For most Filipinos, food, shelter, and clothing are the basic necessities of daily living. However, many households assume that they can only afford two out of three. On the way to work, many workers will encounter billboards for new housing developments located in emerging areas. Meanwhile, real estate agents stationed at malls will hand over flyers touting new condominium units from major developers. The prices, which often run in the millions, can often deflate even the most hopeful consumer. Despite their dreams of owning a home, the prospect of house buying in the immediate future seems bleak.

However, many employees might be mistaking the trees for the forest. Buying property isn’t exclusive to new homes in established areas. Of course, home prices are high when demand is similarly high. However, there’s more to Philippine real estate than new condominiums in Makati Ortigas, or BGC.

Working Filipinos pursuing their house buying dreams should take comfort. Buying a home is very possible. It’s a matter of looking into several factors and checking what works best for you. In the case of house buying, it’s time to reexamine income levels, available home options, and long-term commitment.

How Much Do Filipinos Need to Earn to Afford Owning a Home?

Realistically, working on minimum wage makes it nearly impossible to initiate plans to buy a house. At P610 a day (in Metro Manila, lower for other areas), the monthly minimum salary ends up at P13,420. This amount is hardly enough to rent an apartment, pay for food and utilities, and cover commuting costs.

Then again, house buying requires a salary that is a bit more than minimum wage. In a blog post talking about average salaries in the Philippines, Timechamp lists the average salary rates for a number of jobs here in the country. An IT worker starts at P20,000 and can go as high as P100,000. Finance, banking, BPO, and healthcare jobs start lower at P15,000/month but can also go up to P50,000 or P60,000 depending on specific duties and responsibilities.

To accomplish any house buying objective, Filipino workers will need to earn beyond a basic wage at the minimum. Ideally, they should aim for a few promotions or work hard enough to merit salary increases over the next few years. While it’s possible to buy a house and lot package with a P20,000 monthly income, it assumes another member of your household is helping pay the rent, food, and other bills.

The 30/3 Rule

To answer the question of how much a Filipino needs to earn to afford a house, let’s look at the widely-accepted 30/3 rule. This maxim states that homebuyers should allocate a maximum of 30% of their monthly income for home mortgages. At the same time, the total home cost should not exceed three times the annual salary of the entire household.

A household earning a combined P40,000 monthly earns around P520,000 a year. Multiplied by three it means that ideally, the household can afford to buy property worth up to P1.56 million.  It also means that they should shell out P12,000 (30%) of their monthly income to pay their mortgage.

Here’s the good news: A cursory check of Ohmyhome’s listing of homes not exceeding P2 million yielded 77 results. Then again, many might dismiss the listing as full of lot-only properties located in faraway places. They couldn’t be more wrong. Ohmyhome lists house and lot packages in suburban areas like Cavite, Laguna, Rizal, Pampanga, and Bulacan that carry a price tag of between P400,000 to P1.1 million.

House Buying Options Based on Income Levels

Ohmyhome, the Philippines’ premier property tech platform, has a very helpful search engine that allows for an easier house buying process. Users can narrow their search criteria based on property type, location, price, and turnover date. The latter category can help determine if a property is currently under construction, which means the developer is likely selling at pre-selling rates. 

The saying carpe diem applies to this list of property recommendations. Philippine real estate usually requires a down payment equal to 20% of the unit price. For those with lower household incomes, it might take a while to raise the DP unless you have other sources of income. To reach your house buying goal faster, your household might want to practice financial discipline and consider saving up or investing any excess income that comes your way. As we mentioned earlier, buying a house is a long-term commitment that will require some sacrifices. However, those who do can expect a great return in the future.

For the recommendations below, Ohmyhome sampled three types of property for each income class: a house and lot unit, a lot-only package, and a condominium studio unit.

