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Why the Hell Would You Buy Property in the Philippines – Documents Required

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Part 1

Part 2

Part 3

Part 4

Part 5

Part 6

Part 7

We have often been asked over the last year what documentation is required to purchase a lot in the Philippines. Thanks to Janet’s organisational efforts, these are the requirements we asked from the seller before we gave any money to them:

  1. Original title (check @ Registry of Deeds) if it is authentic and if the seller is the actual owner of the property.
  2. 2020 Tax Declaration.
  3. 2020 Tax Clearance (has the tax been paid). 1, 2, and 3 should match.
  4. Location plan/vicinity map/sketch plan (we recommend asking the seller to re-survey the lot in your presence).
  5. Subdivision survey if the lot is subdivided (ex., common lot).
  6. Sworn Declaration of No Improvements issued by City/Municipal Assesor (meaning the lot has no building or permanent fence )
  7. Seller(s) Tax Identification Number (photocopy of the ID is better)
  8. At least 1 Gov’t photo ID of the seller(s) (photocopy)
  9. Notarized Special Power of Attorney – if the person signing the Deed Of Sale is not the actual owner as it appears on the title (we never considered this option – too risky) but it can be done.
  10. Certificate of Philippines Consulate if the SPA is excuted abroad.
  11. Does the lot have direct access to the main/barangay road? If not , 11A.) Have a notarized Right of Way Agreement (from the front lot owner) saying that the road is donated or you have the full right to use it and the actual size in meters. 11B.) If it has an existing right of way already (check at the Assesor’s office if it is legit & recorded)
  12. If it’s a house and lot – you need to have the original blue prints of the house.
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Additional:

If you have all these and checked their authenticity then next is the payment; who pays what depends on what you agreed/negotiated.

Drafting of the Deed of Sale: Lawyers fees (often a percentage of the sale) are open to negotiation.

Capital Gain Tax is 6% of the sale price or the market value whichever is higher. Documentary Stamp Tax is 1.5% of the same value.

Transfer Tax Fee.

There’s more little stuff but the most important items are listed above.

Addendum: Many Filipinos do not have an Original Title to their property and will in all likelihood never get one. In fact many expats who buy property are in the same circumstances. Nonetheless many of these people build houses and live there happily. This was not for us. Our goal was to have a lot with an Original Title. Therefore the above list was what we considered necessary to transfer the title.

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Our Trip to Vietnam – From Grab to Grab Ass

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We hadn’t traveled out of the Philippines in nearly a year and that was to the US to see family; so it sort of doesn’t count. Since the house was finished, the house blessing done, the shop done, lawn installed, etc. it seemed like a great time to get out of Dodge. I’d been to Vietnam eight years before (prior to marrying Janet) and had told her consistently that it was a place I wanted to take her. The following are some impressions.

Grab Not Cab: You’d think after years of Philippines experience we wouldn’t make the taxi cab mistake but we did. We arrived in Ho Chi Minh City late and took a metered cab. I had downloaded Grab the day before and set it up, but since I had never used it, I did the traditional and crappy taxi thing. Big mistake. When we arrived at our condo rental we couldn’t figure out what we owned the driver, who spoke barely a word of English. After 5 minutes of arguing it became clear that he wanted an astronomical amount that would have been higher than a NYC cab fare. I refused, pretending to be an idiot American (an easy pretend). We finally agree to less than half of what the meter said but about triple what I should have paid.

The next day we did our first Grab. What a revelation! Easy to use, the car arrived minutes later, I knew exactly what the fare would be, no cash was involved, I could choose to tip or not after the trip was over, and best of all no one had to speak any pesky English! We took Grab throughout the rest of our week and the only issue we had was traditional taxis stopping and trying to pick us up or even pretending that they were the Grab car; Grab tells you the license plate number so always pay attention to that. Now that we know how well it works any trip in Manila or Cebu will from now on be a Grab. If only they could set up Dumaguete’s trikes on Grab. What are the odds?

Japanese Steaks Are Small: One of the reasons we were traveling to Vietnam was to celebrate my birthday. The number’s too high to track, so don’t ask me what birthday it is. I looked up reviews and found a Japanese steak house on the 77th floor of Landmark 81, the tallest building in the city. This building was so tall that you had to take 3 elevators to get to the 77th floor – I kid you not. It took two elevators to get to the 78th floor and then they dropped you out the window one floor to get back to floor 77. Ok, that’s not true; you had to take another elevator to get down to floor 77. About halfway through this elevator excursion I realised that I hadn’t been this high up in a very long time and it scared the shit out of me. We reached the restaurant and were seated next to a window. I looked out and thought, ‘Why the hell did I come here?’ Janet, ever the positive wife asked “How tall was the World Trade Center?” The birthday celebration was not starting out the way I’d anticipated.

I ordered the famed Wagyu sirloin steak. Janet ordered salmon, which became a favourite of hers back in Portland. The salmon arrived first. It looked good but it was about 3/4 of the size of a business card. The steak arrived next. “Did I order from the appetiser menu?” I asked Janet. The steak was about the size of my iPhone (and thinner) and I have a 6S. Thank goodness we’d gotten a salad as well.

Both the steak and salmon were delicious but you know good taste only takes you so far when you finish in three bites.

‘Maybe we should get a dessert?’ I thought. Actually I thought, ‘Maybe I should get another steak,’ but at the prices I wasn’t gonna do that.

Darling Janet had, unbeknownst to me, asked about cake for my birthday. The lights to the entire restaurant were dimmed and the staff brought out the piece of cake and sang happy birthday. I was just thinking, ‘Is this enough to fill me up?’ I also was thinking based on the thimble sized salmon and iPhone sized steak, ‘What’s this cake costing me?’ Turned out to be complimentary; Janet had charmed them.

