It takes seven-digit money and years to fully own yourself a property. Therefore, buying a property is not a small decision; it involves many concerns such as location, mortgage, and our financial ability to finish paying off the loan. In summary, these are the main points that you need to consider before buying a property.
Location is the first priority you should concern. Is transportation convenient? Is it close to any public transit? How close is it to the community area? A good location will affect your life positively, and benefit you when resell the property in the future.
Property in a good location will have its price adjusted higher than the average when there’s strong demand in the market. Property in a good location also has a greater chance of resale or finding a tenant if you decide to rent out.
Not withstanding that, choosing location also needs to be in line with your personal taste and true goal of living there. If you dream of a peaceful tranquil open-space neighborhood, then looking for a property in suburbs would be more ideal than properties in the central city.
Meanwhile, if your concern is to live somewhere convenient in reaching your workplace or aspire city-life style, then properties in the city would be preferable.
Nowadays it becomes easier to own a property. You need to pay down payment which is around 20% of the property price, and the rest will be paid periodically through a mortgage. In the meantime, you can live in the property, but the ownership will be granted to you only if the loan is paid off.
To give an example, assume you decide to buy a house priced THB 1 million; you borrow a mortgage with the term 30-years, and need to pay THB 7,000 per month. In this case, your salary should be at least THB 23,000.
In other words, your monthly installment shouldn’t exceed 30% of your salary. In any circumstance, banks do not lend a mortgage easily; they need to check your financial statement, past records, and all types of debts you might be owing to some parties.
If you happen to be repaying other loan in the meantime, such as personal loan, then there’s a chance for bank to reject your application for the mortgage.
The higher salary you earn, the more credit line you could borrow from the bank. However, it is better to borrow a small amount as possible, because of the higher the amount you borrow, the higher interest rate you need to pay.
If possible, pay more on the down payment, then the task to finish off paying off your mortgage will be much easier. Don’t fall for a promotion where banks provide high-credit line loans; assess your financial ability first. Perhaps, collect more money for the down payment until you’re confident to start paying a mortgage in the long-term and eventually own property yourself.
Besides the mortgage that you need to pay, living in property also comes with other expenses such as maintenance fees, insurance fees, and utility bills. Whether you live in a condominium or a housing project, the maintenance fees must be collected monthly or yearly by the juristic person.
The maintenance fee is used to repair and maintain the facilities of the project, including salaries that they need to hire janitors and security guards.
Another expense is the budget for furnishing and refurbishment. If the property comes in the form of fully-furnished, then there will be no expense in this area. However, most properties are sold in a fully-fitted feature, providing only basic furniture and appliances.
Products such as washing machines, mattresses, and cooking appliances and utensils are not likely to be provided. Even if the property is already fully-furnished, you will be certainly buying new furniture from time to time. Therefore, this is another expense you need to consider, and it can cost up to THB 100,000.
In conclusion, these are the 3 main points you need to consider before buying a property. Always put reasoning before desires and visualize which property is suitable for you, and how you would own it while exercising your finance in a healthy way.
You can try DDproperty’s mortgage calculator to figure out how much you can afford, how much you should borrow, and more.
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