The Big Purchase (a.k.a. Our First Real Estate Investment as a Married Couple)

On February 8, 2018, the hubby and I made a major decision to buy a two-bedroom condo unit with service area and parking slot from a local developer. Project location is also in Bacoor but it cuts our travel time going to work in Manila by 6km from the average 24km. Coastal Road is merely a minute away which translates to a later departure each weekday morning when the time comes that we live there for good. Exciting times ahead!

image of the construction progress in June 2018 as lifted from the developer’s website

From Town House Living to Condo Living

Living in a town house has its perks but the hubby and I want to experience something new. You know, a different lifestyle and perspective. A lock-and-go set up. Easy, convenient, and secure community with resort-like amenities. We thought long and hard about this. We felt we needed to invest our hard-earned money in another asset and this was the perfect option. (At the back of my mind, I was telling myself that my farm house dream can wait.)

Rental Income from the Town House

With this big purchase, our plan to have our town house rented came next. Rent in our village at present ranges from PhP8,000 to PhP10,000 per month. This is more than enough to cover our monthly mortgage for the property. Our housing loan will be fully paid in 2024 and we thought the rental income would do it a lot of good. Of course, we will have to shell out money for some minor repairs that needed to be done in the house for it to be attractive enough to potential renters. But that’s a given so we’ll manage that (we have to!).

There is also the possibility that the house will be rented out by my in-laws themselves as my SIL works in Pasay City and Bacoor is an ideal place of residence for her given the location of her workplace.

Effect on our Finances

Buying a condo means money for reservation fees, downpayment (10% of total contract price, in our case), closing fees, turn-over fees, and the monthly mortgage for the housing loan (90% of the total contract price). When the condo reaches the exciting ready for occupancy (RFO) phase, there will be more expenses such as association dues, share in common areas, and utility bills. Also, interior design comes into play which requires more money. As early as last year, I was already looking for an affordable design team to help us. I will be working on a limited budget for this so I have to make sure to find great value for our money. The hubby has delegated the task of decorating the house to me and so I have to rise up to the challenge. One thing is sure, though, I want a minimalist design for the condo and I have promised myself not to put a lot of stuff in it.

With one more monthly mortgage to take care of, our savings will definitely suffer. This is going to be challenging for us but we welcome it with open arms. I, for one, have made a thorough study on the effects of this purchase in our finances and after taking several factors into considerations, got convinced that we could manage it. We are expecting a raise next year (should the national budget gets approved without a fuss) and some receivables so it’s likely that we’d be able to pull it off. Tiwala lang, Edel!

Prior to this purchase, I was looking at a 56.61% savings rate in my income alone. For me, it was a big achievement already. But after the hubby and I committed on buying (and paying) the condo, I found my savings rate going down to 20.68%. Ouch. It’s still within the acceptable level, though, and I think that will be my reality in the next 10 or so years. As for the damage to the hubby’s income, it is quite substantial as he will have to allocate most of his income to paying our mortgages (one car, one town house, and the condo itself). I just told him that I have his back and he believed me. 😛

Mid Rise Versus High Rise

The name of the residential development where we bought the condo unit is Alea Residences. It is one of DMCI’s condo projects in the south and the first in Bacoor. It belongs to the mid rise category. It is composed of four buildings with seven residential levels and a basement parking. Amenities include spacious lobby and lounge areas, bbq and picnic areas, three swimming pools, a fitness gym, a convenience store, a water station, and a laundry shop, among others. From our unit’s balcony, we get a view of a part of Manila Bay, Pasay, and Las Piñas. The nice thing about a mid rise residential development is it’s more private and less crowded than a high rise. And in the hubby’s own words, “hindi nakakalula.”

condo visit sometime in May 2019 (to be allowed entry to the condo complex, we had to be accompanied by our broker)

Destiny

When we first inquired about the property last year, it was already sold-out that we almost lost our hope to own a unit there one day. Good thing we have an efficient broker that alerted us when a unit had reopened. The reopened unit even came with a parking slot which was what we really wanted. Tumaas na nga lang ang presyo kasi 2018 na. Anyway, we immediately went to the sales office the next day to reserve knowing fully well we would be subjected to a lottery, a company policy wherein all interested buyers of a reopened unit gather at the sales office and the name that gets drawn in the raffle at exactly 9AM wins the right to buy the unit. So, feeling namin destiny talaga na sa amin mapunta yung unit at parking kasi nga kami lang yung dumating that day! (It was a weekday and we went on a half-day leave from work just to be there.) Can you imagine how nervous we felt? Those several minutes leading to 9AM were the longest for us. We prayed hard that no other potential buyer would come and our prayers were heard. Special thanks go to our two mothers who prayed with us during those critical moments. When it was declared that the unit and the parking slot would be reserved under our names and we got to pay the reservation fees, we felt a huge sense of relief. The days after the payment of the reservation fees were long and tough. We found out we got into the so-called “negative list” because of the fact that the hubby and I are both government employees and so we were subjected to further verification by the developer. But eventually, we were issued the much-anticipated Notice of Approval (NOA) kaya ang saya saya na namin dahil talagang sa amin na mapupunta. Whew, nakahinga na kami ng maluwag!

Actually, we initially wanted to buy a condo near our workplace. There was this condo project that’s being built which is walking distance from this mall near my PILs’ place. Upon checking out the 2BR model unit, we found it to be pricey for its size. We even got to see an actual unit at a nearby condo project from the same developer (the unit is owned by the hubby’s cousin who’s an OFW) and we were not too impressed. Turn-over of the units at the condo project we were eyeing then is expected next year also but given its track record and the construction activities (or lack thereof) on the project site, we doubt it could deliver the units to their owners on time. Sorry, but that’s what I felt that time (read: intuition). And we were right because until now, the construction at the project site is yet to be completed. Haha.

Step by Step, Day by Day

Buying a property is a commitment. This is the first time the hubby and I would acquire a real estate property as a married couple. (He bought the town house when he was still single and we were just bf-gf then.) Yes, we’re more confident now about this purchase but since only God knows what will happen in the future, we can only do our best to be disciplined enough to save money for the monthly payments and all other expenses that come with the purchase. So yeah, we’ll do it one step and one day at a time. And yun nga, dapat talaga aralin mabuti kung kakayanin ang gastos. It’s important to keep your emergency funds intact and make sure to still grow your retirement funds. The last thing you’d want for your property is to be repossessed by the bank, right?

The Bank Loan

We applied for a home loan with two banks, BDO and BPI. We got approved in both but found BPI’s offer more competitive so we went with it. It’s a 20-year loan with a fixed interest rate for the first five years and annual repricing thereafter. We were happy with BPI as they had excellent customer service and they communicated well with our developer. All we had to do was wait for their emails, review the loan agreement, and sign the papers when the time came.

at BPI’s head office in Makati during the loan signing

The Most Awaited Turn Over of the Unit

On September 18, 2019, the condo unit was finally turned over to us. We inspected it and found two minor problems (a bedroom door that doesn’t close smoothly and some paint stains on the glass windows) that needed to be fixed. The Property Management Office, through their construction staff, immediately worked on them while we were being oriented on the rules and regulations in the condo complex. Before we left the premises, everything was a-okay with the unit so we got to pay the turn-over fees and other payables and sign the acceptance papers right then and there.

happy but deep inside, we were already contemplating the impending gastos after this 😛

We plan to move in next year provided we have enough money to buy the essential household appliances and pieces of furniture. Good luck to us! 🙂

Have you invested in something lately? What is it and how do you feel about it? 🙂

May you choose happiness always,