6 Reasons That Prevents First Timer From Buying Properties

One of the major financial decisions we consider the hardest in life is buying a property.  Most of my clients in my recent US trip who came close into buying a property  changed their minds the last minute prior to signing the reservation documents. It  takes a lot of guts and responsibilities in the process of buying a property in the Philippines from abroad.  Listed down below are 6 of the main  reasons why they cannot decide on buying a property abroad.

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  1. The fear of not knowing anything about buying a property in the Philippines – There’s a big difference in buying a house in the U.S. and buying in  the Philippines. Based from my  survey, it is easier to buy real estate in the U.S.  First thing is the availability of MLS or Multiple Listing Service nationwide. The prospective buyer can scan through the MLS, chooses a property, and makes an offer to the seller right away. Once the seller decided to get the unit and accepts, they open the escrow for the protection of both parties,transfer of funds or payments can be made and transfer of title can be done in a number of weeks. While buying properties in the Philippines is not that easy. First, the logistic side of sending documents via Fedex and payments via remittances would be difficult for US based Filipinos who work longer hours than our local counterparts thus having a little time to do the extra errands. Next  is the extra paper works needed by our kababayans based in the US such as the SPA (Special Power of Attorney), for consularization in the Philippine Consulate, and finally the concerns regarding the transfer of payments of their chosen properties.  We need to do a lot of researching to find a solution to this problem. You can inquire from your friends in the Philippines on the current market conditions, fees of local banks,etc.  Inquire also your local remittance company on how to make payments to the particular developer. Ask your friends who are in the industry; banks,friends who have just purchased new properties and  lawyers based in the Philippines  to check on the contracts that you need to sign.

2. The fear of not being able to put a deal up altogether. If you know how to budget your daily, weekly, or monthly expenses then you can plan your purchase. There are properties that are ready for occupancy and construction of some are still ongoing and will be ready within 2 to 3 years time. With the different options in payment schemes, you can easily plan your alloted timeframes and one that would suit your goals. Some buyers are worried about paying the final balloon payment.  The buyer just needs to apply for a loan and have it ready once final payments should be asked. They just need to submit some financial documents to asses their capabilities in paying their loans.

3. The fear of not being able to come up with the downpayment. Previously, the easiest terms of payment by a developer is a 30% downpayment on the spot and  a 70% thru in house financing  interest free for  3 years. Presently, there are easy no downpayment terms that would allow a buyer to pay at least $180 to $290 dollars a month for the equity, and have it financed through a local bank once  ready for occupancy. This is just a matter of setting your priorities. Maybe, you can postpone some other expenses like luxurious vacations, buying signature bags and shoes or even buying a brand new car. You will realized that in 2 years time, you made a right decision of making buying properties your priority. Enjoying the convenience of having your home with your family. There is a saying that patience is a virtue.

4. The fear of not being able to pay the monthly amortization on time. You already make monthly payments right now. The utilities and bills, monthly rent, credit cards, etc. There is no reason to assume that you delay the payments on the property that you purchased. The best thing to do is to manage your budget every month and know the monthly fees associated your properties. Philippine property is not exempted from HOA or Homeowners Associations Fees, cleaning fees or garbage fees, the yearly real estate property taxes, and other miscellaneous fees. It’s just a matter of managing your finances.

5. The fear of buying a property at a wrong time. There is no wrong timing to buying real estate. Real Estate gains would be realized in the long term. The best time to buy a property is in the buyers market. A buyers market is a situation wherein interest rates are high, banks are strict in giving out loans, and the developer  is  having a hard time on moving the inventory. At this time, the developers offer a big discounts that could stretch from 15 to 20% and could take on creative financing offers just to get the sale. Now is a sellers market, the developers enjoy the quarterly gains posted in the price increases being realized for the past quarters. With the rise in competition with the different developements, they now offer easy financing terms with no interest. You just need to be very careful in choosing and do some research based on your  needs. The development of the location will dictate if it’s going to be a good buy and will gain profit in the future.

6. The fear of neglecting family commitments.  You may think that you cannot buy a property in the Philippines because:

A. You’re Single and Alone.

B. You’re not yet annulled  of your marriage.

C. You’re married and living with a spouse.

D. You have children to care for.

All of these are just excuses. If you are single, this is a good time to take on a new responsibility. With the payment terms that could stretch from 10 up to 60 months, you can plan from year 1 to year 5 depending on your target goals. If you are worried about your current status with your spouse and is not yet annulled, I advise my clients to have it under the name of their children or they can create a Philippine Corporation and name it under it to make it safer.   Name. Letters C and D would be solved by planning the expenses as a new chapter in your life. This could also be a good motivation to pay off your home mortgage.


If you fear that you cannot do it alone, give us a call and we are more than willing to help.


Paolo V. Flores


Office No. 956-3284

Mobile No. (0915)567-7656

US Line: 001 562 443 8556



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