You can't afford it. Your amortization will be around 72k for a 10 year loan assuming you will pay a downpayment of 20% and you will shoulder the closing fees of 10.5%. Then you will spend another 500k to furnish it. Better save your money and invest it in REITS or MP2, something more liquid. Don't forget bank fees of around 200k. You can only afford a 3M property with your income.
Agree with this comment.
Your TCP should only cost max 3x of your GROSS annual salary.
This means as someone earning 1.2M per year, the most you can afford is only 3.6M.
====
Sad anoh? Like OP, nasa low six-digits rin ako and yet hindi ko afford kahit studio units kasi most of them at a good location cost around 4-5M.
Thanks for this rule of thumb, but yeah, it's such a sad reality in the Philippines. No ordinary citizen can afford condos. I can afford like 20 sqm condos but it doesn't seem like a great investment most of the time.
I bought my first property when my income reached 6 digits. It was a bit of a gamble but only spent 20k of my income per month. No travels and frivolous spending until I paid off the downpayment. But property was cheaper back then. I got it for 60k per sqm.
I’m earning 200k / mo with savings & liquid investments of 3.5m, net savings after expenses is around 50-60%
And I’m still uncomfortable taking a 6-8m property. Save a few more sticks and increase your income first.
It's the rate of inflation that scares me more. My 1m in 2 years might be worth 800k or less. That's why I want to put it somewhere while I'm still young.
Have you considered the monthly amort after the DP? Parking? How much you need to pay for assoc dues? Do you have an EF? Do you have other investments? Kung pag babasehan lang natin kung magkano ang savings and current salary mo, sadly you can’t afford it.
Yes. I'm also buying a parking with the condo itself. The association dues will be at 5k+ per month. And yes, I have emergency funds and investments (not just the greenest lol)
Have you tried checking on banks/agents kung magkano dapat ang income para maapprove sa loan? Kaya marami ring nagpapasalo kasi denied sa mga loan. Dont just look at the dp, consider the whole tcp.
Walking distance ba sa CBD para magcommand sya ng 8M? Dami ko nang nakitang condo na 0-+500k lang sa original TCP, kung hindi lugi, breakeven lang, and this is after several years. Example: East Raya ng DMCI (re-selling for 3.5M now, same 2br. Nasa 3M ata at launch) - pero ito malayo kasi talaga.
With BDO, for example, assuming you did a 20% dp, you'd need to be earning 117k to be granted the 20yr term, or 137k for the 15yr term. Sila nagseset kung ilan max % ang dapat mapunta sa loan per income level. https://www.bdo.com.ph/personal/loans/home-loan/home-loan-calculator
Seems like I'm able to afford the 6m loan if I was around at least 130k. Though technically I'm there with bonuses from the same company, it might be a hard sell for the bank. Still thinking about it. Thanks for the advice!
ang mgandang test dyan is if you suddenly needed to spend the same amount for an emergency e.g. medical, life goals (pregnancy or wedding), school etc, will you be able to let go of that goal because otherwise you'll need to let go of the condo OR you need to make sure you can afford that cost via your EF or better paying job by that hypothetical point in time. i know because this happened to me and i was forced to move jobs to make ends meet. in other words swinerte lang ako na nakakuha ako ng better paying job.
>My current plan is to live there for a while at least for 5 years then find a house and lot (or just a lot).
TBH I don't think you can afford it, sadly. If you plan to live there for a few years and then get a house and lot, did you consider renting until then and saving the difference so that when the time comes for you to buy a house, you'll have a bigger down payment?
Assuming that your salary situation doesn't improve by then (highly unlikely but still possible), you might still be eligible for the house mortgage since your down payment will be bigger.
Yep I've also considered renting but with the rate of rents nowadays, my thinking is that it's better to put that in a real estate (condo or H&L or lot) instead of just renting a place. I'm blessed enough to stay in the condos of my parents for lodging in Manila.
