Real estate business in the Philippines is on the rise, and you’ve finally decided to enter your condo unit into the local rental market. Congratulations! Now that you’re here, ask yourself this question: do you actually know what to do with your Philippine real estate opportunity today?
If your honest answer is a timid “no,” then don’t worry. There’s actually a lot that goes into renting out your space for the first time - and successfully at that.
It’s important to know exactly where you are on your lessor’s journey. By admitting that you don’t know much about renting out your space yet, you can do the research and prepare yourself for this upcoming journey for all your real estate needs.
This long and tedious process will be worth the risk when you know exactly what to consider before renting out your condo. Ready to embark on this journey with us at DMCI Homes Leasing today? Then keep on reading to learn more.
Is real estate investment in the Philippines worth it?
You probably asked yourself this question when you initially bought your property. Now that you’re thinking of entering your unit into the condo leasing market, it’s worth asking yourself again: is a real estate investment in the Philippines really worth it today?
To answer this all-important question, let’s look at the facts.
Even amidst the COVID-19 pandemic, real estate was still a practical investment. It offered owners many predictable cash flow opportunities, a lot of equity buildup, and better appreciation in value over time.
As a long-term investment, real estate is also less risky than most. You can easily use your condo space as a personal home, or you can utilize it as a lucrative financial venture in today’s recovering housing market.
So if you’re wondering whether real estate investment in the Philippines is really worth it, then here’s your answer: yes, it really is. It can be tedious to invest time and money into entering today’s real estate business world, but the risks will be worth the reward when you land that perfect tenant and earn a lot from your property investment this year.
How to make your condo leasing stand out
Now that you know why real estate is worth the risk, you will want to ensure the success of your property as you begin renting it out. While there are a ton of considerations that you will need to go through first, here are some quick and easy tips to make sure your property stands out in today’s housing market:
- Upgrade the appliances. If you’re renting out a fully-furnished condo, this is an easy way to make your condo stand out. Upgrade old and broken appliances by replacing or repairing them to increase your property’s value.
- Add extra storage space. One of the challenges of the condo lifestyle is working with limited space. Attract potential residents by adding extra storage space in your kitchen, bedrooms, bathrooms, and living room.
- Update your security features. This is another easy way to increase your unit’s value and attract potential residents. Give them an air of safety by installing smart locks and CCTV systems for added security in their new home.
- Clear the clutter. No one wants to live in a messy home. Whether you’re taking photos of the property or showing it off to potential residents, you can quickly transform your condo make sure the space is spick and span for tenants to enjoy.
- Refresh the paint. Never underestimate the power of a new color wall. If your unit is relatively old and has worn-out paint, easily refresh its look by repainting the walls anew.
- Take better photos. How else will future tenants know what they’re getting if you don’t take better photos of your rental? Make your unit stand out with stunning photos and hook potential residents in today.
These tips aren’t the only things you should take into consideration when making your condo stand out though. Think you have what it takes to run a successful rental business in the Philippines today? Thoroughly prepare yourself for this huge undertaking by checking out these 15 considerations for your condo leasing this year.
15 considerations before doing rental business in the Philippines
Want to successfully rent out your real estate investment in the Philippines? Looking for ways to make your condo property shine on the market this year? Then take a look at the top 15 considerations you need to take as a landlord right now.
1. Are you ready?
The very first thing to ask yourself is this: are you ready to be a landlord?
It may sound easy to rent out your unit, at first. All you need to do is to dump all the responsibilities that living in the unit entails onto the new resident. But put yourself in the shoes of the tenant; you'd want the unit you’re renting to be ready for occupation, right?
As the lessor, it’s your responsibility to provide the basic necessities that a unit should have for your resident. Consider their needs and make your unit livable and enjoyable too. Once you have affirmed that you are ready for the task of being a landlord, you can then enroll your unit for lease and start looking for a tenant today.
2. Rules, rules, rules
As a landlord, you have to be aware of the rules and regulations involved in renting out your unit. Talk to your condominium building management to learn more about the rules your tenants need to follow while living in your unit.
Remember that you’re legally responsible for a tenant's behavior. By familiarizing yourself with the building’s rules, you can take steps to ensure residents follow them as well. If a problem comes up with your tenant, you’ll have strong legal backing because you knew the rules and did your responsibilities as a lessor.
3. Government documents
Want to avoid documentation misunderstandings and stress with your future rental? Check with your condominium building management if you need to secure specific government documents for the condo lease first.
Do you need a permit? Are there any tax obligations you need to fulfill? Get this landlord’s checklist done first before you even think about renting out your condo unit to a potential tenant this year.
After you secure these government documents, then you can prepare your contract with future residents. This is where you list down the legal obligations between both parties to ensure a successful and smooth real estate business transaction.
4. Time for a makeover!
A condo unit makeover might seem like the most fun part of being a landlord, but refurbishing your property and making it over is not an easy task.
Your tenants are paying for a service, and they’re renting the unit knowing that it should be in tip-top shape. You have to make sure that everything in the property is safe for use. From electrical wiring and water fixtures, to bedroom furniture and kitchen appliances, you need to ensure that your unit is ready for occupancy as its landlord today.
The good news is that making over your unit ensures that you get the most out of your condo’s rental value. With a unit in tip-top shape, you can ask for a better price from tenants in the future.
