender can cancel the sale contract or foreclose the mortgage on the property.

Luckily for the buyer, there is a Philippine law that protects him or her in case of default in making installment payments. Under the Realty Installment Buyer Act (Republic Act No. 6552) or the Maceda Law, a buyer of real estate property on an installment basis has the following rights:

1. Right to a grace period to pay the installments due. If the buyer has paid at least two years of installment, the buyer has a grace period of 30 days for every year of installment payments made; if only less than two years installment payments have been made, the buyer has 60 days from the date the installment became due.

2. Right to a 30-day notice of cancellation. If the buyer is unable to pay the installment due within the grace period, the sale contract will only be canceled after 30 days from receipt by the buyer of a written notice of cancellation or a notarized demand for rescission of the contract.

3. Right to refund of payments made. Under Section 3(b) of the law, if the contract is canceled or rescinded, the buyer is entitled to a fifty per cent refund of payments made, if buyer has already paid at least two years of installment. The refund percentage is increased to five percent for every year after five years of installment payments made, up to a maximum of ninety per cent. The down payment, deposit or option payment on the contract are included in the computation of the total installment payments made.

It is common practice among sellers to impose penalties, charges or other fees if the contract is canceled or rescinded and to deduct these from the refund amount, thereby leaving the buyer with a smaller refund.

This practice is of doubtful legality because the law expressly states that any stipulation in a contract that is contrary to the foregoing rights shall be void. Since the deductions would reduce the refund amount to less than fifty or more per cent (depending on the length of payments) of the installment payments made, this would contravene Section 3(b).

The realty installment buyer can also sell or assign his or her right under the contract before it is cancelled. And if he or she pays the whole balance in advance, no interest shall accrue on such unpaid balance.

Duterte Administration Builds Resilient, Decent Houses

Filipinos deserve not just better, but the best social services from the government.

The Department of Human Settlements and Urban Development (DHSUD) is bent on delivering quality service as Secretary Eduardo del Rosario vowed to provide low-cost housing projects for all Filipinos.

"Despite some birth pains, we have started laying solid foundations for the future of housing in our country," he said in an interview on Friday.

Del Rosario said it is crucial that President Rodrigo Duterte supports access to decent, safe, and affordable housing units in sustainable communities for the underprivileged and homeless.

Signed into law by Duterte on Feb. 14, 2019, DHSUD was created under Republic Act 11201 and was tasked to establish Housing One-Stop Processing Centers in regions to centralize the processing of housing-related documents.

Despite the challenges, the department strives to exercise its mandate under the Duterte administration’s flagship program Building Adequate, Livable, Affordable, and Inclusive Filipino communities (BALAI).

"The program aims to improve government efforts in addressing Filipino housing needs as well as to engage in the private sector. As chairman, I believe that we should all take the same stand and look in the same direction guided by BALAI Filipino," he said.

The DHSUD, along with its key shelter agencies (KSAs) -- the Home Development Mutual Fund (Pag-IBIG Fund), National Housing Authority (NHA), Social Housing Finance Corporation, and the National Home Mortgage Finance Corporation -- in coordination with the Human Settlements Adjudication Commission, formulated a national strategy to ensure the alignment of housing policies, programs, and projects.

"In keeping President Duterte's directive under the country's development goals, we want every Filipino, regardless of their social status ay magkaroon ng disenteng bubong na masisilungan, bahay na may maayos na kuryente at tubig (to have decent shelter and complete with electricity and water supply), a house that they can call their own and can be proud of," del Rosario said.

Del Rosario made sure all houses are in safe communities and "not prone to calamities or disaster".

Since its establishment, DHSUD has implemented policies, plans, and regulations related to land use and the creation of housing and development of homeowners’ associations (HOAs).

Services amid pandemic

Despite the Covid-19 pandemic, the DHSUD and its KSAs continued their work "so that the creation of their new department would be brought into purpose."

In 2020, the NHA provided 115,132 units, focusing on the needs of the low-income bracket and underprivileged households in urban areas.

Pag-IBIG Fund, meanwhile, boasts an all-time high financial statement in 2020 with PHP31.13 billion savings and PHP63.75 billion loan takeout, enabling a 93.68 percent basis of dividends for its members.

The DHSUD has facilitated the accreditation of 29 socialized housing projects and the approval of escrow agreements of 50 main condominium and subdivision projects.

As the pandemic rages on, DHSUD has a policy on loan moratoriums in housing finance and movement of deadlines and interruptions of periods for compliance with requirements, benefitting more than 5.5 million members.

The DHSUD also allowed the resumption of real estate activities, provided that strict health protocols must be observed.

Over 55,000 workers have returned to work and the construction of more than 400,000 housing units has resumed.

Local partnership

Del Rosario cited the huge contribution of local government units (LGUs) in the effective implementation of housing plans.

Work continued even amid the pandemic, with seven housing projects unveiled in December last year.

Memoranda of agreements (MOAs) with LGUs likewise paved the way for the construction of more housing projects and resettlement sites for informal settler families (ISFs) nationwide.

"These pacts are testament to President Duterte’s commitment in providing affordable and decent housing to underprivileged Filipino families and by establishing a strong bond with LGUs, DHSUD will succeed in reaching out and helping the majority of Filipinos who wish to have a house of their own," the housing czar said.

Del Rosario is eyeing to sign over 50 similar MOAs this year.

Beneficial partnership

The housing department also entered into partnerships with other government line agencies to boost various programs

Among these are deals are with the Homeowners Associations Federations and Confederations and the Department of Interior and Local Government (DILG); and the creation of a technical working group that will institutionalize the department's efforts to run after illegal developers and bogus brokers engaged in the illegal selling of real estate properties, through a joint MOA on anti-illegal real estate practices.

There were followed by the creation of the Anti-Illegal Real Estate Practices Inter-Agency Task Force, composed of the DILG, Philippine National Police, Department of Justice, National Bureau of Investigation, Land Registration Authority, Department of Environment and Natural Resources, and the Professional Regulation Commission, to push for an intensified whole-of-government approach against real estate scammers and illegal brokers.

Together with the Department of Agrarian Reform, the DHSUD rolled out housing projects for farmers, starting in Umingan, Pangasinan.

The agency and the Department of Transportation made sure ISFs hit by the ongoing North-South Extension Railway Project would be relocated properly.

To ramp up disaster risk management and climate adaptation efforts within localities, DHSUD has prescribed the land use planning and zoning standards for the formulation of Comprehensive Land Use Plans and Zoning Ordinances for local governments.

It has also partnered with various agencies to operationalize its mission on disaster preparedness and response, including the Covid-19 pandemic, Taal Volcano eruption, and the landslide incident in Naga, Cebu.

20-year housing roadmap

To sustain the initial efforts of the housing sector, DHSUD created a 20-year housing and urban development strategic roadmap dubbed “Sustainable Housing and Well-planned Community for all Filipinos” which aims to provide adequate and affordable houses for Filipinos.

Del Rosario said it will cover strategic plans and programs until the 2040, which is aligned with the "AmBisyon Natin 2040" development plan of the National Economic Development Authority, both representing the long-term vision and aspirations of Filipinos.

The national housing strategic plan, he added, is intended to accelerate the building of high-quality but affordable housing projects, in partnership with the private sector.

It also resolves the immediate housing needs of all ISFs.

Del Rosario said the 20-year strategic roadmap will ensure continuity of housing projects and urban development programs in the country beyond this year.

"The roadmap envisions better, greener, and smarter human settlements and urban systems in the Philippines with banner projects aiming to create spaces, transform spaces into communities, make communities accessible, and for affordable and empowered communities," del Rosario said.

Source: PNA