Investment Home Buying is Like First Home Buying
Here are some links from Yahoo Finance on buying your first home. These guidelines hold true even for those who may be buying their 2nd or nth home, for end use or for investment. See our extra notes on how it differs when buying in Manila while based abroad.
Buying Your First Home --If you're based outside the Philippines you'll probably consider getting a house or condo for investment, for a holiday home, for retirement or for an anticipated return to Manila. If so, be upfront with your broker or agent about your expectations, needs, priority locations, what you can afford.
Most importantly, consider your time frame to purchase the property; manage your own expectations and your broker's. If you intend to buy in a year's time, start looking at most only 5-6 months before then. Don't frustrate yourself.
How Much Mortgage Can You Afford? --As brokers we just divide your average monthly net income by 3 (if you'll be so kind to tell me!). That's a rough estimate of how much mortgage expense We do that whether your earning in euros, francs, yen, or USDs.
Costs of Buying a Home --In the Philippines the home inspection costs usually would refer to bank appraisals fees on the collateral (or house) if you're taking out a local-based finance package. This appraisal cost is part of the application fee, where you pay from Php 2,500 to Php3,500 per appraised collateral. Other bank fees are billed after approval of the loan and your actual availment. Other transfer and registration costs you will pay to enable the transfer of the title to your name: the balance of the real estate taxes & association dues for the year from the date of sale, transfer taxes, documentary stamps, registration fees, facilitation fees (which may be 'expedite' fees to process the title transfer at the government agency concerned--this is the quick and dirty way to do it), fees for transferring utilities to your name, and the new member fees as a new resident in the association.
Ongoing Costs --an older home of quality build is cheaper to buy, has bigger space, and sometimes has better wood for the main framework. But buy secondary market homes that need only minimal repairs. That means no need to tear down major walls, overhaul the roof, change electricals or repair foundation structures which require a more sizable renovation budget. You won't be around to oversee the repairs; more importantly the total cost difference may be very minimal as compared to buying a ready-for-occupancy house!
Choosing a Neighborhood --choose a neighborhood you're familiar with: those with good water, security, community facilities, proximity to work or school locations, or whose location offers key strengths. BF Homes Paranaque, for all its problems with village-based water supply, still is popular with buyers South of Metro Manila for accessibility of its location, for its efficient, micro-managed community associations, and for its self-sufficiency of facilities. Ayala Alabang is bannered as an affluent, secure neighborhood of the South. However, one can find a home in other well-secured and well-to-do communities in Alabang. For this Alabang Hills, Pacific Village, Hillsborough, and Pacific Malayan Village are worth exploring.
Finding a Broker --check the credentials of the broker (and in fact, check if he is really a licensed broker or a legitimate agent), ask your relatives to refer one to you, or simply e-mail us and see how we can meet your expectations!
In the next posting, we'll talk about documentation required to buy or sell your home if you are not living in Manila.