Lesson 2 · 7 min read · Last reviewed
Lot Area vs Floor Area Philippines: Price per Sqm Guide
Formula for price per square meter, when to use lot area vs floor area, and area conversions (hectare, acre). Practical examples for comparing Philippine properties.
Quick Answer
Price per square meter (P/sqm) = Total Price ÷ Total Area. For lots, use the lot area from the TCT. For condominiums, use the floor area from the CCT (not the lot area allocation). Floor area is the usable internal space; lot area is the land. Always verify area from the title document, not the seller's marketing materials.
Computing Price Per Square Meter
“The description shall contain the bearings and distances of the boundaries of the land, the area thereof as determined by survey, and such other data as may be necessary to identify the land. The area shall be stated in square meters.”
What This Means
Price per square meter (P/sqm) is the universal metric for comparing property values. Formula: P/sqm = Total Price ÷ Total Area (sqm). This allows fair comparison between properties of different sizes. For lots: use lot area. For condominiums: use floor area (the unit's internal area as stated in the CCT). For house-and-lot: you can compute separately (land P/sqm and improvement cost/sqm) or a blended P/sqm. Always verify the area from the title, not from the seller's verbal claim or marketing materials.
- FormulaP/sqm = Total Price ÷ Area in square meters
- For lotsuse the lot area from the TCT
- For condosuse the floor area from the CCT
- House-and-lotcompute lot P/sqm and building cost/sqm separately for analysis
- Always verify area from the TITLE, not from marketing materials
Real-World Scenario
Three lots are for sale in the same village: Lot A is 150 sqm at P3,750,000; Lot B is 200 sqm at P4,800,000; Lot C is 180 sqm at P4,500,000. A buyer wants to determine the best value.
Which lot offers the best price per square meter?
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Lot A: P3,750,000 ÷ 150 = P25,000/sqm. Lot B: P4,800,000 ÷ 200 = P24,000/sqm. Lot C: P4,500,000 ÷ 180 = P25,000/sqm. Lot B has the lowest P/sqm (P24,000), best value purely on price. However, other factors matter: lot shape, frontage, corner vs. interior, and proximity to amenities. P/sqm is a starting point for comparison, not the final decision factor.
Floor Area vs. Lot Area vs. Gross Floor Area
“Floor area shall mean the area included within the surrounding walls of a building exclusive of courts, and vent shafts. Gross floor area shall mean the total floor space within the perimeter of the permanent external building walls, occupied by: office and work areas, corridors, lobbies, mezzanine floors, and vertical penetrations which are designed as part of or directly connected to a stairway.”
What This Means
Three area concepts are critical: (1) Lot Area: the total land area from the title/survey, measured in square meters. (2) Floor Area: the usable internal area of a building/unit, excluding walls, shafts, and common areas. This is what you "live in." (3) Gross Floor Area (GFA): the total built area including walls, corridors, and service areas. For condos, the CCT states the unit's floor area. For house-and-lot, the tax declaration shows the building's floor area. Understanding these distinctions prevents overpaying: a 50sqm condo unit (floor area) in a building with 40% common areas really sits on only 30sqm of land allocation.
- Lot areatotal land from the TCT survey (what you OWN on the ground)
- Floor areausable internal space of a building/unit (what you LIVE IN)
- Gross Floor Area (GFA)total built area including walls and common areas
- Condo CCT shows FLOOR AREAcommon areas are shared proportionally
- HouseLot area from TCT, Building area from tax declaration/building plan
Real-World Scenario
A developer advertises a condo unit as "55 sqm" at P150,000/sqm = P8,250,000. The buyer reviews the CCT and finds the floor area is only 45 sqm. The 55 sqm includes the balcony (5 sqm) and the proportionate share of the hallway (5 sqm).
What is the true P/sqm of this unit?
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Using the CCT floor area (45 sqm): P8,250,000 ÷ 45 = P183,333/sqm, significantly higher than the advertised P150,000/sqm. The developer included non-floor-area components to make the price look lower. For comparison purposes, always use the floor area on the CCT. The balcony (semi-open) and hallway share are not "floor area" under the Building Code definition. A broker should clarify this for buyers and compare using consistent definitions.
Area Conversions and Measurement Standards
“The metric system of weights and measures shall be used in all government communications, transactions, and publications. For purposes of land measurement and registration, the square meter shall be the standard unit of area.”
What This Means
While the official unit is square meters, many Filipinos still use older measurements in casual transactions. Key conversions: 1 hectare = 10,000 sqm. 1 acre = 4,047 sqm. Old Spanish measurements still appear in some rural titles: 1 quiñon = approximately 2.8 hectares, 1 balita = approximately 2,795 sqm. For lot frontage and depth: multiply frontage × depth to get the approximate lot area (for rectangular lots only). For irregular lots, the actual surveyed area from the title prevails over any manual calculation.
- 1 hectare = 10,000 sqm (the standard large-area unit)
- 1 acre = 4,047 sqm (sometimes used in farm listings)
- Rectangular lotArea = Frontage × Depth
- Irregular lotsonly the surveyed area from the title is official
- Always use sqm for pricing comparisonsconvert other units first
Real-World Scenario
A broker is comparing two farm lots: Lot X is advertised as "2.5 hectares at P500/sqm" and Lot Y is advertised as "5 acres at P12,000,000 total." The buyer wants to know which is cheaper per square meter.
Which lot has the lower price per square meter?
Show AnswerHide Answer
Lot X: 2.5 hectares = 25,000 sqm. Price = P500/sqm. Total = P12,500,000. Lot Y: 5 acres = 5 × 4,047 = 20,235 sqm. P/sqm = P12,000,000 ÷ 20,235 = P593/sqm. Lot X is cheaper per square meter (P500 vs P593). However, Lot X is also a larger total area (25,000 vs 20,235 sqm) with a higher total price (P12.5M vs P12M). The buyer should decide based on how much land they actually need and their budget, not just the P/sqm.
Frequently Asked Questions
How do I compute the price of a house and lot separately (land vs. building)?
Method: (1) Get the land value by checking comparable lot-only sales in the area (P/sqm × lot area). (2) Estimate the building value using the replacement cost approach: construction cost/sqm × floor area, minus depreciation. Common construction costs: P20,000-40,000/sqm for standard residential, P40,000-80,000/sqm for mid-rise condo. (3) Compare: Land value + Building value vs. the asking price to determine if the property is fairly priced.
What is a "lot cut" and how does it affect pricing?
A "lot cut" is the standard lot size offered by a developer in a subdivision (e.g., 80 sqm, 100 sqm, 120 sqm cuts). Smaller lot cuts are usually priced higher per sqm because of higher demand and lower total price entry point. For example, an 80 sqm lot at P30,000/sqm (P2.4M total) vs. a 200 sqm lot at P22,000/sqm (P4.4M total). The smaller lot is more expensive per sqm but more affordable in total.
Should I compute P/sqm based on lot area or floor area for a condo?
For condominiums, always use FLOOR AREA (from the CCT) for P/sqm computation. This represents the actual usable space you are buying. Lot area allocation (your proportionate share of the total lot) is relevant for zoning and density discussions, but NOT for pricing comparisons. When comparing condos, ensure you are comparing floor areas on the same basis: some developers include balconies, some do not.
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