29/12/2023
📌Tips before Buying a Condo for Investment in the Philippines:
—Tip #1: Assess your financial capacity
Condominiums worth a million pesos. So before you start condo investing, assess whether you are financially ready for it.
If you will pay your condo unit on an installment basis, you must have a stable income to sustain the monthly payment.
‼️ Be sure that you qualify for a home loan ‼️
—it is important to note that lenders don’t just look at your monthly income. They also look at other factors, such as your debt-to-income ratio, to decide if they will be willing to lend you.
Lenders used this to measure your ability to pay your debts.
To get this, divide your recurring monthly loan payments, meaning the monthly amortization of the home loan you are applying for plus your other existing loans, into your gross monthly income. Then multiply it by 100 to determine how many percent of your monthly income goes towards your loan payments.
If it’s higher than 40%, then you may have trouble getting a loan.
Here’s a sample computation. A Php 3,000,000 home loan, payable for 15 years at a 6.5% interest rate, has a monthly amortization of Php 26,133 pesos.
If this property is your only debt, divide it into your gross monthly income, for example, 80,000 pesos a month. Expressed in percentage, that’s 33% debt-to-income ratio.
Since this is below 40%, the bank is more likely to approve your loan.
But, if, for example, you’re applying for the same home loan and your gross monthly income is Php 50,000 only, your debt-to-income ratio will be 52%.
Since it’s too high, the bank might deny your loan application unless you have a spouse or a co-buyer that can provide additional financial documents to add up your income.
So make sure that you consider this before applying for a home loan.
—Tip #2: If you do not have enough lump sum cash for condo investing, explore preselling condo projects for a lower monthly downpayment.
Gone are the days when you need to make lumpsum payments to invest in real estate.
Developers here in the Philippines offer flexible payment terms and a low monthly downpayment on their preselling condo projects.
Here, you can buy a condo before it is built or while it is being built, and these are called preselling condos.
Imagine by just paying the reservation fee, which is usually Php 10,000 – Php 50,000. You already secure the property under your name and lock in its current price and payment term.
You can then make money if the property value goes up in the next few months or years.
If you are a real estate investor, preselling condos are a promising investment since their market value can increase by the time they are finished.
And here’s the best thing about it. Since the condo is under construction, you will pay the downpayment, usually 10% to 30% of the total price, on an installment basis with no interest rate.
📌For more investment tips & advice, you may reach me through my:
📲 Mobile / WhatsApp / Viber: (+63) 939 914 0650
📧 Email: [email protected]
Thank You & God Bless!😊
For it is by grace you have been saved, through faith—and this is not from yourselves, it is the gift of God— not by works, so that no one can boast (Ephesians 2:8)
Sales Manager:
April M. Congmon
PRC OR No.: 17757057A
DHSUD: 04880905
—CTTO source: investstate.ph
