Lumina Sessions: How to buy your own house and lot?

Hello everyone! It’s another Good Lumina morning for us here in Lumina Sessions.

Are you considering to buy your first real estate property and don’t have any idea where or how to start? Don’t worry we got you!

For today’s Lumina Sessions, we will join Lara, the Lumina Marketing staff from Lumina Tarlac to tackle about the various things you need to consider before starting a real estate investment.

Thing you need to consider before buying a real estate property here in the Philippines

We all know that buying a real estate property is a major decision in one’s life, especially if it is your lifelong dream and you’ve been working hard to earn it for many years. That is why it is a purchase that you need to consider not just once or twice, but thrice!

1. Know your purpose

Before you buy a property, you must ask yourself first, why do I need to buy it? It could be for personal use or for investment purposes.

Another factor that you need to consider is the type and the kind of property you are planning to invest. Would you like to buy a house and lot? If yes, is it a single detached model unit duplex, or a townhouse?

In addition to this, you must also decide if you would like to purchase a pre-selling property or a ready for occupancy property.

2. Pre-qualification

You need to pre-qualify yourself first before buying a real estate property. Pre-qualifying means you need to assess how much your budget is for the property that you are going to purchase. This will help you to determine if it is already the right time for you to start investing in a property or if you need to save more money for it.

Aside from this, it is also important for you to prepare the necessary documents for a home loan. This will help you to save time as some of them take time in processing such as CEC or bank statements and these vary depending on your preferred financial scheme. Preparing them will allow you to have an easier home loan transaction.

3. Basic real estate knowledge

If you are a first time homebuyer and you don’t really have any idea about real estate, we are inviting you to watch our previous Lumina Sessions videos about some common real estate terms, facts, documents, and more to familiarize yourself about the property acquisition.

Being equipped with this knowledge can help you to inquire and get the right information about the property you are eyeing to buy.

4. Net income

Your net income depends on the loanable amount that you can get based on your pre-qualification.

When buying a real estate property, you need to at least have a comfortable net income. This is because a larger income than your monthly amortization based on your loanable amount will help you to verify if you can really buy a property.

Also, this can save you in a long run—avoiding your property to be foreclosed by the bank.

5. Savings

Apart from having a comfortable net income, you must also have savings. You need to have savings because there are some properties in which you need to pay downpayment beforehand. You might also need to settle some monthly fees including monthly amortization, homeowner fees, and real estate tax.

On top of that, you might need to have some extra money for home improvements if the property you are going to buy needs some construction or renovation. In this situation, you would need to have some funds for furniture, appliances, and emergencies.

6. Good credit

You must take note that having a good credit is essential when you want to purchase a property. It is important because this will prove that you are a good payer and can guarantee a good chance to have a faster loan approval since they can tell that you are always paying your bills on time.

After you pre-qualify yourself, know the type of property that you would like to purchase, have an idea about real estate basics, computer your net income, have enough savings as well as  a good credit score, then next would be one of the most important thing.

7. Location

In real estate, location is one of the most important things to consider when investing.  One of the factors that you need to consider when choosing a location for your property is accessibility.

Is the property you’re eyeing to buy is accessible enough? Is it near some of the major establishments and facilities such as malls, hospitals, or churches? Is it near your work? Is it near the school of your kids? Is there a transportation hub nearby that property?

Or is it near on your way of life? Like for example, if you love shopping, then it’s much better if you are near shopping malls or grocery stores so that your property can also fit your lifestyle.

8. Supply and demand

This will give you an idea what will be the ideal prices of the property in the location where you want to purchase a real estate.

Remember, the lower the demand, the lower the price. The higher the demand, the higher the price. If the supply is higher than the demand, usually the value of the property is lower compared to other locations that have a higher demand.

Just like the properties located in the provinces or suburbs. Usually, the prices of properties in these locations are much lower than in the metro since there are still lot properties there that are not for sale. Also, fewer people buy properties outside the Metro Manila so the demand is also lower, unlike in Metro Manila in which the supply of properties is lesser than the demand.

This kind of scenario usually results for investors and homebuyers to scramble over the properties in Metro Manila that makes its value much higher than in the province or suburbs.

9. Viewing

Once that you are already sure about the location of your property, the next thing that you need to consider is the property itself. In this case, you can book for a site viewing or site tripping to see the actual property that you want to buy. Below are the things that you need to consider while having your site tripping:

• Size of the property: This includes the lot area and floor area, and the length and the height of the rooms to know if the spacing is okay for you. Take note that you have to think long term for the rooms and spaces. You must consider where to place your kitchen or how many rooms you want to have in your property.

Please also take note the parts that you may like to renovate so that you could already have an idea how much it will cost you.

• Materials used in the property: For this, you have to familiarize yourself about the different materials being used for the property. Make sure that they are durable enough.
• Home features: Consider the different parts of the house. Does it have a kitchen, dining area, living area, a garage or carport? Again, in this case, you have to think long term about your needs and want for the property.
• Ventilation: Are there enough windows or is there an airway? Is there enough air coming through the property or is it too humid?
• Price of the property
• Terms and Conditions
• Financing options or schemes

10. Due diligence

Once that you are already a hundred percent sure about the property that you are eyeing for and were already able to inspect it, you need to have due diligence about the property or developer.

In order to this, you need to do a background check about the specific property and developer as well. You can consult a real estate broker o a lawyer to know more about the property and the developer if it has a clean title so that you will not have a problem in the long run.

11. Documents

You need to get the proper documents in order to transfer the title. For this, you need to have the following documents:

• Deed of Sale
• Contract to Sell the property
• Memorandum of Agreement if needed for the real estate broker
• Intent to Buy once you’re already sure to buy the property
• Floor Plans

And that’s it! We hope that we were able to cover some of the important details for our first time homebuyers and we’re looking forward for you to be part of our Lumina Homes community.