Transaction friction

Transaction friction — the all-in statutory cost of selling PH real property: 6% CGT (or CWT on dealer/bank sales) on the highest of price, zonal, or assessed FMV — charged even at a loss — plus 1.5% DST, ~0.5–0.75% LGU transfer tax, and registration fees: ~8–9% per sale, before any broker’s 3–5%. The consequence the course hammers: a property must appreciate ~9% just to break even on exit, which is why cosmetic flips die, “I’ll just sell” isn’t a plan, and every IRR in your template prices exits net.

First used in: 3.8 · Titles, diligence, and friction