As we enter a new decade, more and more Filipinos are looking into investment as a means to grow their money. Building passive income has become more critical than ever, and investing is one of the best ways to achieve financial security. Many people choose to do so via the currently lucrative business of property investment.
It’s no secret that real estate investing in the Philippines has been booming for the past few years. The country’s status as a top tourist destination, the rise of BPO firms and technology companies, an abundance of OFW remittances, and government support for Philippine offshore gaming operators (POGOs) are just a few of the factors behind the thriving real estate market in the country.
This growth is felt not only in Metro Manila, where new condominiums, office buildings, and shopping centers seem to pop up every few weeks or so. The demand for commercial, residential, and mixed-use properties has also increased in the so-called new-wave provincial cities.
In case you’re now interested in buying some residential buildings and, perhaps, turning to condo investment, you need to know some helpful tips before closing the deal with your seller.
Experienced investors may have an agent who will negotiate for them. Filipinos who are taking their first steps in investment, however, may not have the same resources. For this and other similar situations, here are five ways to bargain with the seller so you can buy that property or invest in the condominium of your dreams.
- Act fast
Anything can happen when you’re buying and selling. Property prices can be erratic, so once the seller responds to your offer, you should act as soon as you can—within 24 hours if possible. Delaying your response would only give other buyers a chance to grab the property you want. The seller may want to close as soon as possible and accept the amount you’re willing to pay.
Make a comparison with similar deals
Do some research on other transactions made in the area. Did a similarly sized building in the neighborhood sell for less than the price offered to you? Perhaps other condominium buildings have been purchased at the amount you want and not any higher. Share your research with the seller. Through bargaining, you could convince the property seller or manager that their asking price is too much and that you’re the best chance they have to sell the property at a price that’s still considered competitive.
Raise your offer
If the particular building is as good as it seems, the seller is likely looking at multiple deals simultaneously. One specific building may seem perfect for your purposes—no significant structural defects, not much maintenance necessary, located in a safe neighborhood, tenants likely to be satisfied—except for one crucial problem: the price is too high.
While you certainly don’t want to overpay, adding to your offer might give you an edge over other would-be buyers and make it more enticing to the seller. Make sure that the added cost stays within your budget, however. Remember that you are buying property to turn a profit. A price that is much too high could lead to less productive investment in the long run.
Sometimes, it’s not all about the money. Compared with first-time investors, the more experienced ones make time for creating a smooth relationship with the seller. Talk to them and figure out why they think their property is worth as much as they’re asking. These conversations could give you clues on how to make them see from your perspective and vice versa. Perhaps both of you could reach a mutually beneficial compromise. Something as simple as giving handwritten thank-you cards after a showing could mean great results for you.
Know when to give up
If you’ve followed all these steps and the seller still won’t let you purchase at a lower price, it might be time to move on. Changing your initial plans may be difficult, but stay positive and keep an eye out. Another perfect property with an eager and willing seller could be right around the corner.
Investing in property has always been a low-risk business. It is known to be one of the safest investments you can make. Property values will only appreciate over time, and this provides investors with the financial security that many Filipinos aim for.
Whatever the result of your negotiation, it would not be a wasted effort. You will have acquired valuable experience that will be useful for the rest of your journey as a real estate investor. Monetary gain may not be immediate, but, as experts predict, this industry will stay stable and resilient for years to come. So keep trying, and you will achieve financial security because of your investments in no time.