Is It The Right Time To Buy A Rental Property In The Philippines

    There are two reasons people buy rental properties – to make money or make investments. After those, the following most common reason is for capital appreciation purposes. This means that you are buying a property intending to sell it for more than what you paid for it sometime in the future.

    The Philippine real estate industry is distinct yet undervalued. The continuous economic growth and maturation intrigued both local and international investors despite pandemic woes. 

    However, is it really the best time to take the plunge? Of course, it is not right to decide on the spur of the moment or without thorough research. That being said, let us help you weigh the pros and cons with regard to investing in Philippine real estate.

    New opportunities keep abounding in the PH.

    Real estate industry is expected to boom despite difficulties and disruptions brought by the CoVID-19 global crisis, rising vacancy rates, depressed market, and declining rents, the real estate industry here is expected to boom! 

    New opportunities are emerging while the country is in its recovery mode as per the “Postpandemic Path for PH Real Estate” webinar. This has been hosted by the Property Section of the Philippine Daily Inquirer. 

    “For the office market, I think this is a very good opportunity for companies that are continuously growing—those from e-commerce, health information management, logistics sectors—to secure better deals. As I mentioned, lease rates are down 20 to 30 percent in selected business districts, and now is really a very good time to lock deals while lease rates are desirable,” says Joey Roi Bondoc, the associate director of Colliers Philippines. 

    Whether you are an investor or a renter, make room to see the good things in the Philippine real estate industry.

    Although travel restrictions and localized security concerns have prevented foreign buyers from entering the country, there are still investors who have secured deals. This is something that has allowed local investors to exploit the foreigner’s hesitation.

    “For the residential market, if you’re an investor and a user, now is a good time to buy because mortgage rates are still competitive and attractive—6 to 8 percent. We’re no longer seeing the 20 to 22 percent mortgage rates during the Asian financial crisis,” Bontoc added. 

    How to know if it is the right time to buy?

    Investing in a property, especially a rental property, requires more than just the purchase price. Before putting down your money on this asset, there are many factors to consider. It must be understood that there is a need for careful research and careful evaluation of the market trends before you buy any rental property.

    Risks involved include:

    • Escrow delays.
    • Delays in receiving all forms of income.
    • Temporary vacancy or abandonment of the property.
    • Other unforeseen circumstances.

    Prepare before you invest.

    Whether you are a new or experienced investor, it is best to take all possible precautions first. There’s no way of knowing what lies ahead, so it’s best to be prepared for anything. If property investment is your goal, here are some things that you need to do:

    1) Check if the market is truly on an upswing. Having solid information can help avoid making huge mistakes by buying a property at the wrong time.

    2) Enquire about the average per unit price of the property in terms of rent. If it is below market price, you can consider renting it out while searching for another property that fits your needs. Or, if you have enough capital, buy at the current market price but be sure to check the history and projected trends of the place.

    3) Talk to different agents. Ask them questions about the neighborhood and its growth trends. You can also ask about the property you are planning to buy.

    4) Talk to investors. If you have friends or relatives who are already investors, you can ask them how it worked for them and how they were able to manage. Feel free to get info from the web, magazines, newsletters, and other sources of information.

    5) Check your budget and be realistic. Before buying a property, determine if it is really within your means. In addition to the purchase price, don’t forget to budget for possible renovations, maintenance costs, property taxes, and interest payments.

    6) Look at the place with a critical eye. You need to look for any signs of structural problems or pest infestations since you will be responsible for those after the purchase. In case you have to negotiate with the seller, you have to be able to defend your position and your offer.

    7) Make sure that the property has a solid title. Check if there are any liens or other encumbrances on the property.

    The Bottom Line

    Investing in Philippine real estate is not always profitable, but it can be rewarding. In addition, it can be a great way for people to build their wealth. The Philippines is a welcoming place that has something for everyone. Therefore, it is crucial to know where to look and what to do to facilitate buying and owning property in the Philippines.

    Related Articles

    The Philippines’ Top Real Estate Developers

    1. Ayala Land Unquestionably one of the biggest and most reputable real...

    Comments

    Same Category

    The Philippines’ Top Real Estate Developers

    1. Ayala Land Unquestionably one of the biggest and most...

    Rent-To-Own Know-Hows In The Philippines

    Buyers and sellers may discover that participating in a...

    Contemporary clean bathroom with gray walls and exposed bath tub

    All of these islands have pristine shores, swaying palm...
    spot_img