Bring Your Own Napkins: I liked Vietnamese food and we had many good experiences eating. One thing that was odd was that at many restaurants they provided you with damp wipes rather than napkins. At the end of the meal Janet examined the bill and asked the waiter about a particular charge. Yes it was for the wipes; they were charging about $.25/wipe and we’d both used a couple. WTF! From then on I made sure I was a one wipe guy.

The Virus and Masks: Lots of people in Vietnam wear face masks when they are out in public but the number seemed to increase as the week went on and the news about the Chinese Coronavirus got more dire. As I watched all the masks appalled, the cynic in me kicked in and I thought, ‘So you all think a $.01 piece of paper is gonna block a virus?’ Eventually even Janet went out and bought herself some face masks. It saddened me, all these masked faces. It reminded me of a Danny Boyle zombie movie. Perhaps it’s just my old age. Back in my childhood wearing a mask meant one of two things: you were either pretending to be the Lone Ranger or were robbing us .

By the time we got on our flight to head back to the Philippines I would estimate that 75% of the passengers on our flight (including Janet) were wearing masks. All the flight crew were masked. And not a single one of them looked like Clayton Moore.

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When we arrived in Manila there was technology for checking passengers temperature. This is the wonderful world we live in.

Crazy Drivers – Vietnam Style:

For those who think that the Philippines has the market cornered on crazy drivers, come to Vietnam. With 4 million motor bikes in Ho Chi Minh City, it’s the Wild Wild West. Bikes routinely drive on the sidewalks as pedestrians jump out of the way. But just as in the Philippines, within few days Janet and I got used to it. But be forewarned; a car or bike will absolutely not stop for a pedestrian.

Happy Ending and a Shoe Fetish:

In the middle of our week we wanted a massage. I had regaled Janet about stories of the wonderful massages I’d had in Vietnam eight years before. Unfortunately it was January 24th, New Years Eve in Vietnam and we found that most massage places were closed. The only open one nearby was in that high rise where we’d had dinner. We booked a time. The facility was the fanciest massage place I’d ever seen. The bathroom, with sauna, probably cost as much as my entire house. The massage that followed was decent but not the best we’d had. In fact the best we’d ever had, was a couple months ago in Bohol.

Still, we wanted another experience and so on the last day in Vietnam we walked though the downtown district and picked one of the dozens of massage places in that area. No reviews checked this time; no fancy bathrooms. They asked for cash upfront which I thought was odd, but it was cheap so why not. How bad could it be?

Janet and I were next to each other with a curtain drawn between us. My masseuse began and the massage, while not the best I’ve had, was not bad. As she massaged my legs she brushed up against the important stuff – a few times. Not the first time this has happened in a massage but it became clear with the frequency that this was not an accident. Massage styles are different in different countries and I wondered what Janet was experiencing. But soon, as often happens in a massage, I went into that half sleep state with eyes closed. Finally for some reason I opened my eyes and the massage lady pressed her finger to her lips to signal that I should shush. OK now I knew what was really being offered. I thought it took a lot of guts (or balls lol) to make such an offer as I lay next to my wife. I made a face and shook my head and the massage proceeded normally.

Afterwards, Janet sensed something was wrong, especially since the massage ladies didn’t leave as we are used to. They hung around straightening up the area as we dressed. “What happened?” she asked. “I’ll tell you later,” I said. “Let’s just get out of here.”

We left quickly and there were no tips given. Janet described her massage as “the worst.” We got out of the place and within ten feet a guy approached me and pointed to my shoe which had a tear in it. Coincidentally, he had a shoe repair kit and began miming that he would fix the shoe. We both yelled at him to stop and scurried across the street. We got into a restaurant and examined my shoe, which had obviously been cut from within the massage place. And then I described my massage experience to Janet. I may be explaining to Janet for quite a while lol.

BTW, I should be clear that despite the levity and a few odd occurrences we had a great time! We studied Vietnamese cooking, and learned about Vietnamese coffee. We also had a French bakery next door to our condo. Life is good!

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The Passing of a Friend

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Prologue: I first have to apologise to my wife, Janet. After the last couple of blog entries, which were serious and somewhat negative, she asked if my next entry could be more of my typical funny or irrelevant style and I happily agreed. But as you’ll see, this ain’t it.

Facebook and all social media are a weird amalgam of good and bad. One of the good things is that I have many many Facebook friends who I have never met in the “real” world. Most of them came my way via this very blog. Guys (a few ladies too) friended me because they liked my writing or humour or because they too were married to a Filipina, or had moved or were considering moving to the Philippines. More recently I got lots of friend request from guys who were interested in my house build.

One such friend was Alan Zaintz. He lived in Cebu and Florida and was married with a young child. We chatted online regularly, particularly the last few months. Of course we shared being Americans married to a Filipina. We also shared being Jewish; with names like Zaintz and Weisbord it was pretty obvious. There aren’t many Jewish expats here but I know a few.

As I say, the Facebook thing is weird. Is a guy a friend who I have never met? Anyway I thought he was a friend and so did Janet. He “liked” many of my posts on FB and commented often.

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This morning I found out that he passed away in Florida at the end of December. I don’t know the cause although in our conversations he implied that he was in excellent health.

Again, how do I feel about the death of a friend I only knew in cyberspace? In my case I feel as sad as I would if he were someone I knew here in Dumaguete.

And then of course my own fears kick in; those of mortality. Alan was actually two years younger than me. Janet reminded me to enjoy life now since there are no future guarantees. I ask you all to do the same.

I have nothing else profound to say. I can only ask you all to lift a glass today to the memory of my friend, Alan Zaintz.

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Dramaguete

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It’s the middle of the Christmas Holiday and we’ve survived happily. We had a very pleasant barbecue dinner with friends at our new house on Christmas Eve, then went to another friends’ house for general celebration and midnight fireworks. On Christmas we went to a friends’ house for a wonderful, traditional Christmas dinner.

