So why does purchasing a second home interest you so much? Is it the opportunity to grow your wealth? Is it because the idea of having a vacation home in the province intrigues you? Or is the family getting too big for your old one?
Whatever your motivation is, just know that the costs for buying and maintaining a second property depend on how you’re going to use both of them. Think carefully about the returns you expect, the area where you’re buying, and additional fees. You never know, those planned trips you were supposed to take next year might get pushed back because of the hefty bill.
It’s a pretty risky investment, to say the least. Still, the best thing you can do is to just be ready. Once you have a clear goal in mind and know how to finance the property, then the real planning can start. Here are a few pointers to get you started.
Buying as an Upgrade/Investment Property
A lot of this depends on your intentions for your old house or condo. Are you thinking about turning it into a rental property? If so, take into consideration the utilities when it remains unoccupied for longer periods of time. Examine the current state of your property, market, and location. How long would it take to find a renter for it? If it takes too long, then you’re hemorrhaging money just on utility bills alone. Make sure you have an emergency fund for this!
You obviously need to make the house livable, too. Furniture and various housing fees add up. Seasonal maintenance, like pruning dead leaves, mowing the lawn, fixing clogs in the gutter, and more will mean that you should have a budget for upkeep.
Investment properties require all these, as well. Remember, rental income isn’t a guarantee, especially now. Yes, flipping homes have become quite popular these days. But would it be worth it to renovate your space, given a weaker renter’s market? As we’ve all come to learn from the pandemic, vacancy dry spells happen in real estate.
Buying as a Vacation Home
Waking up to scenic views, clear skies, and beautiful seas does have its appeal. All of us would love to do that every day. What a life, right?
Keep in mind, however, that buying a vacation home in a different province or city means that you should have a decent budget for those trips back and forth between your two properties. Trust us, it’s going to cost you a lot more than you bargained for.
Also, consider how often you’re going to visit that property. Wouldn’t an airbnb suffice if you only plan on going every Christmas break and Holy Week? Vacation rentals are great in theory, but they don’t always make the most practical investment choices.
Buying as a Gift
Okay, this isn’t exactly for everyone. But maybe you have that kind of money to spend! Why not? Whether it’s for a family member or for someone in need, buying property as a gift is a love language in itself. Now that’s some next-level generosity right there.
Hopefully, these factors to consider won’t discourage you. Investing in another property can be tricky if you do it willy-nilly, but the potential returns you get when you do it the right way are just too good to pass up. The higher the risk, the higher the reward, after all.
Are you looking to purchase a property? Get in touch with an Ohmyhome property agent today.
Ohmyhome was launched in the Philippines in September 2020, following the company’s establishment of a tech team in the country in 2017. Ohmyhome was originally founded in 2016, and subsequently rose in Singapore as a leading PropTech solution and licensed real estate agency.
Ohmyhome expanded into the Philippines so that Filipino home seekers can have a real estate partner that they can trust to have their best interests at heart and can be relied upon to provide exceptional services throughout the entire property journey.
Featuring thousands of properties across many of the Philippines’ major real estate brands, Ohmyhome differs from other local platforms by going the extra mile and extensively helping buyers narrow down their choices and find the property that best suits their budgets, home needs, and lifestyle preferences.
The company’s real estate agents not only help in the shortlisting of options but also provide professional services through the entire purchasing process. These include assistance in property inspections, negotiations, the finalization of the Conditions of Sale, deposit collection, the submission of property documents, as well as providing buyers regular updates.
Ohmyhome helps Filipinos find their dream homes, all while making sure each real estate transaction is complete and is an efficient and enjoyable experience.