Precisely what Investors Ought to Know About Purchasing Low-Cost Housing in Filipino Real Estate
NO EQUITY! RIGHT NOW DOWN PAYMENT! JUST PAY two, 900 PER MONTH THRU PAG-IBIG. OWN A HOUSE NOW!!!
From the viewpoint of the lower-income families, why not? Specifically, if you like the location, why not buy a house that you will own ultimately than keep on renting throughout your life where you won’t personal anything. But from the point of view of investors who think about buying several units and still have these units rented and ultimately own all these units, could it be a good idea? What creates me to write this article ended up being my client who signified intention to reserve some units in a row when it comes to availing her application for three million loans with Pag-big Fund. I presented her 7 points of consideration before you make the decision to invest:
1) PAG-BIG LIMITS ONLY ONE UNIT INVOLVING HOUSE AND LOT FOR EVERY SINGLE MEMBER
With this ruling, merely one unit can be financed by way of Pag-big and the other a few in the row will be by way of bank financing? It will be some sort of loss on the investor since other people are getting the house for jus about 6% interest rate through Pag-big and as we know financial institution financing is about 10% rate of interest, and besides, this advancement is not bankable yet simply because for now, it is just even organic land. It is only through Pag-big because the developer has earlier arrangements with Pag-big utilizing the entire property as security with Pag-big.
2) PAG-BIG NO LONGER ALLOWS ASSUMPTIONS ASSOCIATED WITH MORTGAGES
Because of rampant also are sales through assumptions involving mortgage, Pag-big does not let anymore any assumptions involving mortgage if ever you want to will sell the property. That’s why we encounter the of selling low-cost residences whose owner still has harmony with Pag-big because of this taking over.
We had a situation wherein the owner sells her property through the contract but when the new user pays Pag-big, it will nevertheless be in the name of the outdated owner which carries on its own a certain amount of risk on the part of the modern owner. It’s also disadvantageous for the seller if the account should not be paid because she will have got a bad record with Pag-big and cannot be approved for virtually any loan in the future.
3) RA 7279 or the Urban Growth and Housing Act involving 1992 requires housing along with land
Set aside twenty per cent of their portfolio for low-cost and socialized housing. This kind of law requires all Real estate property developers in the Philippines to create low-cost and socialized real estate for at least 20% of their tasks for the masses. This means in case one developer plans to build up a high-end project in an exceedingly attractive location, such a programmer is required to build 20% from the project for low cost as well as socialized housing somewhere else.
This particular law means one thing in order to investors: That there will always be a sufficient supply of socialized housing (including low-cost housing) for the public. This is not ideal for the trader because of the assurance that there could be more supply of low-cost and socialized housing and that if ever your timeshare rented now, they can very easily abandon it and get a loan with Pag-big by themselves.
4) IT’S A FACT THAT THE MOST OVERDUE RENTERS ARE THE LOW CASH FLOW GROUP.
In this fact, you may surely encounter problems involving the inability to pay for the book. A vast majority of these people don’t have to check accounts so you cannot count on post-dated checks through nor for any comfortable sort of collecting payment such as cord transfer or bank for you to the bank. You really have to hit on their doors and accumulate the rent when it’s credited.
The spots of socialized and inexpensive housing are very far off the town or considerably far from colleges, commercial centres, markets, as well as Companies where low-cost breadwinners report for function. Some prospect buyers tend to be discouraged to invest in one device for their family because if a person computes the expenses upon transportation over the years, it would emerge to be more expensive than having the low-cost unit.
6) IF EVER YOU HAVE FULLY COMPENSATED THE HOUSE, IT WILL STILL BE TO BE ABLE TO SELL IT IN THE FUTURE IF YOU WANT TO THAT
Simply because for this type of marketplace, almost 100% do not have the money to pay. Even the OFW which are usually the domestic témoin and labourers, still could not pay in cash for the reason that prefers to avail themselves the in a different country Pag-big loan Program. Also, for this type of market, standard bank financing is seldom a method, it’s almost always Pag-big because the very low rate for as it is known to us Pag-big or HMDF is definitely pro-poor.
7) BUILDINGS ARE ORDERLY AT THE START ALTHOUGH TOPSY TURVY IN THE FUTURE
Is it doesn’t very nature of socialized and low-cost housing this at the start, it appears clean in addition to orderly (entire subdivision) although by experience, just a matter of two years, majority of the residents develop indiscriminately, some one-storey sections are expanded to secondly floor, while the attached next-door neighbour in a row remains one-storey unit.
Others build carports and fences while others generally do not. Others repaint their properties yellow while others are orange or perhaps white, and a lot of them merely display their hanged outfits right in front of their properties. Such a scenario which is quite typical will surely make the entire home depreciate in value.
End up being that as it may, I continue to believe it’s good to have socialized or low-priced housing far better than hiring for the rest of one’s life. Yet let this investment end up being confined to actual users and also developers of the property.
Virtually any investor who is not a person but decides to buy inside hope that rental salary can make him own houses will surely get into trouble together with the 7 problems mentioned above. If your investor thinks he can take care of these 7 problems, who all am I to stop him? My partner and I merely and gladly show my ideas based on precise experience and knowledge of real estate laws.