It seems like the most consistent topic of conversation between the expats was the changing of Dumaguete into Dramaguete. I was told from the start before moving to the Philippines that one of the biggest challenges I would face was not about getting along with Filipinos, but about dealing with the other expats.

Depending on who you listen to, Dumaguete has somewhere between 3000-5000 expats living here. I’m not talking about the tourists but the actual residents. Most are retired and therefore skew older. Most live on a pension of some sort. Most struggle to find meaningful things to do. And some (a few?) are pains in the ass.

Keyboard warriors dominate the FB groups and internet forums. Dare to say something positive about Dumaguete or its people, and you’re likely to be shouted down. Go to any expat gathering at your local watering hole and you’re likely to hear stories about fellow expats; who isn’t talking to who, who is suing who, or even who’s banging who’s wife or gf.

If I go into the local Robinsons or a bank, store or government office and I hear a loud commotion caused by a pissed off guy, I don’t even have to turn my head; I know it’s a foreigner.

Janet and I have only lived in Duma for 2 1/2 years, so we are far from experts. But whenever we go out, at some point we turn to each other, laugh and say, “Too many foreigners.”

Now some of this is human nature. In 1974 I moved to Portland, Oregon. From that point in the 70s to the present day, Portland has taken in a huge influx of people from all over the United States. After living there about ten years I viewed myself as a native and was mildly resentful of all the influx of Californians; “Californicating Oregon,” we called it.

It’s sort of become the same here. Whenever I hear the aforementioned expats yelling in public my ungenerous reaction is that I wish they would leave “my city.” Janet is more blunt. “They should get the fuck out.” As I say our view now that we have made Dumaguete home, is that that those that cause problems, yell and scream, or get drunk at 9:00AM would be much happier to do all of the above in their home country – or under a ton of concrete ala Jimmy Hoffa.

The same can be said about the Internet. I’ve given up, but I used to post pics with captions like “A beautiful day in Dumaguete,” only to get slammed because after all it’s too hot or there’s smoke or too many roosters, bad traffic, or whatever else is bothering people at that moment.

Dramaguete – that’s what it is.

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Today, the day after Christmas, a friend of mine posted a comment on a FB group: “My Christmas Wish is Expats Remembering we are GUESTS HERE. We Are the Aliens. Philippines, Love It or Leave It…”

Dramaguete – You can imagine what many of the 50 comments were like.

Now again, complaint is a normal part of human life. But often here the complaint takes the form of ‘I am miserable and I want everyone else to be miserable too,’ or ‘I’m right and they (Filipinos) are wrong and it’s about time “they” listened to those of us that are right.’

In fact whenever I hear the “they” word in conversation I cringe a little. I want to remind the other person that “they” are citizens of the Philippines and “we” are not.

Going back to my Portland analogy, it took about 10 years to stop saying “they” (about Portlanders). Once I considered myself a Portlander and started saying “we” I found myself much happier in my environment.

So at this point Janet and I live in Dumaguete, we built a home in Dumaguete. In short we are Dumagueteños. For those who struggle with the language, culture or people of Dumaguete, I suggest you try to think of yourself as a Dumagueteño and forget the “us vs. them.” Your attitude and happiness itself might change.


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Making Friends & Being Unfriended in the Philippines

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When people consider expatting to the Philippines one area they focus on is learning to work harmoniously with Filipinos. It’s a different culture; one that the wise expat to be knows he will have to adjust to. They rarely think of how to work harmoniously with other foreigners. They should! Years ago, as I researched the possibility of moving to the Philippines, I befriended a guy online who had been living in the Philippines for a number of years. He generously advised me. His blunt assessment? “The biggest problem you will have in the Philippines is with other expats.” While “other expats” have not been the biggest problem we have had since we moved to Dumaguete, it’s near the top of the list.

Now mind you I am at an age where having a large number of friends is not a high priority but I certainly wanted a few. Friendships can come in many categories. There are the ‘get together occasionally and hoist a few’ type of friends (I’m frankly not a big hoister), there are the ‘friends who bond over a common interest or hobby’, and then there are the ‘couples friends’. As a married expat the latter is a particularly important category to me. Perhaps even more important are the friends ‘I can call when the car dies’; you know – the guy you can rely on.

Filipinos view expats as all relating easily to one another. After all they see foreigners chatting together at the various watering holes. Many such expats joke about or complain about the fact that Filipinos can’t tell the difference between an American, an Australian, a Brit, German, etc.

But it’s sort of a problem for me. I have friends and acquaintances who are from the UK, Australia, Germany, Belgium, etc. I even have a friend whose both from the UK and Australia; still trying to figure out which aspects of his character come from which culture. Let’s just say that despite our shared white skin, we are different.

And then there are the Americans. I spent 43 years in the Northwest after growing up in the Northeast. Here in Duma I have American friends from New England, the South, Texas, California, Arizona, etc. Yep, we’re all Americans, but we sure as hell ain’t the same.

Sometimes guys befriend guys from their home country. You see groups at the various foreigner watering holes and often those groups congregate based on country and language: a table of Germans speaking German, Englishmen speaking English and Americans speaking – well whatever the hell language we speak.

And sometimes, just as with Filipinos, language differences create misunderstandings, even arguments. There was the time I complimented a guy on the quality of the restaurant/bar he owned, which I called a “simple” straight-forward bar. He didn’t like the word “simple” and I spent quite a while trying to explain why to an American a “simple” bar is a very good thing.

There are topics I avoid with guys from other cultures. Soccer vs. football, which is what rest of the world incorrectly calls it 🙂

I liked the film ‘Invictus’ but that’s my only positive interaction with rugby. And no, Australian Football is not Football. Anyone can see that. But as I say, I stay away from those remarks in public lol.

