Things Nobody Tells You When Buying Property in the Philippines

As I was growing up, I had steadfastly believed in life’s golden formula which had consisted of two very straightforward steps:

*In your early twenties, you graduate from school, find a job, gain a firm traction on your everyday tasks and progress through your job ladder and then earn enough money to save.

*By your mid-twenties, I had expected that everyone would save money–enough for them to get married, start a family and perhaps purchase their very own property.

Sounds pretty generic and formulaic right? However, this type of skewed dichotomous process of owning your very own property rarely comes into fruition. If it does at all, then lucky you! Give yourself a pat at the back. But for most of us, this course is hardly realistic. Needless to say, I am in my mid-twenties, unmarried and with barely enough savings to last me a month’s supply of food.

The truth in purchasing property is not always as clear and straightforward as it should be—even when you already have enough money saved to own one. In fact, more often than not, there are things that not even your real estate agent would disclose. To get around the things you should know but are not told, read on.

REAL ESTATE JARGON IS A REALITY

When you are a potential buyer, you look for property ads. You often come across terms such as “pre-selling condo”, “rentals” and etc. However, these are relatively easy terms that most buyers can comprehend. Meeting your real estate agent face to face, however, is an entirely different story. Terms such as “amortization” (your monthly down payment being spread out), Tripping (on site property viewing).

How should you avoid this?

While you are still looking for potential properties to purchase, research the common real estate terms as well. And while you are at it, it might be helpful if you looked up some legal jargon that might involve owning property so as to keep your conversations with your real estate agent flowing and spontaneous.

THERE ARE CHARGES THAT DO NOT NECESSARILY REFLECT ON THE SELLING PRICE

Project developers offer you unrealistically low prices in order to lure you, However, this can often be very misleading because there are charges that are not disclosed. Keep in mind that when you are purchasing seemingly cheap condominium units, there are still expenses you should account for. Some of these charges may be a reservation fee, closing costs and a monthly down payment to name a few.

How should you avoid this?

Apart from saving enough for the initial expenses you need to pay, you should also acquaint yourself with the list of expenses and account them for so that you can set savings for them as well. Real estate experts would advise would-be property buyers to save up to twenty percent for the down payment.

PAYING IN DOWN PAYMENT IN INSTALLMENTS IS POSSIBLE TILL THE PROJECT IS COMPLETELY FINISHED AND BUILT

Shelling out an enormous amount of cash for the down payment is a daunting idea and may even ward off potential buyers. In order to get around this, real estate developers now offer payment terms that are more affordable and easily attainable even by young Filipino professionals. This includes allowing potential buyers to pay for their down payment in installments.

Preparing for it:

Do not leave yourself entirely penniless just so you can afford the down payment. Apart from saving for the down payment, it would be helpful if you have three months’ worth of monthly payment reserved. This would also assist you in staving off extraneous expenses.

BUYING A HOME ENTAILS PAYING REAL PROPERTY TAX ANNUALLY

Once you have finally purchased your first property, you are expected to pay for real estate property taxes every single year. Real estate taxes may vary depending on where you live and at times, it could be quite exorbitant.

Preparing for it:

Factor in this as a criterion when you are still selecting and searching for a home. Acquaint yourself with the property tax laws in the city where you may choose to reside in. Just keep in mind that should you fail to pay your real estate property tax, the government may put your house up for public auction.

NEGOTIATION ON PROPERTY PRICES MAY HAPPEN

Depending on the generosity of your project developer and real estate agents, this can often happen. There are a few brokers and agents who are willing to give up their commissions so they can offer you a better discount on the property you want to purchase.

Preparing for it:

Haggling is commonplace and you should be confident enough to discuss this with your broker. Ask people who have already purchased property before and find out how they negotiated the property prices. Remember, your broker is striving for a sale and as long as you are willing to buy, that would be enough for your broker to agree on a well negotiated and a reduced offer.

Are you ready to own your very first property yet? If you are, brush up on the things that have been listed on this article and begin your property hunt.

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