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6 Common Fears Why Filipinos Don’t Invest in Real Estate

The real estate market, though tense, has proven itself to be a great way to build wealth for those who invest in it. Investment tools such as Real Estate Investment Groups have made investing more effortless, accessible, and easier for Filipinos, but the number of investors remains low.

There are a lot of factors that keep Filipinos from investing in real estate, even in a country that is explicitly popular for the real estate market. To know what is stopping them from investing in real estate, we discuss six common fears that affect the investment decision of the Filipinos.

Lack of Knowledge

Some people find investing very complex to learn and don’t give much time or thought. They fear that they might end up in significant losses with the lack of proper knowledge. However, with the help of professionals or a good realtor, investing in real estate can be a little simpler. If you know a reliable expert, you can explore your investment options with a bit of assistance.

Low Income

The most obvious reason for low investment numbers is the low income of many citizens; lack of backup money makes investing impossible. People cannot give their limited savings on things that require huge investments. Another thing about real estate is that it is beneficial in the long term, so for some people waiting long on return option goes off the table.

Cash Flow Mind

Some people don’t want to waste their budget or limit it by adding things they don’t see. They will pay a monthly premium for a vehicle rather than an insurance premium. It is difficult for some people with a cash flow mind to comprehend that real estate investments can get them more than any cash flow transaction.

Distrust

When you start investing, it means you will be handing over your assets to a professional or company that will spend your money on their businesses. People face these problems of market trust and believe thieves are everywhere. That’s why instead of investing their extra money, they choose to spend it.

Impatience

Everyone wants immediate results, but investing does not work that way. The idea of waiting is a massive blow to many Filipinos. Waiting is hard for some people, especially those who treat everything as an emergency and treat it the same way if they invest in real estate.

Incorrect Definition

A common mindset believes that real estate investment is for the rich or the elderly who want to prepare for their old days. Most people are reminded of death when hearing of life insurance. Also, when talking about stocks, there is a thought that the market will collapse. But these things we learned about investing are a result of biased opinions. It is essential to educate yourself financially and learn more about what we fear.

Most Filipinos live in the present and try to stay happy with what they have, but it is vital to recognize the difference between our wants and needs. Our finances require equity, even if it means investing in real estate. Investment may not be for everyone, but you need to explore it first to be sure about it. Get into real estate investing with the help of a reliable platform and broker and know more about it to overcome your fears.

Is Philippines Property Investment the Best in the World Today?

Published Date : January 19, 2022 Article Buying Property Financing Industry News News Property Recommendations Real Estate 101

If you plan to invest in real estate worldwide, then the Philippines might be the best choice. The value of property in this country has been rising as more and more foreigners are taking an interest. There is a global demand among locals, so everyone is seeking more real estate opportunities.

Like other Southeast Asian countries, the Philippine real estate market also got weaker during this pandemic, but that also favors buyers. International investors take advantage of the situation and keep an eye on the foreign markets expecting a good deal.

Philippine real estate investments are considered among the top globally for many reasons. The current period in the Philippines is regarded as the golden age of infrastructure and can be the best investment time.

Good Rental Yield

Gross annual rental income is the return a landlord gets from their investment (before taxes). Comparing the rental yield of countries in Asia, the Philippines ranks at the top with 7.9%. It is a good indicator that a country performs well in real estate.

High Demand

On the prospects of better job opportunities, education, and facilities, many Filipinos are migrating from rural to urban cities like Makati, Cebu, and Metro Manila. This migration is a prominent reason for the increased demand for houses and rental properties in metropolitan cities.

The locals and expats are returning for retirement, foreigners are planning to settle in, and many tourists extend their stays in the Philippines. Steady growth in demand for housing has been seen.

The Philippines has a lot to offer as it is a very progressive country. With this technology and transportation advanced time, traveling across the seas is convenient for people. Understandably, people want to reap the benefits and take advantage of the opportunities, even if they are in another country. With the ease of globalization, you can quickly become a part of foreign real estate investment. Data of its growing economy shows that the Philippines has performed steadily well for many years. If we talk about the Philippines’ gross domestic product, it has risen since 1960. So there is no wonder why Philippine property investment is among the best in the world today.

Buying a Condo. Who is Running the show?

Published Date : April 20, 2020 Property Recommendations Real Estate 101

When buying a condo, we are all seduced by the decor, the ambiance, the view, and other visual effects, when we should really be checking something else that is not visual!

The Home Owners Association (HOA) often plays a very nondescript part in the whole process of choosing a condo, – especially for first-time condo buyers. However, the HOA can play a very large part in using up your finances if you hit an unlucky situation after moving in.

In order to avoid a surprise, ask a few pertinent questions about the HOA. One of the important factors would be ‘who is running the show?’ In a very small condo complex it may be run by residents, but a professional management company is preferable, especially in a condo of any size.

Professional management companies do charge for their services, but they can often save this fee by obtaining lower quotes for repairs, because they will use the same company many times. There is also less chance of the company using their influence on resident votes, so they may be construed as more fair. Finally, it is a business to them, and it the HOA will be run as such, instead of as a part-time rush before each meeting is due!

Always ask to see the rules of the HOA, the financial report, the by-laws and the minutes of the last several meetings. The conditions, covenants and restrictions (CC&Rs) will affect your lifestyle, so make sure they ‘fit in’ with it.

The financial report will tell you if there are any big increases in the fees coming up, or if there are any ’emergency’ fees due soon. This raises the important question, what will happen if there is a big emergency? How is it paid and how much money is in the HOA kitty?

The maintenance reserves will be important; there will hopefully be approximately one third of the gross annual fees charged to all residents in the reserves. A favorable minimum amount would be $4,000 per condo, although is manageable.

Another aspect that the HOA manages is the percentage of rental units allowable. Under 20% is passable, but any more and the re-sale of the condos becomes risky. Renters often do not have the same respect for property or neighbors, so they decrease desirability. Also, mortgage companies are aware of this and are reluctant to give out mortgages to high-rental complexes.

Once you have ironed out all these questions, you can consider whether you would like to get a professional inspection done. These inspections include the common areas as well as the condo you are interested in. Once all these precautions are in place, you will feel more secure to go ahead and make an offer.

To get expert advice, get in touch with our Housal expert today.