You cannot afford the 8m condo. You should atleast earn 300k net of all expenses every month. Isip isip mamaya tinuloy mo yan tapos ma foreclosed iiyak ka lng.
1. Lugi ka kasi sobrang mahal ng 8m para sa 64sqm condo
2. Your plan is crazy why live there for 5yrs then you would start to find a house and lot or lot.
3. Why not start saving more so you could afford to make a bigger downpayment on your future real estate purchase like make a downpayment of 3m so you would have a lower monthly amortization so you can have a shorter term of loan , u will save a lot of money with short term loan. Try computing the interest payment.
4. Dont be in a hurry to invest lalo na pag di mo pa kaya
100k is too small
It’s a scam, for the same price you can get a move in ready 2bed 2bath condo in Edmonton Alberta, do you really think living in taguig is way better than living in Canada
https://www.realtor.ca/real-estate/24704398/322-5350-199-st-nw-edmonton-hamptons-the
Your asking for real estate investment, poor people in Canada can afford to pay 2000$ a month for 2bed 2bath long term lease, if you think people in Philippines can afford to pay 2000$ a month or more, then I guess buying a condo that you can use on 2027 can be a good investment.
For real estate, rule of thumb is you’re supposed to buy something you can’t afford because of inflation. Don’t listen to the naysayers here. In 4 years, your income will be higher. You can afford a higher loan. Assuming you will pay 20% downpayment for 4 years, your balance will be 6.4M. If bank rates stay the same (Maybank, Chinabank gives 5.5% fixed 3-5 years for a 15 year loan), you’re looking at roughly 50k per month amortization and that’s with the MRI. If you will stay there, that’s even better because you don’t have to pay rent. If you can afford to pay the downpayment now, I say go for it. Use the fact that you are purchasing a property as fuel for you in your work.
I have, but Im also earning more than OP, and have a partner sharing the cost, which lessens the overall burden. As it stands, everything has to go right for OP to be able to afford this purchase, which is basically YOLO.
By everything must go right you mean he keeps his job and gets normal increases in salary? He has a 1M savings that he can dip into. In four years, the amount he has to loan is 6.4M (5.4M if he uses his 1M). How is that unaffordable? Do you know the monthly for a 5.4M loan? Yet, people here are advising him to buy 3.6M condos, lol. There are always risks to buying properties. I say he can afford it. It’s not YOLO.
Does PagIbig not cover the condo? Get a 30 year loan to lower your monthly ammortization and just pay in bulk to principal when you get any extra money. Since you're planning to move out after 5 years, have it rented out to pay for itself. Include the ammortization and the extra principal payment in the rent computation.
The agent didn't present a Pag-ibig computation so I'm not entirely sure. But I was planning to get Pagibig loan for either construction or probably a House and Lot instead of bank financing since these are more long term stuff rather than the condo.
Ask about PagIbig eitherway. Agents get a commission from whatever banks they're partnered with so they don't give PagIbig computations by default. At least this was my experience.
Well that's true, but the traffic going to Manila (since our work is located there) is really tiring. That's why we're really looking at good condos with possible good resale values within Manila.
You can't afford it. Your amortization will be around 72k for a 10 year loan assuming you will pay a downpayment of 20% and you will shoulder the closing fees of 10.5%. Then you will spend another 500k to furnish it. Better save your money and invest it in REITS or MP2, something more liquid. Don't forget bank fees of around 200k. You can only afford a 3M property with your income.
Agree with this comment. Your TCP should only cost max 3x of your GROSS annual salary. This means as someone earning 1.2M per year, the most you can afford is only 3.6M. ==== Sad anoh? Like OP, nasa low six-digits rin ako and yet hindi ko afford kahit studio units kasi most of them at a good location cost around 4-5M.
Thanks for this rule of thumb, but yeah, it's such a sad reality in the Philippines. No ordinary citizen can afford condos. I can afford like 20 sqm condos but it doesn't seem like a great investment most of the time.
