Lessons learned by a real estate broker, homeowner, and investor from Provident Village

This is the second part in my series on the reflections of a real estate investor(that would be me!) after Typhoon Ondoy’s wrath. If you missed the first part, you may want to read it before reading this. You can find part one here – Reflections of a Real Estate Investor: Ondoy’s aftermath


Next I try to share what I’ve learned and become aware of as a licensed real estate broker, homeowner, and as a real estate investor in Provident Village, Marikina City, Philippines. Here goes…

Bangon-Marikina-Kaya-Natin-ItoThis banner was placed on a wall at the entrance of Provident Village, Marikina City

Yes, I know we can!

Last Monday, I went back to Provident Village to see the situation and to check if we can already go back to our house to try to salvage what can be salvaged and assess the extent of the damage. As I turned right to the entrance of Provident Village, I saw the banner above and  tears rolled down my face immediately. No, they were not tears of despair but rather tears of hope. The banner reads “Bangon Marikina, kaya natin ito (Get up Marikina, we can do this!)”. I say yes, I know we  can!

I was also pleasantly surprised that there were a lot of bulldozers and trucks that were being used for the clearing up operations. Last Monday, the front of our house was still full of mud and debris which made it not passable to small cars like my Hyundai Getz but I can see that our entire street will be cleared before the end of this week.

Suggestions from Mayor MCF

After a quick visit to Provident Village, I then proceeded to the Marikina City Hall to attend a meeting between Mayor Marides C. Fernando (also known as MCF to her constituents in Marikina City) and the Real Estate Brokers Association of the Philippines – Marikina River City Inc. (REBAP-MRCI) chapter which I was a member of.

PA121253REBAP-MRCI President Malou Llado(left) speaks as MCF(center) and other REBAP-MRCI members listen
Meeting adjourned. I'm the guy in the middle, with glasses. Meeting adjourned. I’m the guy at the back but in the middle of the picture, with glasses.

As real estate brokers (and also as a real estate investor in my case), members of REBAP-MRCI wanted to know how we could help the Marikina City Government after the City of Marikina was badly hit by Typhoon Ondoy. We were also interested in finding out what plans the Marikina City Government had for Marikina after the devastation. Obviously, the floods will have a big impact on property prices and demand for such, which in turn would affect the livelihood of real estate brokers that focus on the City of Marikina. I’ll try to summarize what I learned from the meeting below:

  1. MCF suggested that houses in those areas that experienced very high floods should seriously consider using their first floors exclusively for garage or parking purposes and houses should at least have a second floor. A roof deck is highly recommended. It would be more like a house built on stilts.  I personally have thought of the same in case we do decide to push through with plans to have a major renovation done on our house. More on this later.
  2. During the conversation, one member of REBAP-MRCI asked if there were any plans to put up more water pumping stations in Marikina. MCF answered with another question, “Where would the flood waters be pumped to?” I guess the real problem is that the flood waters are not really from Marikina itself but rather from the surrounding areas. That’s the problem with being a valley.
  3. With regard to reports that some homeowners are selling their houses at ridiculously low prices and yet still have no interested buyers, MCF advised us that maybe we can find opportunities there. Of  course as licensed brokers we may help those that want to sell and also help find houses for sale for real estate investors.
  4. Another suggestion from MCF was to use low lying areas exclusively for non-residential purposes which are okay to get submerged by flood waters.

Our meeting got cut short because of an unplanned but very welcome healing mass with healing priest Father Suarez which was just about to start at the Marikina City Hall. The meeting was adjourned and  we just attended  the mass. This was just what we all needed, healing!

Father Suarez during the healing massFather Suarez during the healing mass at the Marikina City hall

Lessons learned and observations of a homeowner in Provident Village

1. Always have your house insured with coverage for Acts of God. Though a lot of people have said that what had happened was actually an act of man(ex. the alleged releasing of water from dams, climate change, etc.), it would not hurt to have Acts of God coverage. The higher premiums would have been well worth it. Unfortunately, our house only had fire insurance. I’m quite certain insurance premiums would sky rocket after the floods and I also won’t be surprised if insurance companies would start refusing to give such coverage to areas hit by the floods.

2. Houses should be built like houses on stilts. In this configuration, the ground floor would be just a wide open space that can serve as parking or a basketball court, etc.  At the very minimum, houses should have a second floor that has an exit that won’t be hampered by flood waters (more on this below). There were a lot of reports of people being trapped at their second floors and they only got out by destroying the ceiling and the roof.

