20s: The best age range to invest in a condo, house
Owning a property — a house or condominium unit — in your 20s may seem “too early” as an investment option as most individuals in this age group are into buying the latest gadgets or traveling abroad with friends.
But real estate practitioners and financial planners in Cebu said individuals in their 20s are in the best position to purchase a house or condominium unit noting the availability of real estate projects which suit their financial capabilities.
Philippine Association of Real Estate Boards Inc. (Pareb) National Chairman Samuel Lao said young professionals with a salary ranging from P15,000 to P20,000 can afford an economic condominium unit which costs between P1.2 to P1.6 million.
Those who prefer a house and lot can check horizontal developments in cities such as Carcar and towns such as Compostela and Liloan, where they can pay between P5,000 to P7,000 in monthly amortization.
“Developers are required to have 20 percent of their projects to have a socialized component so young professionals can look into these projects and see if they want to invest in that project,” he told Cebu Daily News in a phone interview.
Lao said Cebu Landmasters Inc. and Johndorf Ventures Corp. have developments which are budget-friendly for those with a monthly salary range of P15,000 to P20,000.
He said the Home Development Mutual Fund, or more popularly known as Pag-IBIG, now allows loan applications from combined income sources of spouses, parents and siblings.
“Those with combined income of P30,000 can have a monthly amortization of P12,000 so it is really possible to buy a property,” he said.
Mae Godino, vice president for marketing and sales of Filipino Homes-Mandaue Branch, said “purchasing a condominium or any property in your early 20s is a major decision that requires commitment” especially when there are several temptations to spend money on travels, dining in restaurants and parties.
“To be able to afford a condominium or property in your early 20s, it is important to have enough savings to pay for the reservation fee and monthly equity. Keeping a good credit score is equally important so you can easily avail of housing loan,” she said.
Glenda Antonio, president and chief executive officer of Spring Rain Global, said future investors should maximize pre-selling opportunities of developers.
Spring Rain Global is a consultancy firm specializing in financial planning and philanthropy.
“The scheme of developers in maximizing the buying power of money through flexible offers to accommodate the capacity of young professionals to afford it is, indeed, very helpful,” said Antonio.
Antonio said owning a property is every Filipino’s dream but realizing that dream is hampered by a huge financial requirement.
“But with the opportunity to buy at a lower cost during the pre-selling period, young professionals have the pathway to own a property,” she said.
Lao said most young professionals are still single and are not yet burdened with other expenses.
The unmarried ones are not yet faced with additional expenses in spending for the necessities of a child and a spouse.
“The 20s is the best time to invest. I also think that those with an eight-hour job can get a sideline job so they can have additional income which they can use in other important expenses,” he said.
Godino of Filipino Homes agrees, adding that having a second or part-time job will allow the individual to earn extra cash, which can be used in paying for the monthly equity if acquiring a condo unit on pre-selling period.
She said they can also pay for the unit in cash to earn a discount.
“The discount can be used to furnish your unit in the future,” she said.
She said a condominium unit in the city typically costs between P1.6 million to P2 million.
The reservation fee ranges from P15,000 to P20,000.
Typically, a P2-million condominium unit, has a monthly equity which ranges from P8,000 to P14,000 and payment is spread out within 36 months to 42 months.
Lao said the “20-somethings have to be clear about their needs and wants.”
“Your wants, such as cellphones and travels, can be deferred. As long as they have full-time, regular jobs, they can start thinking long term and owning a home is part of a long-term plan,” he said.
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