Total Contract Price (TCP)
Total Contract Price (TCP) is the full purchase price of a property as stated in the Contract to Sell or Deed of Sale. Includes the unit cost but excludes closing costs (taxes, fees, registration). The basis for computing down payments and loan amounts.
📄 Overview
The Total Contract Price (TCP) is the full amount a buyer agrees to pay for a property as stated in the contract to sell. The TCP is the basis for all payment calculations, financing arrangements, and tax computations. It represents the total cost of the property before any discounts, and does not include taxes, transfer fees, or other transaction costs.
📄 What TCP Includes
For condominiums: the unit price (based on floor area), parking slot (if included), and any mandatory charges (connection fees for water/electricity). For house-and-lot: the lot price plus the house construction cost. The TCP does NOT include: association dues, real property tax, title transfer costs (CGT, DST, transfer tax, registration fees), moving-in costs, interior furnishing, or loan processing fees. Buyers should budget an additional 8-12% of TCP for these transaction costs.
📄 TCP vs. List Price
The list price (or advertised price) is the developer's published selling price. The TCP is the price in the actual contract after negotiations and any applicable discounts. Spot cash discounts (10-20%) reduce the actual payment but the TCP may remain the same on paperu2014the discount is applied as a deduction. For pre-selling properties, the TCP is fixed at contract signing and does not change regardless of market price movements during construction.
📄 Financing Based on TCP
Bank loans are calculated as a percentage of TCP (the LTV ratio). Example: TCP of PHP 5M with 80% LTV = PHP 4M loan amount. The buyer pays the 20% balance (PHP 1M) as downpayment. Pag-IBIG loans are based on actual need up to the maximum loanable amount. In-house financing covers the full TCP minus any downpayment already made.
🇵🇭 Philippine Context
The TCP is the price declared in the contract to sell, which is registered with DHSUD as part of the license to sell requirements. Under PD 957, developers must disclose the TCP and all payment terms in the contract. The BIR uses the higher of TCP or zonal value to compute the Capital Gains Tax. Under the Maceda Law, refund calculations are based on actual payments made toward the TCP. Buyers should ensure the TCP in the contract matches what was agreed upon and includes all property components.
🔗 Related Topics
Loan-to-Value Ratio, Spot Cash Payment, Deferred Payment, Bank Housing Loan, Reservation Fee