Millions of Filipinos love living in the moment. Although this is a great disposition in life, it poses a massive risk for their future. Filipinos work hard to sustain their daily living expenses.
However, only a few people invest their hard-earned money to prepare for their future. In fact, in 2017, among the 100 million people in the country,only 7.4 million Filipinosinvested in life insurance and other financial plans.
This shows how people still don’t have any idea about the importance of spending money to have additional income or stable cash flow when they reach the retirement age.
If you are one of those who want to start investing but don’t know where to start, you are not alone. If you are looking for an additional source of income, consider buying a residential property. You can convert it into a rental unit where you can get a stable source of income for years.
Prices of Residential Units
You need a huge capital if you plan to start a business in the rental property industry in the Philippines. You will need about 7.5 million pesos to own a property in a popular tourist destination, such as Tagaytay or Baguio City.
If you buy a prime-located unit such as a condominium property in Ortigas, Makati or BGC, you need to prepare an average of Ã¢Â±142,576.00 to Ã¢Â±213,929.10 per square meter.
So, if you will be buying a 50-square-meter unit, you need to have over 7 million pesos. You might think that this is ridiculously expensive. However, you don’t have to pay the entire cost in cold cash.
Existing unit developers offer installment options in the country. You only need to find the best way to secure your finances. The best option to finance a residential unit purchase is via housing loans offered by banks or the government via the Pag-IBIG housing loan.
You can ask your real estate agent to help you decide depending on your budget, the price of the property, and the payment terms.
How Much Rental Properties Make in the Philippines
Purchasing a residential unit can be quite expensive, but if you are converting it into an income-generating resource, it can secure your future. Condominium units can be rented up to 1,135 pesos per square meter monthly so if you own a rental property with 50 sq.meters, you can expect an income of more or less 56,000 pesos every month.
According to a study, properties located in prime locations such as Ortigas, Makati, Eastwood and Global City can provide owners with a 7.5% return of investment.
If you enlist your property online, such as Facebook Marketplace, Airbnb, you can gain more exposure and attract more people to rent out your unit. You can also invest in a few renovation or remodeling projects to improve the appearance of your unit.
Offer features such as unlimited WiFi, complete kitchen tools, or gaming devices if you want to target short-term rental offers. People would want to rent your property to feel at home while away from home. So, you need to invest in transforming your unit into a place where anyone can call their own temporarily.
Starting a rental property business requires a huge investment from those who want to succeed in this industry. But if you work hard to make it an official asset, you can earn a lot more than what you are currently making.
You will also have the opportunity to experience a steady cash flow without the need to monitor your investment every single day. You only need some maintenance and improvements and you’re good to go.
Are you thinking about starting a rental property business in the Philippines?