Speaking of films, I’m a film nut and have been my whole life. I have thousands of films in my library. When I suggested to a couple English friends that we do a movie night at my place and watch a classic, they both said they didn’t watch movies. When I mentioned to another Englishman that Janet and I had just seen the latest action hit at the theater at Robinsons he said, as if it was a badge of honour, that he’d never been to the theater and never would. Made me sort of wonder how Daniel Craig and Sean Connery learned to act.

I also learned long before the current bizarre climate that to have friends I stay away from political discussions. That said, there’s nothing more entertaining that watching 60-something Americans throwing (and missing) swings at each other over political disagreements. Other foreigners simply don’t understand. I’ve heard often, “Dave, you’re the only American I know who doesn’t want to talk American politics.” “It’s boring,” I reply. “And so is Brexit.”

So the reality is that if you want foreigner friends you are going to make friends from different cultures. It’s cool, sometimes exciting, and often a pain in the ass.

If I think about it, when I lived in Portland I had a number of friends I had known for decades. I even had a friend I went to college with in New York City, meaning we’d known each other for over 45 years.

Each year, being not the super social type I might add a friend or two. I also would lose a friend or two, either through someone relocating, dying or just growing apart.

When Janet moved to Portland and we married I added many new friends; the male half of Fil-Am couples we met. But this explosion in new friends was an aberration not the norm for me.

I arrived in Dumaguete knowing a couple of guys just a little bit. We had a once a month beer drinking group based on a forum we all belonged to. A varied and good group of guys and I still go to the monthly meetings when I am available.

Some of those guys I see more than just once a month but others I only see at that monthly meeting. I like catching up with them and go away thinking ‘I wish I could see that guy more often,’ but generally forget that determination within a few minutes.

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Nonetheless, despite my busy yet lazy retired life, and despite my general unsociability, I have made a few friends. We just hosted Thanksgiving in our new house and Janet made a spectacular turkey with all the trimmings for three other couples. Had we been a little more settled (we’d moved in less than three weeks before) we probably would have invited a few other couples, but the 10 or 11 people who were there were enough for now and were treated to a great meal.

So it’s been over two years and while I do have a few friends, and even a couple guys in that ‘I can call if the car dies’ category, I can’t help but think of a couple friends that faded away – and one that exploded.

There was the one American who we hung out with a handful of times and seemed very cool. We shared guitars in common. One day I realised I hadn’t seen any Facebook postings from him in a while, so visited his FB page to see whether I had missed anything, only to discover he’d unfriended me. No conversation or explanation – nothing. I wracked my brain to see if there had been anything said in a previous conversation that might be off putting and could think of nothing. Janet saw him 6 months later on the street and said he looked gaunt and older.

And then there was the Englishman and his Filipina partner. We’d gotten fairly close over the course of a couple years and the two girls got together regularly to share and probably console each other.

Over the course of the last year both Janet and I had become a bit less thrilled with the male part of the couple, but not enough to end the friendship, just enough to know that it would remain casual and not go deeper; IOW not a ‘call when the car dies’ sort of trust.

Both Janet and I on separate occasions said something to him that although honest and respectful, he didn’t like. About a week later he sent me a Messenger message saying that he and his partner could no longer be friends with us. I crafted a response but by the time I hit send, discovered that he’d not only unfriended us on FB but had blocked me as well.

More significantly the female partner unfriended Janet. I figure the guy probably convinced her to cut ties. Janet misses her and I suspect she misses Janet as well. The girls are far younger than me and need connection more than I do. I just shrugged my shoulders and threw out a couple “what an asshole” epithets (I’m sure I said worse). The whole blocking thing is bizarre but the social media has changed the nature of relationships and not for the better IMO.

So I move on. I have my monthly beer friends, I play golf weekly with a couple of buddies, have a handful of guitar friends, and this week we will host a house blessing/house warming for friends and family, and I am sure I will be reminded that I do know a number of good guys in Dumaguete.

But even those good guys agree – there’s plenty of asshole expats out there, so be careful.

BTW, the above pic doesn’t have much to do with the topic but they all do look like friends – lol. Oh and did I mention how many foreigners lose friends and even take swings at each other over politics?

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How to Avoid the Long Nose Tax Through the Art of Negotiation

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Here’s one that’ll get me in trouble!

All you have to do is get together with a few expats and eventually the subject will turn to getting overcharged in the Philippines. People call it the skin tax, the long nose tax, the white tax. It usually involves prices in markets, street vendors, service people, and taxis. The assertion is that we are all “cheated” for simply being a foreigner. And while I would be a fool to say that it has never happened to anyone, my basic perspective is that it is much less frequent than expats scream about. Now there is a “tax” in the Philippines but it isn’t so much the skin tax; it’s the “you’re rich” tax. In my more cynical moments I’d also call it the “idiot tax” lol.

The fact is that until a couple generations ago “negotiating” was dominant in our Western cultures but that art has disappeared. Not only do stores have fixed prices, they have prices based on whatever some faceless/nameless computer says. Most service organisations followed suit. But it wasn’t that way in our parents’ or grandparents’ day; they knew how to negotiate and it was an important skill to master, as most of our grandparents were poor or little better.

The bottom line in the Philippines is that, as all over the world, the seller wants to get the maximum amount for his goods or services and the buyer wants to pay the minimum possible. So how to do that?

I have to mention that I have some experience in this matter. For many years I ran a small service-oriented business. People came to my office, asked for a service, and I quoted a price. Sometimes they got out their checkbook or credit card, and sometimes the games began. As the “seller” my job was difficult; I didn’t want to lose the business but I also wanted to get the maximum amount I could. And since I had to work with the customer afterward it was important to me that both of us went away without resentment. Often that meant I gave the customer a small discount; enough to make them happy, but not enough to piss me off.

