Need advice: rent or purchase a home

[dreamur]

Investing in DMCI projects in Acacia used to be the right decision 8 years ago since I work in BGC. The price was P54K/sqm then. It hasnt appreciated much plus the traffic has tripled now after more condos opened and car down payment has become cheaper. The better option is BGC but condo prices has soared rediculously to P170K/sqm.

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[yebo]

I'm assuming that renting out a 2 bedroom unit is more challenging since the target market is smaller...i'm thinking starting families. If we'd factor in renting it out later on sa decision then maybe getting a smaller unit is better? Para wider market...yung young professionals?

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ang alam ko 2 br units are more in demand. 5 or 6 call center agents can share a 2 br unit for 25k-30k making their share 5k each. a 1 br unit for 18-20k shared by 2 costs more. ang magrerent nyan na magisa lang kalimitan mga "model". pag wala na si daddy iiwan ka bigla. or worse talbog tseke.

[Wh1stl3r]

The cost of a townhouse in the location that I want is 4x that of a condo. So my income needs to quadruple to afford it.

Oh, pwede rin palang longer loan term. But having 20% DP for a townhouse still takes quite a lot of money.

Yup townhouses are a lot more expensive. But if you can afford it, still the better and safer choice, I think.

Location is another thing. Be on the lookout for possible or on going developments in the area. Traffic conditions will change depending on these developments.

[jut703]

Yup townhouses are a lot more expensive. But if you can afford it, still the better and safer choice, I think.

Location is another thing. Be on the lookout for possible or on going developments in the area. Traffic conditions will change depending on these developments.

I already have my sights on a location where I want to get a house/townhouse. A few promotions pa, baka kayanin na. Big help also if my girlfriend starts earning.

Hayy, the millennial problem - land prices are skyrocketing faster than incomes are rising.

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[SuperQuest]

I think you ask a question which the answer may seem self evident. I'm not so sure, even though I bought a condo about 5 years back. It may well be that purchasing a home is marginally more cost effective in the long run - from a purely financial perspective.

When I bought the condo, it was at 2.5m and now sells for just over 3m. Parking is 700k. Off the top of my head I would have paid around 4.5m including interest when the unit becomes mine officially - excluding taxes.

Over the same 10 year period, renting the same unit with parking will come to 3m.

There are two benefits of owning the unit:
1/ I could sell for a profit, and as it stands that means in the region of 500k to 1.2m, ignoring any costs I will incur in order to get the best price.
2/ In case of emergency, it is a store of value so could either get an equity loan, or sell outright.

Renting on the other hand confers:
1/ I could move if I move jobs, if I decide I want pets, or simply because I want a larger place. 27 sqm for two is hardly comfortable, particularly if I want to really enjoy my home.
2/ I dont have to deal with taxes and substantial home improvement costs.

Juxtaposed against the 1.5m premium for home ownership excluding taxes, the value of home ownership becomes questionable.

I submit that some areas would appreciate much more, and therefore prove to have better financial value. The only thing is one needs the ability to foresee which units and areas will have substantial increases over an agreeable period. I dare say this is not as simple as it sometimes is made out to be, else we would be awash with real estate millionaires.

That said, I will most likely purchase a house and lot down the line, as it will allow me the freedom to pursue a number of hobbies. It will also give me comfort in retirement that I,d have 1 less cost to worry about - though I still have to pay taxes! The alternative to this is having a strong investment strategy (which I dont). Typically, prudent and diligent (think peso cost averaging) investment in blue chip stocks and government bonds will produce 12% returns per annum, which could offset rent costs.

My two centavos.


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[Wh1stl3r]

I already have my sights on a location where I want to get a house/townhouse. A few promotions pa, baka kayanin na. Big help also if my girlfriend starts earning.

Hayy, the millennial problem - land prices are skyrocketing faster than incomes are rising.

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I know how you feel bro. But that problem isn't exclusive to millenials. Aside from being prohibitively expensive, it's hard to find value in Metro Manila properties. Unless you find some hard up property rich owner who is desperate for cash. Or an expat who is suddenly reassigned to another country.

Things aren't as bad in the outskirts. For the same price of a mid-range 2/3 bedroom condo I was able to buy a decent sized commercial property along the national highway. The simple life has its perks hehe.

[vinj]

I know how you feel bro. But that problem isn't exclusive to millenials. Aside from being prohibitively expensive, it's hard to find value in Metro Manila properties. Unless you find some hard up property rich owner who is desperate for cash. Or an expat who is suddenly reassigned to another country.

Things aren't as bad in the outskirts. For the same price of a mid-range 2/3 bedroom condo I was able to buy a decent sized commercial property along the national highway. The simple life has its perks hehe.

Precisely what I'm doing. Manila is too expensive so I'm fine to maintain an, easy to lock up and clean condo that fits us comfortably. If I build, it will be outside (and hopefully we can find employment there). I'm tired of Manila.

