Understanding the real value of RFOs

Investing in a condominium unit has long been considered as one of the best sources of passive income.

Apart from the fact that you have a tangible asset, gains can be had in two ways—through rentals that will give you additional monthly income and through capital gains as prices of condominiums have been seen to appreciate over time.

But the question many ask is: do I buy the pre-selling or ready-for-occupancy (RFO) units? There are equally compelling merits to both options, but if you want to immediately enjoy the benefits of your condo investment—whether as an end-user or as an investor—RFOs would be the way to go.

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Based on estimates of Colliers Philippines, there are some 14,879 condo units classified as RFOs out of the 42,511 remaining inventory in Metro Manila as of end 2020. While there a number of options in the market, the key is to choose which of these units can offer you a strategic location near essential establishments, a well built structure, exceptional finishes as well as choice amenities that can provide you or your lessee with a healthy, relaxing environment.

A smart choice will allow you to reap the gains and benefits offered by the Philippine real estate industry, which managed to remain resilient amid the pandemic.

Data from the Bangko Sentral ng Pilipinas showed that the nationwide residential property prices recovered in the fourth quarter of 2020, as based on its Residential Real Estate Price Index. It reported that house price growth reverted to the positive territory as RREPI rose by 0.8 percent year-on-year, and by 2.4 percent quarter-on-quarter.

Global Property Guide also reported that the estimated rental yield for a 120-sqm residential space in Metro Manila, with a buying price of P23.5 million and a monthly rental rate of P120,131 stood at 6.13 percent in 2020, despite the challenges of the pandemic.

Colliers meanwhile believes that recovery is in the offing.

“Starting 2022, the pace of growth for condominium prices and rents is expected to reach 1.5 percent and 1.7 percent, respectively, due to the government’s vaccine roll out and a rebound in office space absorption. Prior to the pandemic, the average growth of prices from 2015 to 2019 reached 13.9 percent annually,” said Colliers in its April 2021 report.

Given the green shoots of recovery in the residential market, condominium investing today can be a lucrative option. It now boils down to the RFO you will choose.

Best to go for a seasoned developer like Federal Land, whose impressive portfolio of RFO units will give you sound choices, allowing you to reap the benefits of investing in real estate.

Federal Land’s One Wilson Square at the corner of Ortigas Ave. and ‍Wilson St. in Greenhills, San Juan offers spacious homes with unparalleled access to central business districts, prestigious schools, commercial complexes and recreational hubs. Its premium location is ideal for those on the go, befitting those leading a fast-paced cosmopolitan lifestyle.

Another option is The Capital ‍Towers along E. Rodriguez Sr. Ave. in Quezon City—a three-tower residence that addresses the must-haves of the modern urban dweller from safety and security measures; amenities; to proximity to essential goods and services, schools, leisure hubs, and other institutions. Its prime location presents convenient mobility options via major infrastructure developments such as the newly opened Skyway Stage 3.

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Investing in condominiums is indeed one of the best sources of passive income, but only if you find the right partner like Federal Land whose projects can give you your money’s worth.

With reports from Marielle Medina and Kathleen de Villa, Inquirer Research

To know more about the RFO properties, call One Wilson Square hotline at (632) 7906-5113, The Capital Towers hotline at (632) 3415-2500, or visit this website.

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Article and Photo originally posted by Inquirer last June 12, 2021 8:00am and written by Amy R. Remo.

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