Whether you are an aspiring homeowner or planning to invest as a business venture, deciding to purchase a beautiful piece of real estate like a condominium is always exciting. But along with it comes a whole list of items to consider and calculate in the decision-making. There are so many things to think about that oftentimes, especially for first-time buyers, some key points are overlooked and missed.
In this article, we highlight some important factors that are often least considered but are equally important to make your investment more worthwhile.
1. SHOP FOR THE BEST INTEREST RATES
Purchasing real estate means taking out a mortgage loan, which ultimately means you paying interest until you pay off your property, which is going to be awhile. So it is very important that you get the lowest interest rates possible. To do this, you need to take your time “window shopping” for banks to get the lowest interest rate possible. In the long run, this will save you a huge amount of money.
2. BUDGETTING
The most common budget points people concentrate on when buying property are the initial deposits, move-in fees and the monthly payments, but there are actually a few other figures that buyers seem to forget to factor into the budget planning that can cause future surprises. Here are just a few:
Homeowners Association Monthly Fees
These monthly payments will have to be paid for as long as you intend to own your property, so it’s important to include this when calculating your budget. This will include the maintenance of amenities and common areas, salary of building staff, and so much more, but most importantly includes insurance, just in case something happens to your building.
Real Property Tax (RPT)
This is an annual fee that also needs to be paid for as long as you intend to own your property. The amount is calculated based on the assessed market value of your property and the location. Delay or failure to pay these taxes can result to penalties, or worse, foreclosure of your property, so non-payment is definitely not an option, making it a very important addition to your budget planning.
Maintenance Fees
This item is most applicable to those who will be renting out their condominium unit. In theory, it would be wise to keep some sort of a petty cash fund for maintenance and repairs inside the unit which will expectedly be caused by natural wear and tear. These expenses will always come unexpectedly, and you never know how much they might cost, so it is important to set aside funds that you can use right away to avoid complaints from your tenants.
3. CHOOSE A RELIABLE DEVELOPER
Buying a condominium is no doubt a huge investment, and unless you plan to sell it at some point, you would want that investment to remain standing for you to enjoy 30, 40 or over 50 years down the line. The main question after a long stretch of time will be the building’s structural integrity, so you would want to choose a building whose developer has more experience, higher credibility, and a better reputation. Because at the end of the day, you know you will be in better hands with a reputable company.
In most cases, it may come out as more expensive, but you can’t put a price tag on long-term safety and durability for your investment.
All these and more, are important things to consider when you are trying to invest in real estate. It is a huge undertaking after all. So take your time, research, do the math, and choose wisely.