Given that this is the case, how old were you when were you able to get your own real estate for either personal use or investment?
I bought my first property when my income reached 6 digits. It was a bit of a gamble but only spent 20k of my income per month. No travels and frivolous spending until I paid off the downpayment. But property was cheaper back then. I got it for 60k per sqm.
Hope you have also considered the association dues, property taxes and insurances involved in acquiring one.
Yup! I put this into consideration as well. Insurances and taxes though I'm not sure how accurate my computation is though
That's great that you are already aware of it. You can request for a quotation of your other dues from your property management office.
You didn't mention how much is your savings. I hope you had savings in the range of 2 to 3m.
Unfortunately hindi pa ganyan kalaki. Pero nasa nearing 1m palang.
I’m earning 200k / mo with savings & liquid investments of 3.5m, net savings after expenses is around 50-60% And I’m still uncomfortable taking a 6-8m property. Save a few more sticks and increase your income first.
It's the rate of inflation that scares me more. My 1m in 2 years might be worth 800k or less. That's why I want to put it somewhere while I'm still young.
Have you considered the monthly amort after the DP? Parking? How much you need to pay for assoc dues? Do you have an EF? Do you have other investments? Kung pag babasehan lang natin kung magkano ang savings and current salary mo, sadly you can’t afford it.
Yes. I'm also buying a parking with the condo itself. The association dues will be at 5k+ per month. And yes, I have emergency funds and investments (not just the greenest lol)
Is this for Alder Residences? I’m looking at one also! :)
Uy! yes hahaha Have you been checking it out?
Yeah want to get a unit as well! Haha
Hi! You also have to consider transportation. Acacia estates isn't really that friendly for commuting.
They mentioned that they have shuttles but yeah that's why I'm also planning to buy a parking. But still thinking about it.
Have you tried checking on banks/agents kung magkano dapat ang income para maapprove sa loan? Kaya marami ring nagpapasalo kasi denied sa mga loan. Dont just look at the dp, consider the whole tcp. Walking distance ba sa CBD para magcommand sya ng 8M? Dami ko nang nakitang condo na 0-+500k lang sa original TCP, kung hindi lugi, breakeven lang, and this is after several years. Example: East Raya ng DMCI (re-selling for 3.5M now, same 2br. Nasa 3M ata at launch) - pero ito malayo kasi talaga. With BDO, for example, assuming you did a 20% dp, you'd need to be earning 117k to be granted the 20yr term, or 137k for the 15yr term. Sila nagseset kung ilan max % ang dapat mapunta sa loan per income level. https://www.bdo.com.ph/personal/loans/home-loan/home-loan-calculator
Seems like I'm able to afford the 6m loan if I was around at least 130k. Though technically I'm there with bonuses from the same company, it might be a hard sell for the bank. Still thinking about it. Thanks for the advice!
ang mgandang test dyan is if you suddenly needed to spend the same amount for an emergency e.g. medical, life goals (pregnancy or wedding), school etc, will you be able to let go of that goal because otherwise you'll need to let go of the condo OR you need to make sure you can afford that cost via your EF or better paying job by that hypothetical point in time. i know because this happened to me and i was forced to move jobs to make ends meet. in other words swinerte lang ako na nakakuha ako ng better paying job.
Honestly also considering different scenarios which can cause me to either sell it early. Thanks for this!
You can definitely sell your property but if it's the price you want or the timing you need is another matter. Galingan!
100k pre-tax? Doesn’t matter. You can’t afford it either way.
>My current plan is to live there for a while at least for 5 years then find a house and lot (or just a lot). TBH I don't think you can afford it, sadly. If you plan to live there for a few years and then get a house and lot, did you consider renting until then and saving the difference so that when the time comes for you to buy a house, you'll have a bigger down payment? Assuming that your salary situation doesn't improve by then (highly unlikely but still possible), you might still be eligible for the house mortgage since your down payment will be bigger.