The other thing that most people don’t understand about small business or service people is that often the price depends on their personal circumstances at the moment. Many times I was broke and needed to pay the mortgage that week. That meant I needed to get all the business I could and was willing to drop my price a bit more than normal. Sometimes I was in such bad financial shape that I decided the opposite; that I had to remain absolutely firm on the price. If you came to my office that day you weren’t getting shit for a discount.

Don’t think this is true in the Philippines? Don’t think that sometimes the service guy comes to your house and really needs the work that day (and your pesos)? Of course it does. And dependant on his circumstances that might mean you get a better price – or a worse one.

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Also in my business I learned the art of reading people. I understood when an 18 year old came in wearing tattered clothes, I might be giving a discount. When a guy came in wearing a $2000 suit, he wasn’t getting shit lol. This is in fact the reality in the Philippines. Mrs. Rodriquez comes in and the vendor knows her and her family; he probably knows her monthly income. You, the foreigner walk in and the vendor knows you are rich. There’s no sense saying you’re not rich; compared to Mrs. Rodriquez you are. You’re the guy in the $2000 suit and the asking price will be higher and the seller will be less likely to negotiate down too much. This isn’t racism; it’s just business. One of the reasons expats mistake the “you’re rich” tax with a “racist tax” is that most of us have never been viewed as rich before.

So let’s talk some strategies, shall we.

  1. Get rid of the notion that you’re going to be cheated. This is a very poor negotiating stance. Even if you get a decent price, you’ll go away sure you’ve been scammed. I’ve heard guys publicly yell at vendors that they were being overcharged because they were a foreigner. Had someone walked into my office and claimed I was overcharging them, they would have been asked to leave – immediately.
  2. If you really feel you are being overcharged for whatever reason – leave and find someone else. It ain’t that hard. If you still decide to pay the vendor what you feel is a poor price – that’s on you, not them.
  3. Learn to negotiate. I know many expats who let their wives or girlfriends do all negotiating while they stay in the car or at home. While that is certainly your right and might be an easy solution, it guarantees you will never learn to negotiate here. Go in and do it yourself, make some mistakes and do it again. Pretty soon you will learn the ropes.
  4. Perhaps most importantly is; know the approximate price of an item or service. If everyone is selling mangoes for 120/kilo and someone asks you for 150, use that information to negotiate. “120’s the standard price now.” If they don’t come down, no need to get mad; just walk to the next vendor. OTOH if they say, “Yes Sir, 120 is standard but these mangoes are of much higher quality.” Then you have a decision to make; but it’s your decision. You’re not being cheated.
  5. How important is the savings to you? If it’s 10 pesos in the market I may not want to argue for five minutes over it. OTOH if it’s a service that means thousands of pesos, your negotiations might be pretty important.
  6. Most Filipinos want your business and will give you a discount. We are building a house and needed to contract a particular item. I had someone come over and give me a bid of 9500P. Janet yelled (at me) that it was too expensive. I sent a message to the vendor that the price was too much; what was his best price. “6500 is my best price, Sir.” Sold! Now could I have continued to beat him down on the price? Maybe. But I was happy he’d dropped 1/3 off his price.
  7. Always assume the first offer is not the best price. Shake your head, roll your eyes, scream at how high that is, and ask for the “best price.” In most cases the price will come down; in some cases significantly. And be prepared to walk; the seller can tell the difference; they’ve done this for years.

There are exceptions to the above rules. Sometimes I am in a rush or in no mood to argue over a few pesos. Once again in such a situation I have decided to pay the asking price; no one’s cheating me.

Janet has an even harder decision. She still uses the same techniques and language she used before we married. The difference is that then she had to get the best price; she didn’t have the pesos. Today she knows that she can afford to pay the asking price. In all likelihood the vendor sizes her up and also knows she can pay the asking price. Then it is more a matter of face for Janet to insist on getting a reasonable discount. Just like me she too may sometimes decide that the argument isn’t worth it. OTOH we have often walked away when she sensed that she wasn’t getting fair treatment. I’m happy to walk away with her.

The bottom line is this: if you get a lousy price – learn to negotiate better. If you choose to pay the lousy price – that’s completely on you.

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The Bathtub Saga

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I just posted a picture of a completed and functioning bathtub in the house that we are building , jets and all, and there were enough oohs and ahs that it was time to tell the complete and bizarre story.

There were only a few things I had to have in our new house; two really. One was a separate shop which is heading toward completion and the other was a bathtub. I have always liked bathtubs and had one in most of the places I owned or rented over the years, but none of the places we have lived here in the Philippines had one and I deeply missed it. Also, as age is creeping in, I find my desire to simply lay in warm water has increased exponentially. At my age it’s better than almost anything. In fact when I go to a pool or into the ocean here I rarely bother to swim; mostly I lay or sit with a smile on my face.

In short the tub was pretty damn important. Before Janet and I started building our house we saw a nice modern bathtub in Citi Hardware that we both liked and wanted. Coincidentally when our contractor presented us with sketches of the proposed house the master bathroom sketch included that very same tub. So we agreed that was the tub for us; one less thing to worry about. Yeah, right!

Three months after the house construction started we were in Citi Hardware and I noticed that particular tub was not on display. We asked the salesman and were told that not only were they out of that model, no Citi Hardware in the country had one left and they had no idea when or if they would get more.

We were annoyed and the salesman went off to confirm what he’d told us. I went around the corner and saw the same tub made by the same manufacture. The only difference was it had jets and was only a tiny bit more expensive. I had no interest in jets but what the hell. We messaged our contractor. A couple hours later he messaged back that he had ordered the tub.

Of course I was dumb and naive at that time. I still thought like an American and assumed “ordered” meant that it had been paid for or a deposit put down or something like that. Um, not quite.

A few weeks later I got another message from the contractor, “The tub is in.” Great, I thought.

Two weeks later we were again in Citi Hardware looking for other items and I happened to see a tub in its box sitting on the floor of the bathtub area. I said proudly to the salesman who was helping us, “I think that is my tub!” He replied, “The tub has not been paid for, Sir, and has been here for two weeks. If it’s not paid for soon, it might get sold to someone else.”

