Do’s and don’ts for first-time condo buyers
Here is an article that appeared in the Business Mirror which you will find informative in buying for first condominium unit specially that there are now several condo projects in Cagayan de Oro City and more is coming.
First-time condominium buyers, especially balikbayans or migrant workers, usually find themselves in a quandary when confronted with opportunities to purchase “vertical” property as opposed to the run-of-the-mill horizontal property, or a house and lot.
To help balikbayans and migrant workers in choosing the right condominium, Cynthia Palad-Yap, the owner and general manager of Real Estate Movers Inc., bares nine tips—which she readily shares with clients—on how to buy a condominium in the Philippines.
“When it comes to buying a condominium or any other real property, location is key. You should ask yourself, ‘Is it near major thoroughfares? Is the condo located in a quiet area and yet accessible to commercial areas, schools and hospitals?’” Palad-Yap says.
If the buyer is a balikbayan or migrant worker, the most important question may be, “How many minutes is the condominium from the airport,” she adds.
Palad-Yap, however, is partial to Fort Bonifacio, which she points out is “a very good location.”
“It’s only 30 minutes from the Ninoy Aquino International Airport and is practically close to major locations like Makati, Pasig, Mandaluyong, Quezon City, Manila, Antipolo, and Alabang. Fort Bonifacio is right in the middle of everything,” she says.
Every good condominium has a masterplan that details correct zoning and strict adherence to laws. Palad-Yap says she advocates not only the preparation of a good masterplan for any condominium building but also convincing buyers to take an active interest in the plan.
“A good masterplan incorporates several factors like zoning, floor area density, security and traffic management, designation of area for open spaces, parks and landscaping, and reliable utilities,” Palad-Yap shares.
She says one way to determine the “soundness” of the plan, buyers should try imagining in their mind’s eye how the place will look like five to 10 years from the time the condominium was bought.
Again, Palad-Yap tells buyers that Fort Bonifacio, or better known as Global City, has a good masterplan, pointing out that the sprawling former military camp is “world class.”
Reviewing the track record of the developer, builder, or project manager also plays a big part in determining what condominium a buyer should go for.
“Ask the developer whether the project was finished on time or delivered exactly as they promised,” Palad-Yap says.
Knowing when the condominiums were actually turned over to their respective owners is also very important, Palad-Yap shares.
“Why invest in a condo that will take forever to be turned over? Remember that the reason you, the buyer, is investing in a condominium is because you and your family are looking forward to using it immediately,” she says.
“The typical balikbayan will like to have a place of their own when they visit the Philippines, while other investors like to lease out their condos for rental income. The point is you are buying a condo because you like to get the benefits at a shorter waiting time,” she adds.
The model unit may look off the charts but remember that it is just that—a model. There are a lot more factors to consider than simply getting a superficial taste of the condominium by viewing brochures and other walkthroughs.
“Far from it,” Palad-Yap assures. “You should consider not only the aesthetics but also factors such as the number of units per floor of the building, the total number of floors, and the number of—functional—elevators or stairwells.”
“Simply put, the density of the building will determine the number of tenants. This will impact greatly on foot traffic, elevator waiting time, and privacy,” she adds.
An often-neglected factor in choosing a condominium is whether to buy a flat or a bi-level or loft unit. Why is it so important? Because it will determine the amount of living space.
A flat is the more common type of condominium where all bedrooms, the living room, dining room, and toilet and baths are located on a single level. A bi-level or loft, on the other hand, has a staircase that leads to a loft or second floor where the bedrooms—and sometimes a bathroom—are located.
“Selecting a flat unit versus a bi-level or loft unit is very subjective because it really depends on the tastes and preferences of the client. As a real estate broker, I’d like to point out several areas for consideration,” Palad-Yap says.
“The Philippines is a tropical country, and during summer it gets really hot, especially in a condominium unit. Most condos use glass for aesthetic purposes and loft-type units have large glass windows covering the entire length of the exterior wall, from floor to ceiling, meaning higher exposure to sunshine,” she adds.
Palad-Yap’s point is, loft or bi-level type condominiums get hot faster because of higher exposure to sunlight.
“Obviously, the loft-type units require more air-conditioning and, therefore, higher electricity costs. But if you still like to get a loft-type unit similar to the ones we see in Manhattan, New York City, then go for it but be prepared to invest in a good air-conditioning system,” she explains.
Palad-Yap says other factors to consider are small children and old persons who will co-inhabit the condominium. “A flat unit will be more appropriate if there are small children and elderly folk.”
Buy condos from property developers that have the appreciation of property values at the top of their minds, Palad-Yap says.
How do you determine this without baiting the property developer with sugarcoated words dripping with sarcasm?
“Good property management will be reflected through efficient maintenance and security of the condos common areas, like the lobby and hallways, efficient garbage collection, and proper maintenance of amenities like the swimming pool, gym, and function rooms,” Palad-Yap says.
In the same vein, Palad-Yap says, it is also important to know beforehand how much the association dues are. Generally, condominiums with more open spaces and amenities have higher dues.
When you purchase a condominium unit, there are other costs that should be considered, Palad-Yap points out.
“The projected condo or association dues, the value-added tax, and the closing costs that covers registration fees, transfer taxes, and documentary stamp taxes. Some developers require immediate payment while others give you a leeway of about a month,” she says.
There is also the matter of projected property taxes for the unit, Palad-Yap adds. “The actual property tax can only be determined when the condo is ready for occupancy. The city or town assessor’s office will make an actual assessment of the value of the property that will form the basis for the taxes. Property tax is usually 1.5 percent of the assessed value,” she says.
Palad-Yap says the most important factor to consider in buying a condominium is the reputation of the broker that is selling the unit.
“The licensed real estate broker is your link to the developer or builder. He or she can give you a thorough background of different condominium developments, emphasizing the condos strengths and weaknesses,” she says.
“A knowledgeable broker can assist you in coming up with a ‘shortlist’ of condos based on your needs and preferences. He or she can help with the sales and negotiation process, and provide you with good after-sales service.”