Are you afraid of being in your 30s? You shouldn’t be. It sounds clichéd, but the best is yet to come. You can always consider this phase an upgrade because you’ve become wiser, bolder, and more grounded.
Plus, your 30s offers a lot of exciting achievements waiting to be unlocked, such as home ownership. If you’re planning on buying a house at 30, we’ve created a comprehensive guide to help you out.
Is the 30s a Good Age to Buy a House?
Whether you're a millennial looking to move out of your parents' home or a young Gen Z-er planning as early as now to buy a house in your 30s, it’s never too late! Buying a house at 30 is actually the best age to buy a house. Here's why:
✔️ You’re Financially Wiser
Gone are the days when YOLO was your ultimate mantra. You’ve stopped burning cash on lifestyle luxuries that prove your upward social mobility. Instead of buying handcrafted coffees every day or updating your phone every time there’s a new release, you’ve also started building your wealth through investing, freelancing, or running a business on the side.
Buying a house at 30 just makes sense because you’ve likely already taken care of major debts, thus giving you a clean slate. Because you’re financially wiser, you’ve probably already saved money for your home’s down payment.
✔️ You’ve Built a Good Credit History
Unless you can pay your property in cash, you’ll need to apply for a housing loan. Banks and lending companies, however, check their applicants’ credit scores. Your credit score is important since it represents your trustworthiness and capability to pay back.
Most people in their 20s haven’t sorted out their financial priorities yet, which explains why many of them have a lot of debt. Debts can affect your credit score, affecting your loan application’s odds of success.
This is why buying a house at 30 is your best bet. There’s a great chance that you’ve settled the majority of your financial obligations and improved your credit history, which means you have better odds of scoring a favorable loan offer.
✔️ You Can Afford Higher Monthly Payments
One possible downside of getting a home in your younger years is that you may be forced to go for a longer loan term since this means lower monthly payments. Moreover, this may be the only tenor your salary can afford. Ultimately, with a long loan term, you'll pay the interest for longer.
But if you're buying a house at 30, you may find yourself with a higher salary. You can now afford shorter mortgage terms, such as 10, 15, or 20 years. The monthly payments may be higher, but they’ll keep you from paying a large sum of interest.
✔️ Your Career is Already Established
Being in your 30s may mean that you’ve already found a job or career that you’ll stick to in the years to come. Job security is important when it comes to homeownership for two reasons.
One, banks and lending firms want to see that you have a steady flow of income. Second, home ownership doesn’t just end with down payments and monthly mortgages. You have to take the insurance, utilities, renovations, and unexpected home expenses into account.
You can pay for these expenditures only if you have a stable job that pays well.
✔️ You’ve Already Decided Where to Live
After years of moving from one apartment to the next, you already have an idea of what your permanent address while living in the Philippines should look like. You’ve already taken into account your future plans, such as starting a family or retiring in a peaceful community far from the metro’s hustle and bustle.
If you’re an enterprising individual, you might have even considered your potential home as an investment asset to rent out for extra cash or even to resell.
Read more: Planning to Buy a House in the Philippines? 9 Signs You’re Ready
Buying a House at 30: 7 Steps to Owning Your Dream Home
Buying a house for sale in the Philippines is not an easy feat. It’s multi-layered, and it requires you to speak to different agencies and people. As such, proper coordination and organizational skills are a must.
To make the entire process efficient, here are some things you need to keep in mind.
1. Decide on Your Home-Buying Budget
Buying your first home in the Philippines? Many first-time homebuyers immediately start shopping for properties without setting a budget first. Avoid this common mistake because it’ll tempt you to spend your money on something you can’t afford.
It’s easy to fall in love with a stylish house with a breathtaking view. But what if it turns out to be expensive? So that your home purchase decision won’t be driven by emotion, determine a budget for buying your first house.
How much can you really afford to buy a home? The rule of thumb is to follow the 30/30/3 rule for home buying: spend no more than 30% of your monthly salary on home loan repayments, save at least 30% of the home's value in cash, and buy a home worth no more than three times your annual income.[1]
This way, you can avoid overextending your budget. By setting aside the cash, you also have a bit of a financial cushion in case of emergencies.
But this is just one way to estimate how much you can spend on a home. Your budget should still be based on your own financial situation. You can also use an online calculator, one that computes how much you can borrow from lenders to buy a home based on your income.
