Make Your Sacrifice Count: Investing in Real Estate


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Image courtesy of scottchan/ FreeDigitalPhotos.net.

There are many forms of investment that OFWs can look into so that they can make their hard-earned savings grow, and one of them is real estate. While there are those who say that it does not necessarily guarantee a good and quick return, there are many reasons why it is still a profitable investment. Consider the following:

Real Estate is an Appreciating Asset

Unlike cash that loses its value over time or stocks that are dependent on an ever-volatile market, real estate generally appreciates over time. This is because the demand will always be greater than the supply. Even in bad economic conditions, the value of real estate normally grows with the inflation rate. If you are risk-averse or would prefer an investment whose value won’t dip or rise suddenly, then real estate is your best bet. Moreover, if the property is in a strategic location and is in a well-planned and well-built community, you can rest assured that the value will only increase in time and you can figure in a profit when the time comes that you will sell it.

There are Income Opportunities from Owning Real Estate

Fancy being a landlord? You may not opt to live in your recently acquired house or condo especially if you and your family are comfortably settled somewhere else. But you can rent out your property and earn money from it. You can even plan it out such that the lease price can cover your mortgage or any other expense you may be paying for your house or condo. Because you own the property you can also control the increase in the rent every year. This means that you can even have an increasing return from your investment. What you can potentially earn from it may be more than if you put your money in a regular savings account in the bank.

Real Estate is a Tangible Piece of Investment

When you invest in mutual funds, or even take out insurance, all you have is a piece of paper that is your proof of investment. In the event of an adverse situation – the bank or the market collapses for instance – you are then left with nothing else but paper value which you may not even be able to convert to cash nor receive the full value at the end. Not so with a house or a condo; this is something that you can see, feel, and even use. You can have the confidence of knowing that your investment is not tied up to a financial institution’s performance and you can fully enjoy the fruits of your hard-earned labor. Aside from this, you can use your property as collateral when you are applying for another loan or financing assistance from the bank. Leveraging on your house or condo unit when borrowing money can at times be advantageous as it can get your loan approved faster and you may even get a lower interest rate. You cannot do this with a deposit product or even stocks.

There are Tax Benefits from Owning Real Estate

There are ways by which you can lower the amount of tax you have to pay for your house or condo. For instance, if you are paying the amortization or mortgage, you can deduct a certain percentage of the interest that you are paying from your taxable income. You can also look into declaring a lower value on the property and take it out from the taxable income portion of your returns. Your property consultant can help you figure out how your tax payments on your property can be manageable.

You Get Discounts and Other Incentives from Purchasing Real Estate

When you put your money in a mutual fund or buy bonds, the price is fixed and you do not get any other added value for your money. With the way property developers are aggressively marketing real estate nowadays, you can get a lot more for what you’re shelling out. If you’re paying in cash, there are developers who offer as much as 20% discount on the selling price. This means that if you’re looking to purchase a 5-million-peso house or condo, you can even get 1 million pesos back. There are also other kinds of incentives such as zero interest rate or complimentary services.

The Philippine Real Estate Market is Growing

There is never a better time to invest in a property in the country than this time. The economy is on the upswing and that means that major sectors such as real estate are also on an upward trajectory. Growth does not only refer to increasing property values but also to the quality of the development projects that are being built. Nowadays residential properties are more responsive to the needs of urban dwellers and are at par with internationally-recognized developments in terms of architecture and design. Moreover, according to an article posted on Yahoo! News, the Philippines has one of the lowest property prices in the Asian region. This is based on a recent study by Global Property Guide that compares square meter prices where the Philippines ranks 9th among 11 countries. This, combined with the wide variety and availability of choices give buyers more opportunities to find the right match for their investment needs and budget.

To realize a more optimal return for your money, check with a reputable real estate agent on properties that are offered on the “pre-selling” stage. This means that the development may not have yet started or is ongoing. At this point, the prices are typically at their lowest and you can get to have prime choices on the location as well as the type and size of property to get. You can check out profitable real estate investment options, like Megaworld’s full portfolio of residential developments that are well-designed and well-planned. Aside from being located in strategic growth areas in the metro, they are built with the strictest adherence to world-class standards.

By: Nicole Adarme

Author: Megaworld at The Fort

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