5 Immutable Laws of Buying a Home

As the proliferation of real estate choices have become more apparent, we are subjected to a wide variety of different variables that can affect our buying decision. Especially in the Philippines where there are so many developers claiming to be the best and largest developer in the industry we become misinformed who truly can deliver and provide the best value for their money.

Our blog team here at DMCI Homes hopes to provide with what we call the “5 Immutable Laws of Buying a Home” to help buyers and homeowners determine whether they have made the right choice in finding a home for the best value for their money. The following laws are not in any specific order.

1.Price- For many, buying a home only happens once or twice in a lifetime. Considering this in mind, many spend a lot of time and effort in choosing the best investment for their hard earned money. Hence, the value-for-money is an important purchasing factor in buying a home. Be sure to ask the developer the available payment options; be aware of bank financing, in-house options, and cash payments. For those who do not qualify for bank loans, there are some developers who have tie-ups with private banks that are flexible on approving loans if the applicant has had a positive track record of payments for in-house financing. Understanding your available payment options will help you save money on interest rates alone. HSBC charges a fixed rate of 8.99% for a five year loan with a minimum loan amount of P2 million, while some developers charge 17% in fixed interest rates for a five year loan.

Reference- HSBC Personal Home Loans

2.Location- The majority of our homeowners that have purchased a home at DMCI Homes have stated that location is one of the top three factors in their purchasing decision. Accessibility to work, school, commercial business centers (CBD), and hospitals are all important factors to consider when purchasing a home.

3.Size- In our experience, homeowners–especially young growing families–are very conscious about the space they can move around, for their own personal utilization, as well as for their growing family.. It would be recommended to determine whether you are looking between hi-rise condominiums and medium-rise condominiums (MRB’s). Hi-rise condominiums consists of about 10 and more stories, while MRB’s consists of 10 stories or less. I have listed below the ideal composition for a High-rise and a Mid-rise development based on experience:

a.)Hi-rise condominiums, they are generally more location-centric. Many people opt for hi-rise condominiums as they are closer to the CBD and major thoroughfares allowing easy access to work, school, etc. Keep in mind that many developers typically allot 1,800 units/hectare and above for a typical 25-30 story condominium, while a favorable number of 1,100-1200 units/hectare for a typical 25-30 story. To get this data all you would need is to get the total number of units in the project divided by the total land area in hectares.

Formula for finding units per hectare:

Total units

—————————-   =  Units per hectare

Land Area (hectares)

b.)Medium-rise condominiums (MRB) attract homeowners who would consider living farther in exchange for a less dense community. Generally attracting starting families and young professionals. The density of MRB’s are generally between 400-450 units per hectare, while a favorable number of 250-280 units/hectare is ideal. Another key factor to look into is the amount of land area devoted to amenities and open space. 35-45% of the land area devoted specifically for amenities is ideal, most developers allot between  12-15% of land area to amenities.

P.S.-some developers include easements, roads, and other structures in their allotted land for amenities. Be sure to ask what the actual percent of land area is devoted specifically to amenities.

4.Quality- Nowadays quality has been a specification that many have begun to take into consideration more so than before, especially after the calamity that struck Japan. It is important to make sure that you have done your research on developers’ track records in respect to construction. In one developers’ project, which it is built very near the Marikina West Valley Fault line, construction is deemed important in regards to the precautions taken into construction of the project.

5.Developer credibility- Last but not least, developer credibility plays a considerable role in the purchasing experience. Investing a large amount of money in the wrong developer may cause problems later on. For example, one developer has been accused of using ‘fake borrowers’ to borrow loans from Pag-Ibig and from private banks, this is a controversy that should be avoided at all costs. Note: research the company you intend to invest and make sure you read reviews, track records, testimonials, news articles, and the likes. It is also better to know the corporation’s mission statement and values for peace of mind.

What about you? What are your top factors in choosing your home? Please post your comments and subscribe to our blog for more useful tips and advice.


About Alfonso's Page

With a wife and a baby on the way, the cost of living in the city became prohibitive for Alfonso. Far beyond the city boundaries, other builders began to develop sprawling neighborhoods of cookie-cutter houses on doily-sized lots. They’re pretty but too cramped (for a growing family) and too far out of the city center. Alfonso became a stressed out man-in-the-middle, faced with no choice but to take the long daily commute--or pay big city prices. There was no middle ground. “Pagod ka na papunta sa trabaho, pagod ka pa pag-uwi…” “Alfonso deserves better. He deserves a real home, accessible to his work… a cocoon of good living.” This page is DEDICATED to all the Alfonso's out there in the Philippines looking to find more information about investing in Real Estate in the Philippines.
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