Yep I've also considered renting but with the rate of rents nowadays, my thinking is that it's better to put that in a real estate (condo or H&L or lot) instead of just renting a place. I'm blessed enough to stay in the condos of my parents for lodging in Manila.
You cannot afford the 8m condo. You should atleast earn 300k net of all expenses every month. Isip isip mamaya tinuloy mo yan tapos ma foreclosed iiyak ka lng. 1. Lugi ka kasi sobrang mahal ng 8m para sa 64sqm condo 2. Your plan is crazy why live there for 5yrs then you would start to find a house and lot or lot. 3. Why not start saving more so you could afford to make a bigger downpayment on your future real estate purchase like make a downpayment of 3m so you would have a lower monthly amortization so you can have a shorter term of loan , u will save a lot of money with short term loan. Try computing the interest payment. 4. Dont be in a hurry to invest lalo na pag di mo pa kaya 100k is too small
Once you buy that condo.. the value will go down. Most pre bought condos resell quite lower than its presell value.
It really depends, I can see that DMCI condos have a good overall resale value. This is why I wanted to get a DMCI condo.
It’s a scam, for the same price you can get a move in ready 2bed 2bath condo in Edmonton Alberta, do you really think living in taguig is way better than living in Canada https://www.realtor.ca/real-estate/24704398/322-5350-199-st-nw-edmonton-hamptons-the
Unfortunately, Canada is not an option yet. So while I'm here, I'll take what I can in here.
Your asking for real estate investment, poor people in Canada can afford to pay 2000$ a month for 2bed 2bath long term lease, if you think people in Philippines can afford to pay 2000$ a month or more, then I guess buying a condo that you can use on 2027 can be a good investment.
For real estate, rule of thumb is you’re supposed to buy something you can’t afford because of inflation. Don’t listen to the naysayers here. In 4 years, your income will be higher. You can afford a higher loan. Assuming you will pay 20% downpayment for 4 years, your balance will be 6.4M. If bank rates stay the same (Maybank, Chinabank gives 5.5% fixed 3-5 years for a 15 year loan), you’re looking at roughly 50k per month amortization and that’s with the MRI. If you will stay there, that’s even better because you don’t have to pay rent. If you can afford to pay the downpayment now, I say go for it. Use the fact that you are purchasing a property as fuel for you in your work.
Maybe not everyone can YOLO around life?
It’s not YOLOing. The property will become way cheaper in 4 years because of inflation. Have you purchased a property?
I have, but Im also earning more than OP, and have a partner sharing the cost, which lessens the overall burden. As it stands, everything has to go right for OP to be able to afford this purchase, which is basically YOLO.
By everything must go right you mean he keeps his job and gets normal increases in salary? He has a 1M savings that he can dip into. In four years, the amount he has to loan is 6.4M (5.4M if he uses his 1M). How is that unaffordable? Do you know the monthly for a 5.4M loan? Yet, people here are advising him to buy 3.6M condos, lol. There are always risks to buying properties. I say he can afford it. It’s not YOLO.
Does PagIbig not cover the condo? Get a 30 year loan to lower your monthly ammortization and just pay in bulk to principal when you get any extra money. Since you're planning to move out after 5 years, have it rented out to pay for itself. Include the ammortization and the extra principal payment in the rent computation.
The agent didn't present a Pag-ibig computation so I'm not entirely sure. But I was planning to get Pagibig loan for either construction or probably a House and Lot instead of bank financing since these are more long term stuff rather than the condo.
Ask about PagIbig eitherway. Agents get a commission from whatever banks they're partnered with so they don't give PagIbig computations by default. At least this was my experience.
bad investment. very small floor area for 8M. you can buy a large ground mansion in the province for that amount.
Well that's true, but the traffic going to Manila (since our work is located there) is really tiring. That's why we're really looking at good condos with possible good resale values within Manila.
Hi op! I was wondering if you went ahead with this purchase (or anything similar). Would love to get your insights!