Property Buying Tips

When you are ready to buy the home of your dreams, you naturally want to make sure that everything is perfect. There's a hundred different things that need to be checked, and every one of them is important. Pinoy Realty understands your concerns. We suggest you to spend some time and ask yourself certain critical questions, before taking this important decision of your life.

We've compiled, for you, a comprehensive guide on things to keep in mind while buying a home. Whether you're able to make time for one two or three showings for a house, following the tips detailed here should ensure that you make the correct, informed choice. If this list is not enough, we also have a pool of real estate experts who will answer your queries. Ask the Pinoy Realty Experts   

What is your need?

Having decided that you need to buy a home, you need to check your exact requirement. Do you need one, two, three or more bedrooms unit? Remember you have to plan long term, as your needs will increase with the passage of time.

Should it be land, bungalow or an apartment? Do you want to construct on your own or would like a builder to construct it for you?

What should be the optimum size of each room? Does it meet your present and possible future requirements? This check should simultaneously be made for sizes of living room, dining room, kitchen, balconies and servant room. Does your home receive enough sunlight? Would you prefer your home to face a particular direction? What about parking? Is it open or covered? Are you getting a designated slot of parking? What about water and power supply? Is the sufficient to meet all your needs? How and when will you get telephone lines?

As the apartments are generally sold on super areas basis (which includes a proportionate component of common areas etc.) you need to check the exact internal area of the premises i.e. the carpet area.

What are the specifications offered i.e. the kind of floorings being offered, the tiles in the bathroom, kitchen, the quality of woodwork for doors, windows etc. In case of under-construction properties, some developers do not want to commit themselves on such specifications. Ask and get the same in writing from them.

When do you need it?

Do you want your home immediately or would you like to wait for a certain period? If not in an immediate need, it makes sense to opt for under construction property, as your monetary outflow is easier. It is generally over the time frame in which the property is being constructed.

You need to check, what is the comfort level you have, in case of delay in handing over the possession by the developer? Are there any penalties on the developer?

In case of under construction properties, you need to particularly check whether there are any escalation clauses.

Where do you need it?

There is no denying to the fact that you will like your dream home at a walking distance from your office, children's school, markets, hospitals, and other such basic infrastructure. However, because of escalating prices and lack of quality space in the city, there is a rising demand for suburbs.

Whilst deciding on the suburb, it is important to see, whether home you are buying is a part of self contained township. What is the level of security and who would be your neighbors? Is it well connected by the roads? Are there other residential developments in the vicinity? What is the level of greenery? Are there enough recreational amenities planned? Is there a club? What is planned for management of the complex?

 
Who is offering you your home?

The past track record of the developer, their expertise and future plan need to be examined carefully as you are investing your life-time savings. The level of commitment of the developer to the project needs to be seen.

Whether the title is clear and all formalities have been properly complied with? Whilst it is difficult for an individual to check all the legal and architectural issues; it is advised that you collectively decide to buy a home with your friends and colleagues (that way you can know your neighbors before hand, and may get better pricing from the developer). By the thumb rule, if the project has been approved by leading financial institutions, then they would have examined the legal documents. However, remember, it does not shift your responsibility and risk to the financial institution. It is your money and you need to spend it wisely.

 

What is the best price?

Developers generally announce about their new and existing residential developments through newspapers, magazines and internet. A phone call and a visit would indicate the exact picture on pricing and status on the development. In case it is not possible for you to go to the site, ask your friend in that city to do so.

There are various real estate portals, which contain details of various residential developments. We EstatePoint, conduct due diligence on certain properties and certify that the property has a clear and marketable title by awarding them as Pre Approved Properties.

The information could also be accessed through various Property Advisory Services sections of various financial institutions.

The market research on the pricing can also be done by exploring with certain real estate consultants, particularly who are operating in the vicinity of the development.

A thorough check needs to be done on the total cost of the property. Generally, besides the Basic Sale Price (BSP), the buyer is required to pay, External Development Charges (EDC), Maintenance Charges, Car Parking Charges, Club Membership Fees, Contingency Deposit and Registration Charges. These add- on, may increase the cost of the property substantially. Generally some of these charges are not financed by the financial institutions, so arrangements of such funds need to be planned in advance.

How will you generate funds?

Do you intend to buy your home with your funds, or by selling some of your existing asset. Do you want to borrow from your friends, family, or housing financial institutions?

There are some housing finance institutions offering attractive interest rates and service at the doorstep. The same could be explored.

Comparing Homes

In the real estate industry, the concept of value is amorphous. The value of a house (or condo, or co-op, or an apartment) fluctuates yearly--sometimes monthly, based on ever-changing market conditions, the condition of the home, and the costs associated with owning it.

For that reason, it's difficult to answer the question, "How much is it worth?" There is one certainty, however. The answer to true value does not lie in how much the seller wants for his or her home (though that is what the seller and the listing broker want you to believe). In fact, the listing price of a home sometimes has nothing to do with its market value.

Figuring out how much a home is actually worth is a tricky process. You'll have to do your homework, pull out your calculator, and spend some time learning to recognize certain "value markers." Once you've figured out what a property is worth relative to others that are similar in the area, you can begin to compare various homes.

Location, Location, Location
Where a home is located (within a city, within a neighborhood, on a particular street, within a single building) is crucial to determining its value. When you begin to compare homes, it's important to factor location into your house valuation formula.

Single-family House
First, think about where the house is located in relation to the entire neighborhood. Are shops and various services within walking distance? Is the house close to major forms of transportation and to the schools your children will be attending? Is it too close to any of these amenities?

Many families want to be within a few blocks of the local public school, but they prefer not to have their backyards adjacent to the school playground.