Low-Income Options

Low-income households earning minimum wage up to P21,914 should hold off from buying property at the moment. If you have another household member earning similar amounts and can shoulder monthly expenses, there are several properties worth less than P1 million that can fit your budget. This includes Bella Vita properties, one of the country’s many proponents of low-cost housing. With its subdivisions spread all over the country, Bella Vita Land offers very affordable house and lot options starting at P400,000. In addition, other options such as Active Land’s Town and Country San Pablo (Laguna) and Fortune Star Condominiums (Caloocan) have units costing less than a million.

Middle-Income Options

Households earning between P43,828 and P76,669 are classified as middle income. Those who belong to this group include licensed professionals such as engineers or architects with a few years’ experience under their belts. With a larger disposable income, they can afford projects such as Pacifica’s Hamana Homes detached townhouses in Magalang, Pampanga. You can also check out Antel Land’s Anyana lots in Tanza, Cavite. Magalang and Pampanga represent two of the emerging economic hotspots in the country today. Expect your investment of P2.8 million (Hamana) and P3 million (Anyana) to continuously grow in value.

Meanwhile, middle-income earners working in Metro Manila can check out studio units at Galeries Tower Manila. Located at busy Taft Avenue, you can own a studio unit measuring 25.66 sqm for P3.7 million!

Upper-Middle Income Options

In the meantime, households with income levels of P76,669 to P131,484 have plenty of property prospects available to them. For those busy working down South Luzon, you can check out an 80 sq m  three-bedroom, 2 toilet and bath masterpiece at La Verne Residences, Bacoor, Cavite worth P7.2 million. Meanwhile, those looking to invest in beach properties might find a 205 sqm lot at  Playa Laiya at San Juan Batangas worth P4.5 million more to their liking. Finally, NCR professionals with business in Ortigas Center can appreciate owning a condo unit at the Olive Place at Mandaluyong. Located at the busy Shaw Boulevard area, there are maximum lease opportunities for workers looking for accessible lodgings near Makati, BGC, and Ortigas. Studio units start at P5 million.

Upper Class Income Options

If your household is earning between P131,483 to P219,140 per month, you’ve got yourself plenty of breathing room to make substantial property investments. Consider investing in a hidden gem of a place such as Victoria South of Alabang, where a 240 sqm house and lot package starts at P10.8 million. Alternatively, you can also look into owning a lot at Verdea in Silang, Cavite. As one of the fastest-growing industrial centers in the country, investing in a P13.9 million property in the Silang area can pay off dividends in the long term. Finally, those looking for their next Metro Manila investment should consider DMCI’s Valeron Tower along C-5 road in Pasig. Prices start at P8.8 million for a studio unit measuring a generous 32.5 sqm.

Upper-Upper (Rich) Class Income Options

Households with monthly incomes that exceed P219,140 shouldn’t have problems choosing the house they want. Those who want to immediately move into a townhouse in an accessible location should look into Chelsea Place in Quezon City. With only four units built, a P32 million investment has a great chance to appreciate over the years. Meanwhile, those who prefer getting a lot-only package can check out Greenfield Development’s high end residential enclave Trava. A 568 sq m lot package currently sells for P22.8 million. For those who want an ultra-premium address, Federal Land’s The Seasons Residences is your ultimate urban residential address. Owning a Seasons Fuyu Tower 1-bedroom unit is the culmination of all your hard work. Prices start at an even P25 million.

Ohmyhome Has the Properties You Want Across All Income Levels

House buying will always be a viable option as long as you know what you want and know your abilities. You should always know that buying property requires a serious commitment that can take decades to complete. Aside from setting aside a portion of your monthly income, you’ll also need to make sure to continually provide for your household’s needs.

Ohmyhome is always there to help you match the right property with your budget. There are plenty of options out there that fulfill your requirements for location, amenities, and budget. Aside from our platform, we also have a team of licensed real estate professionals to help you acquire the home of your dreams and get the best financing options.

To start your house buying experience, sign up today for a free Ohmyhome account. We’ll help you achieve your dream of acquiring your own property and be there every step of the way.