[dreamur]

It is amazing to find a 3BR single detached house in Bacoor at 1/3 the price of a 1BR condo in BGC.

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[_Cathy_]

It is amazing to find a 3BR single detached house in Bacoor at 1/3 the price of a 1BR condo in BGC.

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I wouldn't live in Bacoor even if they paid me. The commute would be a total nightmare.

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[EQAddict]

Hehehe i live in QC. You dont know what a nightmare commute is until you do my commute (katipunan, edsa, makati). Having said that land prices here are sky rocketing traffic be damned.

I have invested heavily in real estate. Nothing in my opinion has appreciated as fast as BGC (condos) and land in the city. Of course if i had LAND in makati id live there hehe. But i dont.

My advice is rent for two years then take the plunge into real estate when your career is on the upward trajectory. You will always want to upgrade and upsize when youre this young. So dont buy now. If you lock yourself in now.....2 years hence when you have more money and can afford a bigger place, you might regret being shackled into a long term contract.

Rent first....get hungry.....then go for it.

Home ownership means capital appreciation. If you're into that sort of thing. Others want the freedom of being a renter....but you will never have the capital gains that the landed will have. Unless you're an investment genius like Warren Buffet.....



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[dr. d]

I wouldn't live in Bacoor even if they paid me. The commute would be a total nightmare.

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i'd live in bacoor, if i worked in bacoor.
it's relative.

[EQAddict]

i'd live in bacoor, if i worked in bacoor.
it's relative.

Correct.

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[lowslowbenz]

It is amazing to find a 3BR single detached house in Bacoor at 1/3 the price of a 1BR condo in BGC.

Exactly. This is why I bought a house further down the road, in Imus. Working in Makati, living in Imus.

I'm still alive .........

Sanayan lang yan.

Plus, you have a proper garage for your car, a small yard to entertain friends over some BBQ, etc ...

[_Cathy_]

Hehehe i live in QC. You dont know what a nightmare commute is until you do my commute (katipunan, edsa, makati). Having said that land prices here are sky rocketing traffic be damned.

I have invested heavily in real estate. Nothing in my opinion has appreciated as fast as BGC (condos) and land in the city. Of course if i had LAND in makati id live there hehe. But i dont.

My advice is rent for two years then take the plunge into real estate when your career is on the upward trajectory. You will always want to upgrade and upsize when youre this young. So dont buy now. If you lock yourself in now.....2 years hence when you have more money and can afford a bigger place, you might regret being shackled into a long term contract.

Rent first....get hungry.....then go for it.

Home ownership means capital appreciation. If you're into that sort of thing. Others want the freedom of being a renter....but you will never have the capital gains that the landed will have. Unless you're an investment genius like Warren Buffet.....



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But your parents have land in Makati so that's practically yours too Magallanes is relatively cheaper, you don't like?

i'd live in bacoor, if i worked in bacoor.
it's relative.

Well yeah. That's why my parents would only allow me to work close to home :P I'm so glad I listened

But traffic is so horrible now, I timed in once, took me 30 mins for a one kilometer stretch (this was at 5:30 pm)

[Wh1stl3r]

Exactly. This is why I bought a house further down the road, in Imus. Working in Makati, living in Imus.

I'm still alive .........

Sanayan lang yan.

Plus, you have a proper garage for your car, a small yard to entertain friends over some BBQ, etc ...

+1. That's also what I mean in part by value. Space to stretch out. Plus the air is cleaner, the nights quieter and the views better.

Commercial property in the outskirts appreciate fast too. Maybe not as fast as BGC condos but it's the residential ones that take a lot longer to appreciate.

[MR_BIG18]

we have a few studio type rooms(28sqm)here in pque, most of my tenants are couples without kids pa...they move out once they are ready to have kids or they have the budget to get a bigger place

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[dr. d]

"i wonder... does 'rent-to-own" really work?"
i mean, what advantage does it have, over the traditional "hulugan" ?

[benchman]

"i wonder... does 'rent-to-own" really work?"
i mean, what advantage does it have, over the traditional "hulugan" ?

i might be wrong; much less interest with rent to own.
you pay as if you're just renting the unit? with longer term?

[x.mayor]

rent first, don't settle yet!

if you're both working, it will be totally a whole new world when baby came in the picture. believe me there's scarcity of good "yayas" nowadays! usually, the option is to move near your parent's or in-law's place or have 1 of them with you to look after your child (in case your parents or in-laws are still living and able).

on my own experience, we finally settled for our own house after 10 years of renting. on the first 2 years, we rented a small apartment near my wife's office. when the first baby came, we transferred to an apartment near my in-laws place so they can look after the baby (with the house-help/yaya) when we're at the office.

[_Cathy_]

40k sq/m daw sa teacher's village? Ang dami ko kasi nakitang townhouse na 3 floors. My Tita just moved there. Nasa 15M mga bagong townhouse dun? !? Pero ang lapit daw nila sa Ateneo

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