Hearing this Janet and I were pissed at our contractor. While I was tempted to just buy the tub right then, I thought (naive moron that I was) that I should make the contractor do it; that was his responsibility. He acknowledged that he didn’t have the cash. We met him an hour later, gave him the cash with the instructions to get it done! Later that afternoon I got the bad news. “The tub has been sold and there are no more to be bought at any Citi Hardware!” I was furious and ranted and raved. I went online and started looking for comparable tubs. Oh did I mention the real problem? They had already cut the hole in the concrete for the tub pipes so I needed a tub with the dimensions and set up of the one we’d lost.

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Janet tried to calm me down. “Let’s go to Citi tomorrow and see if there is anything else we can find out.”

The next morning we went to Citi Hardware. As we entered the warehouse-style store, the salesman we’d been dealing with saw us and immediately turned ashen. He apologised profusely, explaining that another salesman had sold the tub. I told him, “I understand. It was my contractor’s fault for not buying the tub and you told me that it could get sold. Can you contact the vendor and see if any more might be coming?” He went off to do that and Janet and I stood in the bathtub section wondering what to do. I walked around the corner and came face to face with the display model of the tub that we had lost, the very tub I was told was not available anywhere in the Philippines. “Janettttt,” I yelled. We examined the tub for cracks and imperfections.

The salesman returned and I pointed to the tub. “What’s wrong with this one?” “Nothing, Sir.” “Does it have its motor and jets?” “Yes Sir. It’s brand new. It’s only been out for display for a little while.” “Then why can’t I buy this one?” I asked trying to remain patient. “You can, Sir.” “Well then why…” I ran out of words.

Janet took over. “So what discount will you give us for a display model?” The salesman went to check and then told us 5%. “So how will you prove to us that the tub is in perfect working order?” I asked. No problem. They took it outside the store, filled it with water, plugged it in and showed me that the jets worked.

I called my contractor with the news. “I will come over in a couple of hours and pay for it,” he said. “No way,” I said. “I’m paying for it now.”

This is how easy it is to get a tub with jets in the Philippines!

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Dave’s Not Here. How the Philippines Changed My Name Back to David.

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I always hated my name. Not sure why but I thought my friends Mark, Lee and Eric (called Ricky) had cooler names. Mostly it must have been the fact that when my mother was mad at me I heard that “Daaaviddd.” Hated it.

At 17 I went off to college where all young people re-invent themselves. I introduced myself to everyone as Dave and from then on that’s what I was. I told the family – eventually – and some of them made the switch – though others never could.

At 32 I got married to wife #1. She liked David and insisted on calling me that. I was in love (or maybe just horny) and let her. Six years later we got divorced and I determined never to be called David again. Wife #2 admitted she actually preferred David but knew better than to call me that. My darling Janet always called me Dave.

Segway 32 years. I am 64 and retired in the Philippines. I go into Robinsons and make a purchase in the department store. “What is your name, Sir?” I am asked for the sake of the receipt. “Dave,” I respond. “Steve?” “No, Dave.” “OK, Steve. “No Dave. You know like ‘Dave’s not here.'” Stares of incomprehension.

The next day I am at Citi Hardware. Same thing. “Can I get your name for the receipt, Sir.” Same confusion. OK, the clerks are cute so I give them a break, but it’s annoying.

Everywhere in the Philippines I am asked for my name. This is interesting coming from a culture in which anonymity is so prized.

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After at least a dozen of these episodes I respond, “Dave. You know like David.” “Ah, Sir David! Yes.” Success of sorts.

For a couple more months I continued to explain that Dave was from David. Finally I got tired of it.

“Sir, what’s your name for our records?” “David,” I mumbled. “Thank you, Sir David.”

From then on I figured what the hell and answered to David. If you’ve lived in the Philippines for any length of time you learn that you are not going to change the Philippines. The Philippines on the other hand may well change you. So now at 66 I’m David again, damn it. I can hear my mother calling me! Daaaviddd!

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House Project – The Good, Bad, Ugly – and Ugliest

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We have officially started the last week of the house portion of the project. Our target was that the house itself would be completed by September 30 and that October would be reserved for issues outside the house: completion of the wall and spikes, completion of the shop, completion of the canal, etc. We “might” actually hit our target, so this looks like a good time to review the entire project and call out some of the problems I have only hinted at before.

The Good: The contractor that we eventually hired had an architect/engineer friend who came up with two modern designs, both of which we liked. We asked for elements from both designs which he combined to create a final design. We were excited.

The contractor came up with a bid which I thought was OK but maybe a bit high. He ultimately agreed that his bid would be a fixed price; meaning that there would be no cost increases from inflation. As you will soon see, this became irrelevant. Nonetheless the negotiations went well and soon we were signing a contract with a lawyer.

Not long after, the construction started. While I would hate to categorise the entire subsequent process as bad, this was the end of the honeymoon period.

The Bad: Our contractor hired a foreman and work commenced. We were soon to find out that the foreman was only hired for 2 days/week. We complained about that but the contractor assured us that between he and the foreman there would be plenty of supervision. There never was.

A small crew, averaging 6-8 began the wall (or fence as it’s called here) surrounding the property. Janet and I would come over daily to check the progress. Sometimes progress was being made and sometimes not so much. More complaints to the contractor, more assurances, and the wall progressed, though slowly.

Three months later the wall was mostly done and they switched to work on the house. The crew expanded to about 12-13. It was quickly clear to us that a crew of a dozen would take two years to finish the house. More complaints, more assurances but the crew was rarely large enough.

There were ups and downs, mistakes and more mistakes, but yet the house did begin to take shape. Within six months we could see that these guys might actually be capable of building this house; we really weren’t sure before. But by the six month mark, money became a worry.

