Millennials are predicted to shape the real estate landscape of the Philippines in the coming years. According to the 2013 National Association of Realtors study about generational housing trends, “… those born between 1980 and 2000, are the second biggest segment of home buyers, behind Generation X (those born between 1965 and 1979). One of the biggest reasons why the Pinoy millennial has the purchasing power to invest on real estate is that they are not burdened by student loans, unlike their US counterparts. Thanks to their parents’ emphasis on college education, most of the Filipino millennial graduate debt-free, and therefore have more financial freedom.
But great financial power comes with great financial responsibility. While the Pinoy millennial are a bit more cautious in where they put their money is, compared to their predecessors, they are also more likely to get sidetracked by trends and what their peers are investing in. And as condo living is gaining traction in metropolitan Manila, it pays to make an informed decision before hopping in the bandwagon.
Here are a few things millennials must look into before buying a condominium:
Before you even decide to jump into vertical living, you must first figure out why you need a condo for. Are you planning on leasing it in the future? Or do you plan to settle in a condominium unit? Your purpose will determine what type of investment you’ll make, the location, and other factors you’ll need to consider before buying a condo.
The initial investment for obtaining a condominium is just the tip of the iceberg. Millennials have to be financially prepared to pay for other costs in maintaining a condo unit, such as parking costs, realty tax, association dues, and utilities. Hence, it is crucial that you have a budget set aside monthly to cover these charges, on top of the mortgage.
The condominium’s location
Consider not only the proximity of your chosen unit to your workplace, and other places of conveniences such as shopping, business and leisure establishments. You also have to check other factors, such as the safety and security of the neighbourhood and the traffic situation of the surrounding highways and streets. This not only guarantees the convenience of yourself or your family (if you’re going that route), but also the future value of the property.
The type of condominium
Each type of condominium units has their own set of benefits. Pre-selling units, for instance, are much cheaper than RFO’s, while high-rise condominium units offer more amenities. It is important that you determine first your purpose for buying a condominium unit as this will help you decide on what type of condominium fits your immediate needs.
Access to amenities
Condo living affords residents with amenities and features that are normally not available within reach to those who own residential properties. However, these perks may not always be easily accessible. Sometimes, you’ll have to contend with certain restrictions, additional fees and the fact that you’ll be sharing the same amenities with the rest of the community. Ask the developer about your access to the amenities before buying the property.
The right developer and agent
The Philippine real estate scene is rife with horror stories of projects not coming to fruition after the pre-selling mortgages have been paid for, or colorum real estate brokers running off with the investor’s money. However, you can avoid these woes by doing your research first. Make sure the property developer has a solid track record for project turnovers, and that the agent you are getting is licensed.
Future marketability of the condo unit
Do consider that at some point in your life, you are bound to sell or lease your condominium unit as priorities change. And even if you don’t plan to for sentimental reasons, understand that condo units, unlike residential properties, have depreciating value over time. Hence, it is therefore crucial to ask the developer the lifespan of the project, and how resaleable it will be in 5-10 years.