What to Remember before Buying a House and Lot
Things to Keep in Mind when Purchasing a House and Lot in Baguio City
Indeed, it can be scary putting money you’ve earned the hard way in real estate if you’re doing it for the first time, more so if you actually have no idea what you’re getting yourself into. It’s even scarier buying property in a city like Baguio, which, more often than not, is asssociated with summer. That is why it pays to have a trusted real estate broker in Baguio City who can help you make wise and informed decisions as far as buying a house and lot in Baguio City goes.
Assuming you have made up your mind and decided to purchase a house and lot in Baguio City, is that all there is to it? Not quite. There are some things you need to remember before buying a house and lot and closing the deal with a real estate broker in Baguio City. Here are those:
1. Ensure that the area where you’re buying the house and lot from is flood-free.
Let’s face it; Baguio City is vulnerable to flooding and landslides. Obviously, that is something you won’t have to worry about too much if you’re buying a condo in Baguio City. A house and lot is a different story, though. Hence, the first thing you need to ensure is if the area you’re buying the property from is flood-free. Nevertheless, don’t make the mistake of asking your agent if the area is flood-free because, chances are, he will not tell you the truth. If you really want to know if an area is flood-free, ask a “sari-sari” storeowner. The answer she’ll give you will most certainly be unbiased and honest.
2. Verify the authenticity of the property’s title.
If you’re purchasing a second hand property or one from a private listing, it will be a good idea to verify the authenticity of the title. The last thing you want is to pay a huge amount of money for the property only to find out you have a fake title. A good way to find out the veracity of the title is to go to the Registry of Deeds (RD) in Baguio City, ask them to look up the property, and if they find it, request for a Certified True Copy (CTC) of the title.
3. Make sure to ask about the finish of the property.
There are three types of finishes as far as a house goes – bare, fully-finished, and fully-furnished. Bare means there is still a lot of work needed to get the house ready for occupancy. The walls and floors are still bare; no paint, no tiles – totally bare. Fully-finished means the house is already painted, tiles are in place, and there are fixtures like cabinets in the house. Fully-furnished means the house is fully-finished and has appliances and furniture, too. Of these three types, always go for fully-finished or fully-furnished because the last thing you want is to spend more or less Php 900,000 on a property that’s not even ready for occupancy or move-in.
4. Are you purchasing a property in a formal subdivision?
Don’t fall into the trap of buying a house and lot in Baguio City assuming that it’s in a formal subdivision when in fact, it’s in an informal subdivision. What’s the difference between the two? A formal subdivision has guards, both stationary and roving, a property management office, amenities, and is fenced or gated. On the other hand, an informal subdivision is merely a large piece of developed land subdivided into streets to create an impression of a “subdivision”.
5. Always ask if there is subdivision dues involved.
Just as there is association or tenants’ dues paid when you live in a condo in Baguio City, there are so-called subdivision dues, too, that you need to pay when you live in a formal subdivision. These dues are used to pay for security guards’ salaries, common utilities like streetlamps, and maintenance of the subdivision.
6. Ask if there is minimum construction cost or height restrictions in place.
Minimum construction costs or height restrictions are usually put into place as governed by parties involved. For instance, a subdivision may demand that only 2-storey houses be built there. On the other hand, they may demand that the threshold for construction costs is Php 2.5 million and not less than that. Such restrictions are in place to ensure the quality and uniformity of houses built in the subdivision.
7. Ask whether the property is vatable or not.
You can ask the real estate broker in Baguio City if the amount of the house and lot is subject to Value Added Tax (VAT). That means when you purchase a house worth Php 5 million, 12% or Php 600,000 will be added on to it. That will be on top of additional money you’ll pay for transfer tax fees and documentary stamps. Make sure this is clear to you because you will need to factor that in when you calculate your budget. The same thing goes if you’re buying a condo in Baguio City.
Once you consider these seven things, you’ll know if you’re ready to be the next owner of a house and lot in the beautiful city of Baguio.
Article By: Sunshine Navarro
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