10 Tips in Buying Real Estate in Cebu and the Philippines
Cebu Real Estate continues to stand proud of its booming real estate development which great success by leaps and bounds
as compared to any city or area in the Philippines today. While Cebu continues to enjoy a robust real estate industry, it
is important that buyers need to be well educated in order to make the most out of the real estate market. These top ten tips
to buying real estate will help you enter into your next real estate transaction with confidence.
TIP #1: Contact the right Agent or Real Estate Broker
Contacting the right Real Estate Agent or broker is invaluable. In Cebu or even in the Philippines, you need not hire
an agent or broker but just contact them and they are more than willing to help you find the property your are looking for
in a manner as if you are hiring and paying for them. The small percentage of income from sellers/developers is already substantial
for them that they no longer impose commissions from buyers. If you are unfamiliar with the area, the realtor you choose is
your link to important information regarding schools, zoning, city and county regulations, neighborhood trends, building and
remodeling and rental restrictions, and property values. Every city has different laws governing what can and can’t
be done with a property. You can find an agent or broker from friends or associates, directories, housing exhibits on shopping
malls and nonetheless, the internet. It is important that you have a background of your prospective agent or broker and seek
initial contact to find out if he can possibly do business with you in helping you find the property best suited for you.
TIP #2: Pre-qualify for Financing
Pre-qualifying for a loan may not seem that important until you find your perfect paradise property at the same time as
another buyer. When a property is priced to sell, it will usually attract more than one buyer. Once a seller receives an offer,
the two most important things they consider are …the price, and the contingencies. For some sellers, a contract
contingent on the buyer obtaining financing makes them uncomfortable with the offer.
Eliminate any doubt in the mind of a seller, by pre-qualifying for the amount you may spend on the purchase of any property.
This is especially important if your dream property suddenly has a price reduction. When this occurs other buyers might come
into the picture, that didn’t look at that property before it went “On Sale”! Often times a
seller will take a financially solid contract over a higher offer. Be ready to put a deal together!
TIP #3: Consider the "best location" suited to your needs and situation.
“Location, location, location”, while overused as a real estate phrase, is still and always should
be a huge consideration to you as the buyer. If something about the location of a property bothers you, be aware that the
same location drawback will bother any buyer you hope to attract when and if you need to resell the property. It’s
important to ask a lot of questions, but often times it is difficult to know the right questions to ask if you are unfamiliar
with the community. This is why it is so valuable to choose and hire the right real estate agent to represent your interests
when buying a property. You will have to consider the areas that you need to be frequent such as your place of work, the school
of the children, distance to malls for your groceries, and consideration also for churches and contingencies such as hospitals
in times of emergencies. More often, the desired location commands a higher price and the less desired are almost always affordable.
The important thing is to strike a balance between affordability and location as it is most of the time extremely difficult
to get the best of both worlds.
TIP #4: Get a Home Inspection
Obtaining an inspection report performed by a licensed professional building inspector of your choice, can protect you
from many defects that are hidden from view. Why gamble with such a large financial investment? Let a professional building
inspector point out areas to be fixed or replaced that aren’t obvious. A good inspector will give you a lengthy
report covering all systems in the home from electrical, to plumbing, to roof conditions, and structural concerns.
Once you receive a report you may begin negotiations again concerning repairs. Often a seller will agree to make necessary
repairs up to a specified financial amount. When a seller lists their property “as is” they are letting
you know that they are not willing to fix or replace any part of the property. If you are interested in an “as is”
property and aren’t going to level the structure and build new, it is still in your best interest to obtain an inspection
report. Don’t rely on the building inspector to look for termites and other harmful pest problems. Although an inspector
will see pest damage, it is best to have a separate termite inspection conducted by a licensed company that understands pests
and can eliminate them.
TIP #5: Obtain a Survey
Surveys will show easements, encroachments, and boundary lines of a property. By surveying a home in an established neighborhood
you are assured that the property boundary lines have been maintained. As homeowners add on the their properties over time
with fences, sheds, docks, garages, and other structures, boundary lines can be crossed placing part of their structure on
your property, or vice versa. Surveying vacant land is also important for same reasons as a home, plus a survey will help
determine the size home, or amount of coverage the lot will allow.
TIP #6: Be Practical and Realistic
“Wants” and “Needs” are very different when is comes to real estate features.
If every home you see has the upgrades you “want” but exceeds the price range that you “need”….
be practical and realistic. Who wouldn’t love a large, oceanfront, professionally decorated home or condominium,
with all the bells and whistles? Looking at properties that exceed your price range is always fun, but it can be extremely
frustrating and upsetting. Be realistic by looking at listings in the price range you “need”, keeping
an eye out for that special property that has the potential to evolve into the dream home you “want”.
Always look beyond the furnishings, wallpaper, and floor coverings to the architecture of the home; it is then that you will
find properties with potential.
TIP #7: Use Contract Contingencies Wisely
Contingencies in a contract for the purchase of a property are designed to protect you, the buyer. This may seem silly
to mention but it’s important to remember that you need to work with the seller to come to an agreed upon contract.
Valid contingencies to an offer are expected by the seller. Common contingencies include building inspections, termite and
pest inspections, financing, and surveys.
Many deals fall apart over small details, and easy to fix issues. Remember that sellers are emotional about their property.
If you can see that major repairs or replacements need to be made due to neglect or age, make allowances for this in your
offering price. The old adage “Everything is negotiable” still holds true, unless you upset the seller
so much that they refuse to work with you. Try to avoid listing cosmetic changes you would like the seller to make as contingencies.
Cosmetic changes are subjective, be objective when writing a contract.
TIP #8: Understand Regional Health and Safety Issues
An informed realtor will help you understand other health and safety issues that should be considered when purchasing
a property. Safety and Health topics can include indoor air quality, mold, radon, and lead paint. Many of these require the
seller to sign a disclosure statement, while others may not apply due to the age, type of construction, or location of the
property being purchased.
TIP #9: Ask for Information
When you have contacted a realtor to work for you, ask him for information. Do you want to look at all the properties
in your price range, with the features you need, or just the houses a realtor wants you to see? You deserve all the information
you need to make an educated decision. Can you imagine buying the home that you felt was good for your family, only to find
that you never received information on a similar property that is perfect for all your needs? I provide many services to insure
my buyers always have information at their fingertips.
TIP # 10. Be aware of economic and political stability of your specific location.
The area may appear to be stable or progressive but the presence of only one Company monopolizing the industry of the
area may cause a risk of sudden economic plunge and will have a damaging impact of the real estate industry in the area. A
Japanese Company for example in Compostela Cebu is the single biggest company monopolizing industrialization and employment
of manpower in the area. In times of crisis or when the Company decides to down size or worse, shut down, the domino effect
on the real estate industry in the area can be catastrophic. Many workers who are renters can no longer afford to rent; others
who have houses on mortgage can be delinquent in payments until their mortgaged homes are foreclosed. The area has the right
balance of financial resources of residents appear to be more stable.