Owning a condominium is an investment that can provide a good income, property developer Megaworld said, suggesting four different options condo owners can explore to “monetize” their property.
“Real estate is a tested means of investment. A good number of people who choose to invest in real estate do so for this purpose. With great deals from property developers and flexible financing options from banks, owning a condo is easy,” said Megaworld’s Nicole Adarme.
“Earning from your condo unit sounds like pretty easy money, but one needs to determine which set up works best with his or her expectations,” she added.
Megaworld suggested a good short-term option, suitable for owners who eventually intend to live in their condo unit (such as OFWs who will retire back to the Philippines after working overseas), is to rent the unit on a short-term basis, for periods ranging from several days to several months.
“You can set flexible rates on a daily, weekly, or monthly basis. This set up is best if you still want to get a chance to use your unit every now and then. This scheme is quite demanding in terms of time and effort though, as you would need to evaluate each potential occupant and their activities, as well as need to do major cleaning in between bookings. On the upside, rates for short term deals are much higher than what a long term lease can give you so you can potentially earn double of what you would normally get compared to a regular annual lease,” Adarme explained.
Another option is a long-term lease, with a contract of at least one year. Rent can equal or slightly exceed the monthly housing loan amortization, while in the meantime, the property increases in value.
For owners who are not interested in the attention managing a lease requires, there are two ways to purchase a condominium unit and sell it at a profit in a relatively short period of time.
The first option is buy at the “pre-selling” price, and then sell the unit when the building is ready for occupancy.
“The cheapest deals are offered a few years before the anticipated turnover. If you can afford to spare some cash without the immediate expectation of returns, this may be a good option for you to earn from a condo unit,” Adarme said.
By the time the construction is done and the property is turned over, it can be sold to a buyer ready to move in. Adarme cautioned, however, that investors should only deal with reputable developers to avoid delays, lower value than anticipated, or even worse, a complete failure of the project resulting in no property to sell.
A second option is to “flip” the condo unit, which is possible because most units are delivered bare.
“One way to increase a unit’s asking price is by making smart improvements. As units are turned over bare, they stand to attract more buyers by providing extra perks such as installing extra shelves, dividers, and sprucing up the floors and walls,” Adarme said.
She added that if the owner has sufficient funds, including furniture and basic equipment is a great idea. “You’d be surprised how people are more willing to pay extra just to save them the trouble of canvassing and shopping,” Adarme said.
She added, “Aside from making it look nice, ensure that major systems of the unit such as the electrical and plumbing systems are in good shape. And of course, if all these are done in a tastefully clever manner, you can absolutely command a good price.”