Advantages of Real Estate Investing

Advantages of Real Estate Investing

The Philippines is at the threshold of rapid growth. Investor confidence and government stability in the last 5 years or so, together with the fact that it has one of the most advantageous real estate tax structures in the world, has made real estate investing very attractive to foreigners and residents alike. Here are the advantages of real estate investing in the Philippines today.

Buyer’s market

Despite the rising cost of property values, there is a construction boom in many parts of the Philippines. Developers are hotly pursuing potential buyers with attractive payment terms and discounts, especially for pre-selling projects. You can literally bargain your way to a better deal by simply making contact. Do not commit before you have had a chance to canvass similar properties, though, no matter how good the agent is at wooing you. You should also check out the reputation of the developer, especially if you are considering a condo. Don’t be content with looking at model houses. Visit finished projects of the developer to see how it is holding up, and get feedback from residents. You don’t want to get stuck with a property that will deteriorate before you even finish paying for it.

High demand for rental properties

Many people are choosing to rent instead of buying property because it is more practical. This is especially true for the young, single, fickle BPO labor force that move from one company to another. This is a population with relatively large disposable incomes with a preference for mobility. They are willing to pay a premium to rent a condo or apartment in the vicinity of their employment for convenience. If they change jobs and need to relocate, they can do that easily.   If you choose the location of your real estate investment wisely, you can expect good competition to rent your property

Passive income

The beauty of real estate investing is you don’t have to do much to make money. Once you find a good tenant that pays you regularly, you can sit back and wait for the monthly check to come in and pocket the difference after all your expenses are paid. Of course, finding a good tenant and maintaining the property requires some effort, but if you don’t have time or the inclination to do it yourself, you can retain a good property management company to do it for you. They will even take care and do a better job of maintaining the property, dealing with tenant issues, paying taxes, and collecting payments. Professional property managers typically charge you 10% of the monthly rent for the service, which is not bad at all. Just make sure that the company you hire has a good track record. Get recommendations from friends or family who also rent out property, or check online for feedback.

Ownership

Getting a loan makes sense when you buy real estate for investment. You can pass on a large portion if not the entirety of your mortgage payments and related expenses on your tenant. At the end of the day, even if you don’t actually make much money from renting out your property, you win anyway because own it. You can even claim tax deductions for the mortgage payments you don’t pay on your income tax return!

Real estate investing is not always a good way to put your money in, but it is in the Philippines. However, time is of the essence. Things can change, and not always for the better. Currently, real estate investments in the Philippines are hot. Good real estate investing is all about knowing when to strike.

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