The contractor’s money methodology was simple. He would ask for a certain sum of money monthly and I would give it to him. After a few months the pattern was set but I could do the math and confronted him, “At the rate you are asking for money, the money will run out before the house is completed.” He assured us the first few months were the larger portions of money required because of steel and concrete, etc. and that later requests would be smaller. This never turned out to be true.

As a certain point Janet and I had one of those “Come to Jesus” meetings with the contractor. Janet said, “We have given you half the budget but we only have 25% of a house.” He again reassured us, showing us the numbers of what was still left to buy and how much got paid to the crew and that we still had money to complete the project. I was skeptical. Similar conversations and similar assurances would occur monthly.

Janet would try to assure me. “We have a contract. We can sue him if he doesn’t finish.” As the more experienced and more cynical partner I told her “A contract is only good if the person you are suing has money to pay you.” Nonetheless since progress continued we remained cautiously optimistic.

As I have documented in other blog posts, not only was supervision of the crew hit and miss, so was material purchasing. The crew and foreman often complained to us about not having the materials they needed. We would complain to the contractor and eventually more materials would arrive. But this clearly slowed the project. And less efficiency meant more cost.

We tried to help the contractor save money. Whenever we would see a needed piece for the project on sale we would contact the contractor. “Robinsons has overhead fans on sale for a great price.” We would buy the sale items and minus that amount of money from what we owed the contractor. While this should have been his methodology all along (shopping for deals), in the end it didn’t help him.

We also tried to help the contractor schedule the job. In June we went to the contractor and told him we needed the house done by the end of September so that we could move in during October. He agreed that it could be done. He told the workers that if they finished by September 30 he would give them a lechon party. Lechon is very big in the Philippines and for a few weeks the crew was excited. Pretty soon they knew the truth; that there would be no lechon.

The Ugly:

And then the fateful day occurred (cue organ). The contractor asked to meet with us at our rental home, which he never did before. He explained that he had no more money and had used some of our money to buy himself a piece of property. He couldn’t sell the property because the title was not finalised and the economy was soft.

Frankly we already knew that he had purchased a piece of property. This is the Philippines and everyone knows everyone’s business and so we had been told months before that the contractor had bought a lot. At the time my attitude was, ‘Well he’s entitled to make a profit and if he uses some of his profit to buy a lot that’s his business, as long as I get my house.’ But now it was clear we were not going to get our house.

Our first step was to take over all purchasing for the project; we simply felt we could no longer give the contractor any more money. What was shocking was how little materials were at the project. The crew needed everything. I made a list of the major elements I knew still had to be purchased, but that list turned out to be a fraction of what they really needed. Janet and I were going to stores all day long every day and cash was flowing out of our bank faster than I could keep track of it. My desk had a stack of receipts which I tracked on my spreadsheet and soon it was official; the budget was spent and we were in the red.

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For the next few weeks we gave a modest amount to the contractor weekly to pay the crew. Then one day I was contacted by a guy who was also using our contractor. “Is your crew being completely paid? Mine isn’t and they are ready to quit.” I said, “I think they must be – no one’s complained.” The next day Janet and I went to the site and asked each crew member. BTW, by this point in time the crew was over 30. Every crewman was owed some money. One poor guy was owed back pay for three weeks.

At that point we took over the payroll and paid everyone everything they were owed. It was the equivalent of an extra week’s pay.

For all intents and purposes we took over the running of the project. We asked the foreman if he could temporarily work more days and he agreed. Janet spent 8 hours a day on site watching the crew and yelling at them; she does this well. I ran around daily buying stuff. We were and are busy busy retirees.

We brought in Janet’s oldest brother, Marlon from Cebu to work. He’s worked very hard and really shown some of the crew members how work is supposed to be done. This has turned out to be a good decision, although our little rental house is now a crowded little rental house.

While there have been plenty of glitches everyone can see that the crew has worked harder and gotten more done. With luck (fingers crossed) this week the final elements of the house will be done. On Saturday Janet is giving the crew the promised lechon party.

Next week the air conditioners get installed and the crew moves to the outside projects and shop completion. With even more luck those elements will be completed in October.

In the meantime we know that there are a hundred little touch up jobs required in the house, mostly involving paint. I will be finishing the doors and there are a lot of them. Janet plans to bring the kids up from Alcoy on their school break to clean. Only in the Philippines do kids get excited to come to an overcrowded rental house to be worked like dogs.

The Ugliest: I may be conning myself, but I pride myself in telling the truth. It may be my truth or my interpretation of the truth but still I tell the truth. I ran a business for 14 years and when problems occurred I told the customer the hard truth. I worked at Intel for 15 years and told my accounts (Fortune 500s all) the cold hard truth and they accepted it.

I have become angered and depressed by how often I have been lied to in this process. Sometimes the simple lies are lies of omission, sometimes the gentle lies of ‘we don’t want to admit there’s a real problem,’ but many times bald faced lies were told to my face. It was infuriating and at times deeply depressing. I have no conclusions and no interest in globalising my experience but when I say “two plus two is four” and am told “no it’s five” – well as I say it’s infuriating.

While I don’t have final figures yet it looks to me like we will end up 20% over budget. The contractor promises that when he sells or mortgages his property he will give us some money. It might happen but I’m not holding my breath. He’s actually not a bad guy but got in way over his head.

Conclusions: Assuming you still want to own a house in the Philippines after having read all these blog posts, here are my recommendations:

  1. Buy an existing house. There are plenty of “foreigner houses” for sale throughout the Philippines and often for good prices.
  2. If you must build your own dream house, function as your own contractor. Hire an engineer and or foreman to run the project, while you do the purchasing. You will spend a year or more of your life going crazy, but it is probably the safest way.
  3. Did I mention that you can buy an existing house here and let your wife remodel it?

