Essential Tips for First-Time Condo Buyers: Navigate Your Purchase
Do you feel confident and excited about getting your first condo investment? Do you want to make it as your primary residence soon as a First-Time Condo Buyers? It may be a huge milestone but at the same time, it can also be overwhelming. The good thing is you just need to strategize carefully and do your share of research so that you will be able to successfully navigate this thrilling journey.
Below are some of the essential tips for first-time buyers of condos who want to ensure a smooth purchase experience for their first residential property.
1. Set a Budget
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Similar to before you start shopping, first-time buyers of condominium units need to clearly define the budget that they can allot in this huge endeavor.
Determine Your Down Payment
Every condo developer or mortgage lender has required payment terms and conditions. It is crucial for a first-time buyer to know the minimum down payment required as it may be a huge sum of cash out.
Compute the Monthly Fees
Aside from the one-time down payment, there will be recurring costs pertaining to your purchased condo. These include mortgage payments, private mortgage insurance, property taxes, homeowners association or HOA fees, and the possible costs of maintaining your condo unity.
Check if You Can Really Afford to Buy a Condo with Your Financial Siuation
Double-check your current financial situation, including your savings, income, debts (if any), and regular monthly expenses. This way, you will be able to clearly identify what amount is within your budget.
2. Do Your Research and Understand the Condo Market
Apart from your budget, it is also critical to check on the market trends and the suitable location where you prefer to buy a condo.
Identify the Location You Want
Is your lifestyle fit for one of those rural areas with a more serene vibe or do you prefer to have a real estate property in the bustling cities where urban development is usually located? Factor in important aspects of your lifestyle, such as work, school, and leisure, or amenities like fitness centers, clubs, swimming pools, courts, and more.
Analyze Trends in Real Estate
Know the current housing trends so that you may be able to make more informed decisions. For instance, check the property values and taxes on specific locations where you want to buy a condo. Check the prevailing interest rates and the other factors being considered by first-time condo buyers. Additionally, if you are looking into making your condo a form of passive income, it will also help to know the prevailing rental rates in the area so you will know how long it will take you to get back your ROI.
Consult a Real Estate Agent
In the real estate market, the help of a knowledgeable agent might provide you with insights on how to best approach your decision to buy you first condo, and he may also provide you with the best options suitable for your budget and preferences.
3. Get Approval from Mortgage Lenders
After identifying your target condo property, the next step is to get an approval from a legitimate mortgage lender.
Research Different Mortgage Lenders
It is important to have a variety of options first before finally deciding where you will get the loan to buy your first condo. There are also different types of loans from these lenders, such as government-backed loans, first-time homebuyer loans, low down payment loans, fixed-rate mortgage loans, and other conventional loans. Some lenders even have closing cost assistance available. You should also consider availing the loan from a mortgage lender with the most competitive interest rates.
Prepare the Documentary Requirements
The first thing that a loan officer will ask you is if you have the required documents to apply for a mortgage loan. It will be helpful to research in advance what are these documents, but they typically include financial documents such as Certificate of Income Tax Returns and your bank statements, plus proof of identification, such as government-issued IDs, and income, like payslips of Certificate of Employment with stated salary.
Review if You Have a Healthy Credit Score
In your previous purchases or subscriptions, have you been paying on time? While there are no strict minimum credit score requirements in the Philippines in terms of availing home loan financing options, a good credit score can still help you secure an approved loan with more competitive interest rates, thus, enabling you to smoothly purchase your dream home.
4. Inspect the Condo Carefully
Before signing any purchase agreement, it must always be the case that you were able to thoroughly check the condo property.
Get the Help of Professionals
There are licensed engineers or technical professionals who may be able to help you inspect the premises of the property you are about to buy. Do not rely on yourself too much, especially if you have no expertise on this matter. These professionals will be able to identify potential issues, such as structural concerns, plumbing problems, electrical issues, and so on. Getting their services will save you the costs of having to do repairs in the future.
If you are to buy a unit previously owned by another individual, or just a fully furnished one, make sure to also check possible signs of wear and tear in the floorings, appliances, and paintings.
Know the Condo Association Policies
Every condominium building has its own homeowners association. Thus, it will be helpful to stay informed of their current regulations, most especially on fees, restrictions, and maintenance guidelines.
5. Agree on the Purchase Price
Once the condo unit is okay with you, it is now the time to talk about the total contract value of the property.
Know the Prices of Similar Properties
Your target condo may have its unique features but at the end of the day, there are still other comparable properties that you may use as a benchmark for the prices. This will help you decide if the purchase price being offered to you if within the fair market value.
Negotiate the Contract Price and Include Contingencies
It is your property so you should never be scared of negotiating the price and terms of the contract. Most developers have standard terms but it is always best to try to discuss and find a compromise, especially since this will be a huge investment and you need to protect your own interest as the buyer.
6. Understand the Process Until Its Closing
Your condo investment does not end by the time you are done paying your mortgage fees after a set period. There are still closing processes that need to be settled for you to finally get the propriety rights to your condo.
Check the Closing Terms in the Contract
Thoroughly scrutinize the provisions of closing the contract, such as the final closing costs, property taxes, and payments for the real estate attorney. Likewise, be clear on who should be responsible of processing all these needed documents for the final turnover of the property to your name.
Prepare an Ad Hoc Budget for Processing the Closing of Your Contract
Just to be sure you will be covered, it is always best to have a contingency fund to cover the costs of arranging the title of the property, and other pertinent documentary requirements. The safest way is to consult with a real estate attorney so you will be able to identify how much you need to prepare for this.
Key Takeaways
As a serious buyer, it is critical to understand the homebuying process from start to finish. Defining a clear budget, doing a whole bunch of research, securing the best financing option, making a thorough inspection of the property, negotiating wisely, and understanding the final closing steps will enable you to successfully make an informed decision.
If you want to start knowing about some of the best condos in the country, you may check out Vista Land’s website.
For more information on Vista Land’s developments nationwide, visit