Next, think about where the house is located on its block. Is it on a corner, or on the interior row? Is it next to a high-rise building or a three- or six-flat building? Are there many homes just like it on the block? Does the block have a nice residential feel or is it mixed residential/commercial?

Apartment
If you're considering an apartment, start by asking yourself about the townhouse's location in relation to shopping and service retailers, such as a grocer. If the apartment is located within a suburb, compare its location with the premium location within that suburb.

For example, is it better to be located on the perimeter, or is an interior location better? Are end units more prized, or are middle units preferred? Are you close to the entrance of the suburb, or do you have to drive several blocks to get there? Condominium Or Co-op
The location questions for a townhouse apply here as well. If your condo or co-op is located in a high-rise building you also need to consider where the unit is located in the building. If one side of the building has a fabulous view and another faces a windowless brick wall, you can bet that units with the full view will be more prized than units with a peek-around or no view. Which is more important to you, the lower cost or the better view? Remember that a unit with the best view in a building will generally appreciate faster than a unit with only a so-so view, even if the so-so has more amenities.

Market Forces
When comparing one home to another, it's important to know what kind of market forces are shaping their value. When real estate agents and brokers talk about "markets," they mean how quickly real estate is being bought and sold. There are three kinds of markets:

• Buyer's market:
  A buyer's market occurs when there are too many homes for sale and too few qualified buyers to purchase them. In terms of supply and demand, a buyer's market means there is too much supply and too little demand. Prices tend to come down because homes are taking a long time to sell. The market favors the buyer.

• Seller's market.
  In this type of market, there are too few homes and too many qualified buyers who want them. In other words, demand exceeds supply. Prices tend to go up, and homes tend to sell quickly. The market favors the seller. Real estate agents like this kind of market because properties will turn over very quickly.

• Neutral or balanced market
  In a neutral or balanced market, the numbers of homes for sale and home buyers to purchase them are about equal. Homes sell steadily, and for reasonable prices. As you begin to compare properties in different neighborhoods, it's important to know what kind of market forces exist in each neighborhood, because they will affect the value of the properties. For example, if you like a home and it is in a seller's market, you may offer more for the home than you would if it had been in a buyer's market. Conversely, if the home is in a buyer's market, you may offer less.

How do you know which market you're in? One of the ways to find out is to ask your broker how quickly homes are being sold in your neighborhood. If homes sell in less than 45 days, you're probably in a seller's market. If homes take longer than 4 to 6 months to sell, you're probably in a buyer's market. Most multiple-listing services (MLSs) keep track of how long it takes for homes to sell. Ask your broker about the average number of days a home is listed.

It's difficult to keep all the homes straight in your head, particularly if you've toured more than ten houses. Brokers know that after seeing five to six homes, buyers tend to start confusing properties, and you could easily visit 10 to 15 different open houses on a Sunday afternoon. New subdivision designers know that prospective buyers might visit as many as 5 different subdivisions, each with 5 to 8 model homes in a weekend. That's 25 to 40 model homes to keep straight - a virtually impossible task.

Create a method for the real estate madness. Here are a few suggestions for keeping the houses organised in your mind.

Keep a written log
You can include the date you saw the house, time of the showing, and who was there (your broker, the seller broker, the owner, your mother, your father-in-law, etc.) Purchase a spiral-bound notebook and keep a dated log of each house you've seen.

Photocopy and enlarge a map of the areas in which you're most interested
As you go through an area, use a yellow highlighter to mark the streets you've looked at. Use a different-colored highlighter to mark the various homes you've actually seen in the area. You'll also want to mark the local schools, shopping, transportation routes and houses of worship.

Put the listing sheet given to you to good use
A listing sheet should contain all of the important information about a house, including it's list price, size, lot size, number of bedrooms and bathrooms, and any extra amenities. Choose a few specific or spectacular or memorable things (lime-green kitchen, beautiful greenhouse, attached four car garage, sauna in basement, pine floors, plastic wood paneling in basement) about the house and write them down on the back of the listing sheet. Draw out the floor plan. Either staple these listing sheets into the spiral bound note book you bought, or invest in a cheap 3-ring binder. Punch holes in your listing sheets and keep them (by date). If a house sells, note on it the sales price. If you don't receive a listing sheet, create one based on what you saw during the showing.

Staple a completed wish list and reality checklist to the listing sheet
It should help remind you what attracted you to the house in the first place.

A picture is worth a thousand words
Invest in, or borrow, a Polaroid instant camera and a few packs of film. An interior and exterior photo of each house will surely jog your memory later that evening, or even a few weeks later. Be sure to mark the photo with the address of each house. Better yet, staple it to your listing sheet. (Be sure to ask the listing agent for permission to take an interior photo. You do not need anyone's permission to take an exterior photo of the home.

Video is even better
If you take along your video camera, you have the opportunity to record your thoughts and feelings about a house as you recording the interior and exterior of the home, as well as the neighborhood. Also, you'll get more of a sense of what the house feels like with your video camera. (Again, ask permission. Sometimes sellers are understandably nervous about someone having a video of the interior contents of their home.) Digital is the future and the future is now
With a digital camera (they're getting cheaper and better by the day), you can actually download your photos onto your computer and keep your record of homes viewed electronically. You'll always know where the file is (especially if you give it a name you'll remember), and you'll be able to send photos of the homes you've seen to your relatives and friends. You can also pull photos of the homes that you've seen down from the Internet.

Give everyone a chance to express their feelings

If you're buying the home with another person (spouse, significant other, business partner, child, parent, friend, etc.), be sure the other people involved have a chance to write down what they think about the house.

Thank your for your Interest!