Lumina Sessions: 7 Signs That You Are Ready to Buy a Property

Are you having doubts or not sure if you are really ready in buying or investing in a property?

Let’s join Ryan, our Marketing Officer from Lumina San Jose, and Kristel, our Marketing Officer from Lumina Cabanatuan, as they share as the signs of to know if we are ready to start our own property investment.

Below are the factors that you need to self-assess before buying a property:

1. You have at least six (6) months of emergency fund.

This only means that you must have at least sic (6) months of all of your monthly expenses save up for emergencies but this doesn’t mean that you can use your funds to pay your down payments.

Having emergency funds also means that you have the discipline to save whenever you need to so that in the future, if you have home loans and you have to pay for them every month for years, you know that you are disciplined enough to save money to paid that financial responsibility.

When purchasing a property, make sure to include in your emergency funds the monthly payments of equity or amortization if you are planning to buy a property. It means that either your emergency funds should be uprated or you must grow it when you buy the property.

2. You have a stable income or cash flow.

You are not living paycheck to paycheck. It is ideal that you have at least more than one source of income. Living with a life quote, two is better than one is applicable to this as one source of income is not enough, as we have experienced during the time of strict pandemic restrictions.

Keep in mind that having a stable source of income is crucial at this supports all our financial responsibilities.

For OFWs, you can ask yourself how long you see yourself working abroad and if you would want to come back home to the Philippines, do you have an income source that can match your salary abroad.

Meanwhile, for our private employees or for those working in the corporate world, you should ask yourself if you can still see yourself working in your current company for the next five (5) to 10 years or if you have a plan to explore a new venture that can match your current earnings in the corporate world. Make sure that you are willing to commit when you are planning to purchase a property. Our home loan is equivalent to our commitment in our careers or jobs.

3. You know what you want and why

This applies to a lot of aspects in home buying process. Here are some of the questions that you must consider:

• Do you want a condo or a house?
• Do you want to have a family?
• Do you want to have a car or multiple cars?
• How many rooms do you want or need?
• Are you going to have house help?
• What location are you looking at?

All of these questions can help you in buying a property. In addition, you can also attend open houses and talk to agents or brokers to get more insights about the properties.

It’s much better if you have more ideas about the neighborhood that you would like to live in as well as the type of home you would like to have when you start your home investment. Some of the types of houses you may encounter are townhouses and duplexes.

There are a lot of community developers these days but with Lumina Homes, homebuyers can have the assurance of the affordability, quality homes, practicality, and accessibility of the whole community.

4. Your long-term plans don’t require you to move.

This long term plans that might require you to move are your workplace, your spouse or partner, or a family member. Yes, it’s true that you can have it maintained by a housekeeper you trust if you don’t need to live there for some time but once they move out, you might find a hard time finding someone that you can trust your property with.

It is ideal to move in but in this case, you can also rent out your property.

5. You should have other investments.

Real estate is a great investment but it would also be great if you will have other investments such as stocks, funds, or savings program that earns a higher dividend rate as well as insurances.

Insurances are also great especially if you are planning to get some housing loans. These are important to prepare you in case of future emergencies which could help you cover your property investment in the future.

6. You have 30% down payment saved up.

It is essential that you have at least 30% down payment saved up since there would be fees that you need to settle such as reservation fees, down payments, transfer fees, as well as other costs.

These savings will not just give you the preparation that you need but also lets you settles your down payment on the spot to get discounts when you pay them in lump sum. It would also avoid you to have lapses in the future with that percentage of amount set aside.

7. You do not have a bad debt.

A bad debt is an expense that a business incurs once the repayment of credit previously extended to a customer is estimated to be uncollectible and is thus recorded as a charge off.

Below are some examples of bad debt that you have to avoid when you are going to invest in a property:

• Credit card debt. Spending you credit card on things that not considered as an asset but liabilities.
• Debt on family or friends. It is better if you can pay first your debts to your family or friends before getting a home loan since they might also need the money and this will also measure your financial capabilities to pay loans.  
• High interest loans or debts. These are debts that have higher interests particularly when you use it in discretionary spending or on things that can easily lose its value.

Having a good credit will give you a better chance of approval for your home loan as it will be easier to build relationships to this type of lending institutions. Consistency of payment and paying on time also gives you a higher chance of approval rating for your housing finances.

Additionally, we advise you to pay your taxes and learn to know about Income Tax Return since loan institutions would go through your finances to see and to make sure that you can really afford to have a property.

Lastly, make sure to do you research as it is better to be knowledgeable about real estate before starting your property investment. Terms, loans, and contracts are just some of the things that you need to get familiarized with.

Now that you know the signs, you can now identify if you are ready for a home investment. Start you homeownership with us and visit the official website of Lumina Homes.

See you on our next Lumina Sessions!