5. Who ya gonna call?
Clear communication between landlords and tenants is key for a successful lease. But you need to set boundaries for specific work hours and responsibilities too. No landlord wants to get a call at 3AM just to hear a complaint about a leaky faucet or a burnt out light bulb. So if you’re going to put out your condo for lease, then this is where you will want to call in professional help.
Have the contact details of dedicated repair professionals lined up to help you handle the bulk of the maintenance. Unless you’re able to do the repairs yourself, one veteran landlord tip is to have a network of reliable electricians, plumbers, and property managers when the need arises for your future tenant.
6. Finding the One
Finding the right tenant for the unit is probably one of the hardest parts of this real estate business venture. So to lock down your options, ask yourself: who’s your target market? Who do you not want to have as a tenant? By bringing these considerations up and by talking to your condominium building management, you’ll have an easier time finding the One for your condo leasing today.
7. Extra! Extra! Read all about it!
The next thing you need to consider is how you’ll tell people about your condo for lease. You can do this by collaborating with property management professionals to get word out about your unit. They’ll answer your questions and guide you through promoting your property to the right tenants. They can also help you settle advertising points like rental price, amenities, location, and more.
8. Put it online
Want to promote your property? Put it online. With the help of a property management company, you can advertise your unit on free websites, online classifieds, and listings to notify tenants of your rental vacancy. With DMCI Homes Leasing Services, you can avail comprehensive leasing services too, from lessee prospecting to unit handling. Get in touch with us today to learn more.
9. The price is right
Channel your inner Goldilocks and find the right price for your unit. Charge it too low, you will lose money; charge it too high, no one will buy it. Researching about the market is crucial in this field. You want to put your unit in a competitive position where you will not lose profit but will still be at a reasonable price.
You should know what you’re up against, but be firm with the actual price that you need. Consider the amount of costs you had to pay for furnishing the unit as well as for the pay of the property manager, if you decide to hire one, and for all the work that you had to go through.
10. Money, money, money
In addition to settling your rental price, consider getting serious with the financial side of this rental business in the Philippines. You can do things like open a bank account solely for the purpose of managing the money you earn by renting out your condo. It’s a business, after all.
Be transparent with your money, and put together a bookkeeping and record-keeping system. Track and manage your income and expenses. By being a money-minded lessor, you’ll be able to grow your financial benefits and manage your investment effectively too.
11. Weeding them out
There will be a lot of potential tenants who will be interested in renting out your unit. But these people are different from each other and it is your job to pick the crème de la crème.
You have to be critical with this step as a lessor. Have a checklist of what you want in a renter, and always aim for perfection when looking for one. Be sure to do a thorough background check with your potential residents as well. Check with their bank accounts and previous landlords to see if the tenant can pay for monthly fees.
12. Let's talk about it?
Once you’ve chosen your tenant, you have to sit them down and really talk to them about all the rules, regulations, and stipulations in your contract. Communicate with them constantly so that they follow all of these rules and avoid eviction in the future.
Don’t forget to ease their worries too by assuring them of your availability for conversations about the condo unit. All these talks will help to nurture a good landlord-tenant relationship, which will ensure the success of your rental in the long run.
13. Call me, maybe
In line with the previous tip to nurture a good rental experience for your residents, make sure to double-check that your tenants have all the immediate contact information they need before they move into your property this year.
If they need help with repairs, for example, they should have the contact details of those dedicated maintenance people we mentioned earlier on this list. If they have questions about the property that fall under your jurisdiction, they should be able to contact you through your phone number right away - and you should be available to answer them during your agreed upon work hours too.
14. Don’t be a stranger
You're essentially inviting a stranger to live in your condo unit, so you’ll definitely want to build rapport with them from the very start. Don’t be a stranger to them throughout the duration of their lease. Talk to your tenants, be responsive, and encourage respectful communication between the two of you to ensure a peaceful lease for both parties.
15. And you're out!
While you want to avoid this worst case scenario, it’s important for you to discuss possible reasons for eviction with your tenant before they move in. Have them understand that you aren’t going to be lenient with them if they violate building management rules. As long as you have reasonable cause to do so, don’t hesitate to evict residents if they do you wrong during their lease.
Final tips for real estate aspirants
If the gravity of renting out a condo is finally hitting you, don’t worry. Yes, it can be a lot, but keep in mind that the pros of real estate success far outweigh the cons of this industry’s tedious nature.
As long as you do your research and prepare for the journey ahead, you’ll reap the financial rewards of starting a rental business in the Philippines today. Partner with experts in the condo leasing industry, and you’ll gain even greater wins with your real estate investment in the Philippines this year.
While there will always be risks involved in any real estate business venture, you can take precautionary measures to ensure a great experience for you and your tenants today. With the right amount of preparation, you can become a successful landlord; just keep these key takeaways in mind as you start your lessor’s journey this year.
- Do the research. There are a lot of financial and legal considerations that go into leasing your unit. Take your time and do the research to cover all your bases before you start a rental business in the Philippines.
- Get expert help. Don’t be afraid to ask for help from your building management and designated property manager when setting up your home for leasing, either.
- Communicate clearly with your tenants. From contract negotiation to lease termination, make sure to clearly communicate all the rules, regulations, and stipulations with your residents for a smooth condo leasing experience for both parties.