A funny (in my warped way) story: We did know for months that our contractor was in financial trouble because he kept listing stuff for sale on FB Marketplace. Generally it was stuff I would have no interest in but a few weeks back he listed a high end Canon camera with a couple lenses; a model that would have been a professional model a few years back. I like photography but sold my Nikon gear before I moved here. BTW, when I worked at Intel there were practically fights in the hallways over the Nikon vs. Canon debate. Shows you what nerdy engineers will get excited about.

I sent him a message. “Why don’t you just give the camera to me, as part of what you owe me.” He agreed, but could I give him a little bit to pay off the last of the workers. I agreed. When Janet and I inspected the camera I asked, “How long have you owned this?” “Eight months,” was his reply. Janet and I caught each other’s eye. I knew I was basically getting back the camera I had paid for.

So, I don’t have a house yet but I do have a nice camera.

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Why the Hell Would You Buy a Lot in the Philippines – More Tips and Landmines

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I should once again make clear that I am not a contractor and know little about house construction in the U.S. or the Philippines. I should also say again that despite any complaints I might have, our workers work hard and, let’s face it, work hard for small pay.

The following are more layman’s observations.

Can Anyone Count?

While in our last episode I complained that our contractor never bought all the materials needed, in this episode I will complain about the corollary. Now that we have taken over purchasing, we have asked all the key people (including the contractor) for lists of material needs. This has worked much better but still can be a nightmare. “We need 120 of this color tile, Sir.” So Janet and I dutifully buy 120 only to be told a week later that we need another 80. Counts are consistently not just a little off but 50-75% off. When I have time I count myself but sometimes I just get the number requested and go ballistic when I discover that someone simply couldn’t count. The conclusion: make your own count or resign yourself to the fact that you will be returning to the store multiple times for the same item.

The reverse is also true. “We need X,” I am told only to discover days later that boxes or bags of X already existed, buried under something else. It’s not the end of the world, but annoying as hell.

Finishing Something

I really don’t consider myself to be too anal (no comments). For the last 23 years in the US I lived in two old homes and accepted their flaws and imperfections. What I find in construction here in the Philippines is that nothing is ever finished 100% before the crew is moved to another task. I would estimate that our project is 80-85% completed but there is no one area that I can point to and say, “This is finished.” Painting is maybe 75% done, tile 95%, electrical 80%, plumbing 75%, etc. etc. But it seems that for whatever reasons nothing is ever completely finished before the crew is moved to another task. I am sure there are some reasons for this, such as materials running out. But in general there seems to be an “it’s almost finished” attitude that permeates. Yesterday I was told that the closets were painted and finished. When I looked I pointed to unpainted spots and areas covered with paint dust that should be cleaned. “It’s mostly finished, but not completely finished,” I said. “But it’s basically finished,” I was again told. This becomes particularly sticky when a pakyaw worker wants to get paid.

We had a welder on pakyaw for the past month. In fact he contracted to do 4 separate pakyaws. Each time he would finish 90% of the work and move to the next assignment, because that was where the money was, assuring us he’d come back and finish the previous job. When all four were 90% done and almost all the money paid out he was told to go back and finish. He spent a couple days halfheartedly finishing the assignments and doing poor work. By the end of the day Janet and I handed him a few more pesos and told him he was done. I spent my Sunday morning finishing some of what he hadn’t. It’ll get done but will just take some time and wear and tear on my ancient body.

The conclusion: Whenever possible make sure that something is done before moving to the next assignment. And don’t do pakyaws.

Do You Want Paint to Go With (or On) Your Tile?

We knew from observation and hearing stories that in the Philippines tile is laid down before the house is painted and the tile is rarely covered. From early on in the project we asked the contractor to schedule the project so that the tile came a little later but if he couldn’t do that to lay down plastic or something to project the tile. He agreed.

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Sure enough the tile went down first and despite numerous complaints nothing was done to protect it. The view is that it’s easy to clean later but the fact is that it is not. The contractor’s view is “it’s water based paint. It’ll clean up easily.”

The same attitude seems prevalent everywhere. If you have to step on, scratch or damage someone else’s work so that you can perform your work, then that’s what you do. I have given up on complaining about it. We will clean it and fix it as best as we can as we go along or at the end of the project. Janet already plans to have the kids come to Valencia on October break to clean.

Be Careful of Friends and Associates:

One of the advantages of the Philippines is its social nature. Everyone knows everyone. I swear that everyone in Dumaguete knows our contractor and visa versa. There are advantages to that and disadvantages.

The biggest disadvantage is how to discipline or even fire your friend, relative, or someone you go to church with. I know for a fact that there were people hired on the job because the contractor knew they needed money and not necessarily because they were the best person available. Now when it comes to general labor, this might be a good thing; someone motivated to work hard. But when it comes to the skill positions my preference would be for the most skilled person that can be obtained.

Supervision

One of the biggest differences between the construction of Janet’s small family house in Southern Cebu and the construction of this larger house in Valencia is supervision. Janet had no contractor in Cebu and functioned as her own contractor, but she did have Boy, an older Foreman who was on the site 5-6 days/week. While there were exceptions he mostly made things flow smoothly.

On our project a Foreman was hired but for only two days/week. I questioned that decision from the get go but was told that between the Foreman and the Contractor there would be plenty of supervision. Wrong! It was quite common for the majority of a day to go by without a supervisor onsite. Workers made their best decisions but sometimes didn’t know what to do. And of course unsupervised they did not do their best work. I complained constantly but there was never a real solution.

When Janet and I took over direct supervision of the project the first thing we did was ask the Foreman whether he could give us any more of his time for the remainder of the project. We like him and find him competent. Happily, he said he could do 3.5 – 4 days/week. Since then things seem to flow smoother and frankly the Foreman seems happier. He’s actually allowed to use his skills.

The conclusion is obvious and not unique to the Philippines. Get a good Foreman and hand him the reigns.