A great question came into the “Ask The Broker ” inbox this morning:

Q We are moving to Manila next year (Jan- Feb 2013) and have found your site and blogs very useful… and entertaining as well! Thank you! We wanted to buy immediately, i.e. not rent while we look around for a suitable house. Is this a feasible strategy in this market? and if so, when should we plan our first visit?

Our plan was to 
1. Short-list online properties we were interested in and set-up oculars 
2. Visit in the latter part (?) of the year and choose 
3. Get all the payments done so we can close and move-in when we arrive in Jan/Feb. Will this work or could too many things go wrong and would you advice to rent and look around while in the area. Any information you can provide would be helpful.

A First, thanks for the kind words. I’m glad you find this a useful and entertaining site 🙂

Here are my thoughts…

It probably goes without saying that relocating and purchasing a home are two things up in the list of “High Stress Activities”. If you go shopping and buy the wrong size shirt, a bad freshener, or food your family won’t eat, that’s not such a big deal. Buy a home in the wrong area for you though, that is a big deal.

Ideally, we recommend that if you are relocating and not familiar with the Metro Manila Area that you rent first before you buy a home. Renting affords you the time to scrutinize deals and areas and not be ‘forced’ into getting a property since you have a deadline.

The benefits of renting first:

1. You get familiar with an area before making the home purchase plunge.

If you don’t like where you end up renting, you can rent somewhere else. Or at least drive around different areas at different times, watch listen and observe the local area and news – basically get a long term, in-depth feel of different areas. In Manila – most suitable areas are in the vicinity of Makati, Global City, Ortigas and Quezon City. Depending on lifestyle and need would attract you to these different areas respectively.

2. Less initial cash outlay. Buying is expensive, even if you have office assistance. For rentals, a normal term of rent is 3-3 or three (3) months advance and three (3) months deposit and 9 post dated checks. The advance payment will be applied on the last three months while the deposit will be returned 30-60 days after the lease when utilities are all paid. Some lessors/landlords charge a 12-2 or twelve months advance and two months deposit.

3. Reduced stress as you will have more time to research and validate what areas at what price to buy best!

The disadvantages of renting first:

1. You have to move multiple times. Let’s face it, moving is stressful.

2. If you have children, unless you rent in the same school district you ultimately purchase in, then the kids may have to switch schools.

3. Properties are increasing in price. You may have to buy 10-15 % higher.

So answering the question posed is difficult. Ideally, you probably want to rent first.

The more time you can spend here in Manila, the better. It is ‘great’ if you can drive around the areas you’re looking at different times of the day. Drive the route you’ll take to work – at the time you’ll be going to/from work. Get a feel for the neighborhoods – the malls, schools, hospitals, and other areas you may ne interested in. The better feel you get for where you’ll be living, the more comfortable you will be throughout the home buying process. And even beyond.

If you can only make one trip however, all is not lost. We’ve helped people relocating that had ONE DAY for a house hunting trip and had NO IDEA where they wanted to live. It makes for a brutal and rather tiring day, but it can be done.

Which is better a condominium or a house? Again, depends on a lot of factors but we can sort them out for you.