Think long-term, too. Don’t overestimate your financial capacity to buy a home. You may be earning well in the present, but your employment status may change in the future. Be a bit conservative when estimating your home-buying budget.
2. Get Pre-Qualified for a Mortgage
Aside from knowing how much you can afford, it’s equally important to find out how much banks are willing to lend you.
What you think you can afford won’t necessarily match what lenders think you can afford. This is because banks look at different factors, such as credit score and employment history, to evaluate a borrower’s ability to repay a home loan.
This is why you should never skip the pre-qualification process in your home-buying journey. Getting pre-qualified lets you know how much you can borrow to buy a home and which banks you’re qualified to borrow from.
Traditional pre-qualification follows a rather rigorous process. You’ll go to each lender, submit your personal and financial information (salary, occupation, employers, sources of income, etc.) for review, and wait for the entire process to be completed.
3. Save Up for a Down Payment
Once you know how much you can afford and how much you can actually spend on a new home, the next thing you must prepare for is the down payment.
A down payment is an amount—specifically, a percentage of the property value—that home buyers pay out of pocket to buy a home. Wondering how much you'll need to shell out for a downpayment for a house in the Philippines? It’s typically at least 20% of the purchase price. The remaining balance can be paid over a certain period through a home loan.
Buying a condo unit worth ₱1.5 million, for instance, will have you shelling out at least ₱300,000 in down payment. Not everyone can pay such a huge amount upfront.
So how to afford a house in the Philippines? Start saving for your down payment as early as possible. It takes discipline, hard work, perseverance, and negotiation skills to overcome this challenge.
Even if you know how to buy a house in the Philippines, you still need to prove to lenders that you’re financially capable. You can do this by saving enough to cover the down payment upfront. This should motivate you to keep going until you hit your savings goal.
Here are a few tips to effectively save money for your down payment on a home:
- Set aside a fixed amount (from your salary, bonuses, 13th-month pay, and other income sources) specifically for your home purchase savings. To make this much easier for you, automate your savings.
- Find additional income sources (e.g., freelancing jobs, low-capital small business, etc.) if your paycheck isn’t enough to save for a down payment.
- Have a separate savings account for your down payment fund. Ideally, open a high-interest bank account with a passbook and no ATM card, so you can’t easily withdraw the money for other expenses.
- Prioritize your crucial expenses and let go of frivolous spending.
- Negotiate with the developer or bank so you can make down payments in monthly installments for one to two years instead of a larger one-time payment.
4. List Down Your Must-Haves
Before you start visiting houses for sale in the Philippines, make a checklist of what you want in a home. This will help you narrow down your options and make your search for the perfect home a lot faster.
Consider the following important factors:
- Location – Is the neighborhood safe? Is it close to public transport, hospitals, schools, and commercial establishments? You may think that the city is the best location for a home because of its convenience. But if you scope the suburbs of nearby provinces, you may find an address that’s ideal for your lifestyle and future goals.
- Amenities – What amenities are important to you? Swimming pool? Gym? Basketball court? Children’s playground?
- Property type – Are you looking for an apartment, condo, or house and lot, or other house types?
- Property size – What’s your preferred number of bedrooms and bathrooms, floor area, and land size? Do you want a big garden? Are you planning to have at least three cars in the garage?
- Property status – Are you willing to buy an RFO (ready for occupancy), pre-selling,[2] or foreclosed property? Have you considered rent-to-own homes? Remember that a property’s price is also based on its status. For one, RFOs are more expensive than pre-selling properties. Foreclosed properties can also come cheap, depending on their physical condition.
- Real estate developer – Does the developer have a good track record of building high-quality projects and completing them on time? Is it a reputable company? Read reviews and testimonials, or ask your family and friends who own property built by your prospective developer.
5. Shop for Homes
Search for properties with features you want and prices within your price range. You can browse homes online through real estate developers and property listing websites.
You may choose to shop around on your own. Or better yet, get a PRC-licensed real estate agent or broker to help you find homes for sale and guide you through the entire home-buying process.
6. Visit Possible Properties to Buy
List down the properties you’re considering and schedule a visit with your agent to personally view each home. Contact the seller or developer and arrange for an ocular visit.
Open houses are a great opportunity to inspect your potential home and see your developer’s quality of work. And since you’re inside the actual home, you can easily envision the future look of your space based on your aesthetic taste and plans.
