4 Things You Should Know Before Buying a Condominium

Reasons why I loved living in a condominium? Well, it’s more convenient, economical and just a hop and skip away from the Supermarket, Restaurants, Schools, Malls and Hardware. Most of the condominiums nowadays are structured in an urban area where facilities and conveniences are just around the vicinity and always within your reach.

I just remembered how my husband and I decided to move in a condominium in Quezon City when my eldest child was 10, my baby girl was 9 and my youngest son was 4. It was so functional and well-designed. It has two small bedrooms with laundry cum maid’s room. I liked the ambiance and look of the interior and exterior design of that condominiun in Quezon City. We managed to live for fourtheen months  with just one all-around helper  considering that the children were still young back then. I also had that experience of having minimal electric bills because that condominium in Quezon City has a just an efficient space..

Once you’re a unit owner,  you’ll also have the rights to use the amenities and services like
Swimming pool, Gym, Mini-resto, Hall and the playground area. We don’t need to go out of town just to relax because most of the time, we spend our weekends in these highly-equipped and accessible facilities in Quezon City.

When you have visitors or guests, there are options of whether you’ll let them inside your unit or just accommodate them in the lobby. Security guards are very watchful and alert. You can find them at the lobby, securing the whole area. They will call you if in case you’ll have a visitor and will let you know beforehand so that no one can go up without any permission coming from you. Surely, you’ll love the privacy and security in a condominium.

To sum it up, it was a practical and very economical years for us.

There are lots of perks in living in a   condominium. However, there are four important things you have to understand before owning a condominium.

1.      Your proof of ownership will be a Condominium Certificate of Title or CCT

The moment you buy a townhouse in Quezon City or House and Lot in Bulacan, you will have the  absolute right over the property   ( the inside and the outside area as long as it’s in the bounds of the lot stated in the TCT and an airspace). You’ll also be given the Transfer Certificate Title of TCT as proof of ownership. On the other hand, Condominium only gives you the ownership of the unit that you purchased ( only the inside of the unit ).

2.      Condominium project has an enabling act or Master Deed

Before a developer can put up a condominium on a parcel of land, a Master Deed has to be annotated to the TCT of the lot. It usually contains information about the lot and purpose of the project.  I think, what matters most is your awareness and understanding about your rights as a “unit owner” to the use of the common areas of the condominium project and the rules stipulated through declaration of restrictions. There are also times that a declaration of restriction is a separate document from the master deed. Take time to read and understand it before you make that reservation fee.

3.      Every condominium project has a Condominium Corporation

The condominium corporation holds the “Title” to the common areas which is also co-owned by all other unit owners. Therefore, a unit owner is also considered as a stockholder to a condominium corporation. A majority vote in the condominium corporation can impart certain changes in the condominium project as long as it will not be contradicting with the Master Deed or the enabling act. Very often, the condominium corporation also manages the condominium project.

4.      Your ownership of the condominium unit is co-existent with the life of the Building

A building usually has an economic life of 50 years. Once a building becomes uneconomical and obsolete and more than 50% interest in the corporation opposed repair or renovation of the building, the building can be condemned, and what would be left will be  is only your interest in the lot as a co-owner similar with other unit owners.

Generally, a condominium is a good choice for a home because of its convenience and affordability. If chosen wisely, it can be a good investment for a family or young adult and professionals who want to start putting in their money for their future. Most of us think that condo ownership is just for the beginners and young professionals. Nevertheless, owning a condo for life is so common as this will be suitable for many families nowadays.

Is owning a condo good for you? Make sure that the condominium lifestyle is a perfect fit for you. 

Photo Credit:Land Mark
Photo Credit: To Condominiums
Photo Credit: SBLCFBC

Rent-to-own Scheme: A Go or a No?

"If you want to achieve more in  life, you should be assertive and be persistent for  everything you need or want."

 Let me share with you a story of my sister in law in California;

 "I really wanted to have a house but i do not have a bank credit yet back then.  So i tried to  negotiate  with the owners of the houses I like  if they could let me have it through rent to own scheme, I was turned down several times  but i persisted  until i  met this  old couple who agreed on a rent-to-own basis. After 5 years, I was able to build up a bank credit  and was able to build enough equity not only to fully  bank  finance the balance,   i even had extra to remodel the house."

My sister-in-law never fall short in sharing with me her story. Sounds good right?

Here in the Philippines, we can also do arrangements like that. However, most of us are unaware  rent-to-own scheme when it comes to acquiring a home.

Want to know how it works? Read it for yourself and spread the word.

According to my own understanding, a rent-to-own concept is an arrangement between the Lessee and the Lessor where in the Lessee will have an option to buy the property after a certain period of time, and you can actually negotiate this arrangement with an owner who has property for lease or sale. Well... there is no harm in trying.

Let me give you an example.

There’s a condominium for Lease in Makati and it’s open to a rent-to-own arrangement. Instead of a regular rental contract, they have this so-called “Contract of Lease with Option to buy” document. There will be a non-refundable fee which is termed as “option consideration”. If the price of that condominium in Makati is 3 Million, then the “option fee” for that condominium in Makati will be around P150, 000 to P300, 000. You can also settle this payment through deducting it in your down payment if you decide to buy the property in the long run.

There are also terms and conditions that will be agreed upon by and between the Lessee and the Lessor. Other terms might still be negotiable depending on the buyer and the seller.

Let us take a look on the advantages of staying in a rent-to-own scheme.

1. Instant equity

Experience the feeling of having an instant  home without immediately drawing out a million peso from your account. You can also have the ability to lock in a purchase price, in case home prices increase the next few years.

2. No immediate bank involvement

Admit it, it really takes time to save and shell out cash for a one-time bigtime payment. In this deal, you will be given enough time to build your credits depending on the agreed monthly payment. It will not be costly compared to a single full payment for a certain property. You will actually save a percentage from your rental payment and part of it will be credited to your down payment.

3. Hassle-free process

If in case you’ll be interested to agree on a rent-to-own scheme, it will be easier for you to dress it up as the house is  ready to be occupied. You will get used to a place with your new friends and neighbors without making a huge purchase. Aside from having time to build up a down payment and good credit record, renters have the advantage of "trying out" the house.

However, there are also pitfalls in rent-to-own scheme. At the end of the day, if you don’t buy the home, you will lose your "option to buy consderation payment". There are also rent-to-own scams so make sure the agreement is reviewed very well.  It is also not aguarantee that prices will go up, although here in the Philippines properties have steadily gone up.  Last but not the least, there might be problems on the property that you don’t know  so better do a due diligence even before entering into a rent-to-own scheme.

Anyhow, we can always try to consult professionals for further review and assistance.

Photo Credit: Why Rent
Photo Credit: Rent To Own Pilipinas
Photo Credit: Buy Homes in Detroit

Photo Credit: Ram Jack
Photo Credit: Invest in Edmonton