Secondary Market

Secondary Market is a concept that enables the resale of existing real estate assets—such as condos or house-and-lot units—between buyers after the initial sale by the developer.

Definition

In Philippine real estate, the secondary market covers resales of properties already issued a TCT or CCT, including “pasalo” or assume-balance deals where a buyer takes over the seller’s mortgage. Unlike the primary market, transactions here involve negotiated pricing, due diligence on liens, and transfer taxes to the BIR and LGU. Listings typically appear through Multiple Listing Service channels or brokerage networks rather than developer launches.

Key Components

• Title status: existing TCT/CCT, annotation of mortgage, and lien checks with the Registry of Deeds.
• Deal type: clean resale vs. pasalo/assume balance with lender consent and updated Contract to Sell.
• Pricing: based on comps, Price Per Square Meter Trends, and unit condition (RFO or occupied).
• Taxes and fees: BIR Capital Gains Tax, Documentary Stamp Tax, local transfer tax, and HOA association dues clearances.
• Disclosure: outstanding amortization, arrears on Value-Added Tax (if applicable), and building turnover status.

How It Works

1. Seller or broker lists the property on Property Listings and boosts reach via Lead Generation and Property Search.
2. Buyer performs due diligence: title check, arrears with HOA, and bank consent for pasalo or assume-balance cases.
3. Parties agree on price and payment terms; buyer may assume the loan or refinance.
4. Taxes are computed, paid, and receipts kept; deed of sale or deed of assignment is notarized and lodged with the Registry of Deeds.
5. Payments and commissions are tracked in Payment Tracking and Commission Management until turnover.

Pros & Cons

• Pros: Immediate availability (often RFO), visible market comps, negotiation flexibility, potential discounts in pasalo cases.
• Cons: Possible liens or arrears, unit wear-and-tear, bank approval needed for assume-balance, and longer title transfer timelines.

Real-World Application (Philippine Brokerage)

• Brokers package resale units with updated photos, walkthroughs, and comps to justify pricing.
• Pasalo deals require lender coordination, revised Contract to Sell, and clear disclosures on remaining equity and loan balance.
• Use Property Listings plus Lead Generation for demand, then manage paperwork and deadlines with Payment Tracking and Commission Management.

Related Terms

• Multiple Listing Service
• Contract to Sell
• Ready for Occupancy
• Price Per Square Meter Trends
• Value-Added Tax

References

• Philippine Stock Exchange Academy – Secondary Market definition
• BIR Capital Gains Tax guidance – Real Property