• Guide to home buyers: 8 issues to consider

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    FOR most families, buying a home is likely to be the biggest purchase they will ever make. Even under the best circumstances it can be a time-consuming and frustrating experience, but if done correctly, can be rewarded with years of happiness and security.

    We tapped the expertise of property professionals from local real estate developers, brokers, online listing services, and financial and legal advisers to share their best advice to make the home buying experience, particularly for those looking for their first home, a successful one.

    Consider utility before style: “We always put our best foot forward with our model homes,” said one residential developer. “But it’s important for buyers to consider what their needs are before thinking about how their home may look.” Determining space requirements not just for now but in the future, and whether or not the family will actually be comfortable in the new home is critical. The best advice, according to the developer: Always ask to see an empty model, one that is finished but not furnished.

    Get to know the neighborhood: Many buyers overlook the fact that their purchase means not only a new home, but sometimes a completely new community. Virtually all developers will highlight the services and features of the area where their homes are located, such as shopping, schools, and medical facilities, but an agent for a developer with properties in Cavite pointed out, “It’s one thing to know that there is shopping and other conveniences nearby, but in order to know whether you’ll be happy using them, you should try them out first.” The agent also reminded buyers to check “little things that many people overlook at first, such as where to pay bills, and where is the nearest ATM.”

    Another suggestion made by several experts: To determine whether you will feel safe and comfortable in your new neighborhood, visit it at night. “It’s best to go at 8 or 9 pm, when most people are home, but still active,” a property consultant for the online listing service Lamudi recommended. “If the area feels comfortable, it’s probably the right area for you.”

    Study all the options: Several experts agreed that the home buyers will eventually be happy living in is almost never the first one they consider. “It depends a little bit on your priorities,” one developer explained. “If it’s more important to you to live in a certain area and you’re a little flexible when it comes to the type of house, then look at all the available houses in that area. On the other hand, if your requirements for a house are set but you have some flexibility where you might live, then look at as many houses that fit your needs as you can.”

    Always have your prospective new home inspected: As several sales agents admitted, this can sometimes be a contentious demand, as some sellers may be hesitant to accommodate a thorough inspection by a third-party professional, but it is a must. An experienced inspector can determine whether anything needs repaired or replaced before moving in, and what risks may need to be remedied.

    The only problem is that as of now, there are few professional home inspection services in the Philippines, and of course, the service does come at a cost. Banks or the Home Development Mutual Fund (Pag-IBIG) are good sources of information on home inspectors.

    Get a pre-approved loan: Getting a pre-approved loan helps establish a budget by informing you how much you can afford with a bank’s or other lender’s help, and will tell you what your monthly payments are likely to be. In almost all cases, the pre-approval will provide fairly specific guidelines as to what type, size, and even location of the houses it can apply to, which helps to focus the search. It also makes the process of obtaining the final loan much faster, as the credit approval process has already been done.

    Include ‘extras’ in the budget: “Almost every client I’ve had is surprised the first time they’re asked to pay homeowners’ association dues,” the Cavite-based agent said. “It’s not a big expense, but no matter if I remind them about it beforehand, no one thinks to include it in their budget.”

    Association dues or other fees, property taxes, funds for new renovating or new furnishings, higher utility rates due to a larger home, even extra expenses from a longer commute to work all add to one’s costs, but are easy to overlook. Doing some research and seeking the advice of experts can help you avoid being surprised by ‘hidden costs,’ and make your monthly living expenses in your new home much easier to manage.

    A loan officer with BDO suggested, “As a rule of thumb, if the customer hasn’t completely worked out their potential expenses, I advise them to look for houses priced at least 10 to 15 percent less than what they can afford with their down payment and pre-approved loan amount combined. That will make their final loan less, of course, but also lowers their down-payment, and frees up some money for those extra costs.”

    Put everything in writing, and read and understand every word of it: Never rely on a verbal agreement once you and the seller or agent have come to terms on something; include it in the sales contract. That makes each party’s responsibilities clear, and defines what is and is not included in the sale. And before signing the final contract, be sure to read and understand all its terms; seek the advice of an attorney to make sure there are no provisions that take away your rights, and if there are any parts that otherwise need to be changed.

    Above all, take your time: Buying a home is one the biggest decisions a family will ever make, and for most people means taking on a debt that might last for years, as well costing most or all of one’s savings. Taking the time to do thorough research, consider all the available alternatives, and seek the advice of experts will certainly pay off in the long run, by providing you with a property that your family can cherish for generations.

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