3. Functionality of doors and windows and their locks should not be affected by flood waters. One thing in common I found with most houses that got submerged by the floods was the doors and windows(including fire escapes) could not easily be opened. Either the door mechanisms/padlocks got jammed or the wood of the door itself expanded and got stuck with the door jamb. I’m not sure if there are water resistant door mechanisms and locks out there but I guess keeping them well lubricated would help. As for doors, I guess using high quality wood would help prevent the “pamamaga(expanding)”. Obviously, if the rising water had force and pressure, this would also hamper opening them.

4. Have rubber boats, air-beds, life-jackets, life-savers or inner tubes, or any acceptable “floatation” device handy. These would at least give you a fighting chance in case you needed to move to higher ground. When my son and Emily, his nanny, eventually had to transfer from roof-to-roof to reach the 3-story apartment building a house away, they used an air-bed from one of our neighbors. I’m so thankful for the courage and quick thinking of Emily, and Edgar, one of our neighbors. It turns out Edgar was a ship captain and was prepared for such situations. Thank God!

5. Have some sort of alerting mechanism in place that would warn against floods, etc. Here in the office, I implemented an automated monitoring system on critical servers which automatically sends SMS alerts which I receive on my cellphone in case conditions that can lead to problems occur. For example, if the free space on the system drive of our e-mail server goes below a threshold we have set, all concerned I.T. staff including myself will receive an alert through a text message. I just wish that someone can come up with a similar system that would alert the City Government just in case an unusually high amount of rain fall occurs or if flood waters or water released from dams  are detected from surrounding areas that would eventually end up in Marikina City.  The City government can then alert residents or even evacuate them. Maybe I should forward this idea to PAGASA, they already have equipment that measure rainfall right?

6. The flood receded very fast so the problem is really with the source of the floods. Would you believe that the flood that reached levels as high as the ceilings of the second floor of houses in Provident Village receded by the next day? Yes, it receded that fast. In fairness to the efforts of the Marikina Government, I believe that the drainage systems are functioning as they should, but it just so happened that the flood waters, wherever it came from, was just too much. What if there was a way to at least control the source of the floods? Another  challenge, how can the drainage systems be cleaned of the mud (that will eventually harden) left behind by the flood waters?

7. Just sell the house and live in a flood free area! I know a lot of you have this in mind just like me. This would be the ultimate solution for me and my family unless someone finds a permanent solution that would result in a flood free Provident Village. I just wish selling the house would be easy. We could then move to another place in Marikina that was not affected by the floods. In case I decide to, I would have to wait for the village to be cleared of all the mud and debris before I can sell the house. Let’s wait and see…

Points to ponder from the point of view of a real estate investor

1. Do I renovate the house and construct a second floor and a roof deck or do I repair the house at its present configuration (our house is just a bungalow)? The obvious things I should consider would be the cost involved and if these can be recovered if I have our house rented out or sold down the road. For the same cost of constructing a second floor plus roofdeck, I could already have a new house constructed somewhere else that is flood free, which I can definitely sell for a profit or rent with positive cashflow in the future.

2. Do I sell the house now (after doing some repairs to make it ready for occupancy) or wait for property prices to stabilize after a few years? As mentioned above, property prices in Marikina have surely been affected by the recent floods. Demand is also very low while supply is very high as I’m sure a lot of homeowners already have their Provident Village houses for sale while there are very few people interested in buying properties in areas affected by the floods(except maybe for investors). If I decide not sell the house now, I should be able able to find tenants to at least cover part of the monthly amortizations for our house.

3. As an investor, I really should avoid flood prone areas! I’m just lucky that all of my investment properties were not affected by the floods and only my primary residence was hit. Just the same, I should also treat my home as an investment as I have mentioned in my recent post:  Why not treat your first home as a real estate investment?. As early as now, the implications I see are getting a negative cashflow if I do decide to have our house rented out, the difficulty of finding tenants/buyers for a bungalow in the middle of  Provident Village, the time it would take for the clearing up operations to finish(I estimate this to finish around Christmas time), and more importantly, the safety of those who would be living in our house.

What do you think?

To be continued…

*Photos of MCF and Father Suarez are courtesy of Cora Uy of REBAP-MRCI: http://www.rebapmarikina.com

**I would also like to thank all REBAP-MRCI and REBAP-QC members for the relief goods given to fellow REBAP members affected by the floods, including me and my family.




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Jay Castillo

A lot of people encounter problems and challenges when buying real estate like foreclosed properties. I encountered a lot of challenges myself, which is why I started this blog in 2008 to serve as a guide where I share lessons learned, and how to overcome challenges with real estate investing in the Philippines … [Read more] Get more from Jay : Facebook | Google+ | Twitter | LinkedIn
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