This step may take time, especially if you’re always busy. But don’t rush it—take as much time as you need to make sure you choose the right home to buy.
Here are some things you may want to bring up to your agent during open houses:
- In case you’re planning to buy a “secondhand” or old property, ask your agent why it’s for sale. Doing this may reveal some pitfalls or red flags. While you’re at it, ask how long the house has been on the market.
- If you’re buying a new home and you’re visiting a model house, ask the agent if you can visit other finished homes within the village. That way, you’ll be able to see if the quality of work is consistent.
- Ask your agent if you can apply some upgrades or modifications to the new home after you buy it.
- If you’re buying a pre-selling home, ask about the timeline of the construction and the expected date of turnover.
- Whether you’re buying a pre-selling or an old home, ask if there is a homeowner’s association. If there is, expect that there’ll be additional fees that you’ll need to cover.
7. Get a Home Loan
Found a home that meets all your requirements? Great! The next step is to secure a loan for financing your home purchase.
You can apply for a Pag-IBIG housing loan if you’re looking for a longer term and lower interest rates. Check out in-house financing, or the loan facilitated by the property developer, as well.
Intimidated by the idea of applying for a housing loan from a bank? After all, there’s a sea of banks out there with an assortment of offers. On top of that, you need to take care of a long list of documentary requirements.
Enjoy an Easy Application Process with a Security Bank Home Loan
However, with a Security Bank Home Loan, you can now apply with ease—just head to the Security Bank website[3] to proceed with your application. It's one of the best options out there, even winning the Product of the Year Award at the Asian Banking and Finance’s Wholesale and Retail Banking Awards in 2019.[4]
Take a look at its features:
- Flexible loan terms - Enjoy repayment terms of up to 25 years. Pay for a maximum of 15 years for a residential vacant lot or condominium unit, a maximum of 20 years for a townhouse or duplex, and a maximum of 25 years for a house and lot.
- Fixed, low interest rates - Enjoy one of the lowest interest rates in the market, starting at 7% for one year, 7.25% for three years, and 7.75% for five years.
- High loan amount - Borrow up to 80% of the property’s appraised value. Loan amounts range from ₱1 million to ₱10 million.
- All-In Financing option - Worried about bank fees? With the All-In Financing feature, you can include bank fees and charges as part of your loanable amount. This means you won't have to pay them immediately—just pay them together with your monthly payments throughout the loan term.
To apply for a Security Bank Home Loan, you just need to meet the following eligibility requirements:
- At least 21 years old (but not over 65 years old upon loan maturity)
- With a minimum monthly income of ₱50,000 (combined amount for joint borrowers)
- Employed for at least two years
- If self-employed, must be operating a legitimate and profitable business for the last three years
You also need to submit the following requirements. For the full list, visit Security Bank's website:[5]
- Duly accomplished Security Bank Home Loan Online Application Form[6]
- Clear copy of one valid government-issued ID of the borrower, spouse, co-borrower, or loan signatories
- Any of the following proof of income:
- Latest Certificate of Employment and Compensation
- Latest Income Tax Return
- Latest bank statements
- Mortgage Redemption Insurance (MRI) Application Form
- Relevant collateral documents
- Special Power of Attorney (SPA)
- Accomplished Authorization Letter for Property Collateral Verification and Tax Mapping
- Check the Security Bank website for the full list of document requirements, including those for self-employed, OFWs, and corporate borrowers.
Read more: How to Get Approved for a Housing Loan: 10 Tips for Home Buyers
Final Thoughts
Your 30s is one of the best decades of your life. You’re wiser, for one thing. And since you enjoy a significant increase in financial freedom, you can afford to be adventurous when it comes to big purchases, too. As such, buying a house at 30 is something you should look forward to.
DISCLAIMER: This article was created in partnership with Security Bank Corporation. While we are financially compensated for this collaboration, we ensure to maintain our editorial integrity to provide you with the best recommendations that can help you make smarter financial decisions.
Sources:
- [1] If you're an aspiring homeowner, use the 30/30/3 rule to figure out what kind of house you can afford (Business Insider, 2020)
- [2] Property of the Week: Pre-Selling vs RFO (Real Living, 2014)
- [3] Security Bank Home Loan
- [4] Security Bank Home Loan Wins Product of the Year Award
- [5] What Are the Required Documents?
- [6] Security Bank Home Loan Online Application
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