HOW TO AFFORD A METRO MANILA CONDO

Lamudi looks at the salary you need in order to afford a Metro Manila Condo

              MANILA, MARCH 12, 2015: For a couple earning a combined income of Php125,000 per month who are looking to buy a 60-sqm condo in Metro Manila, they should consider Mandaluyong, San Juan, Pasig, Parañaque, Muntinlupa, or Las Piñas for properties as these cities offer condos within their budget. On the other hand, people looking into buying a condo in Makati or Taguig should have a monthly income of Php178,000 and up.

These were some of the findings of Lamudi Philippines’ analysis on the average per-sqm price of condos in Metro Manila. The global online real estate marketplace determined how much gross monthly income should a prospective condo buyer have in order to afford mortgage payment of condos, using 6.5 percent annual interest rate fixed for five years and a loan tenor of 15 years.

In addition, Lamudi’s calculation assumes that the buyer spends not more than 30 percent of their gross monthly income on mortgage repayments (including principal and interest) and makes a 20 percent down payment on the property, following most banks’ 80/20 loan-to-value ratio.

Metro-wide, a prospective condo buyer who sets aside a 20 percent down payment for a property needs to have a salary of Php128,323 per month in order to afford a 60-sqm condo (which is a mid-end two-bedroom unit), using the Philippine capital’s average condo price of Php90,633 per sqm. However, when looked at individually, the cities of Metro Manila show great diversity.

For example, a condo buyer who plans to buy in Makati should have a monthly gross salary of Php196,820—the highest anywhere in Metro Manila. In contrast, those who plan to purchase a similar unit in Las Piñas—Metro Manila’s cheapest city to buy a condo—should be earning approximately Php70,580 per month. Using the latter’s average condo price of Php49,849, a 60-sqm unit would cost approximately Php2.99 million.

Buyers looking to buy a comparable condo unit in Taguig, Pasay, Quezon City, and Manila should be earning more or less Php178,580, Php148,220, Php143,393, and Php134,696, respectively. Furthermore, those who are looking at Mandaluyong, San Juan, Pasig, Parañaque, and Muntinlupa for their future condo investments should be making about Php124,840, Php123,596, Php113,733, Php91,006, Php86,090, and Php70,580, respectively.

However, the data gleaned from Lamudi’s analysis is just an estimate. Real property taxes and insurance costs will vary depending on the location and type of property, not to mention that buyers do not have uniform lifestyle and spending habits.

Furthermore, some people have more savings than others, allowing them to put a larger down payment, which saves them thousands on interest payments every month. These people can also save on mortgage insurance as having a large equity on a property makes them financially attractive to lenders.

Nonetheless, the analysis gives potential condo buyers an idea of how the associated costs of purchasing a condo property differ between the cities of Metro Manila, and how much monthly salary should they aspire for in order to afford that condo of their dreams.

No data was generated for Marikina, Valenzuela, Pateros, Malabon, Caloocan, and Navotas due to lack of condo listings in these cities.

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