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foreverlost

Condo adjacent to Ayala Mall

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foreverlost

Hi,

When we were in Cebu a couple of years ago (early 2017 I think) there was an office in Ayala that was marketing condos for sale in a building that was being built next to Ayala Mall. I think there may have even been a walkway into the mall planned but I don't recall for sure (maybe I'm imagining that part).

 

Does anyone know if those are still for sale as new builds or have they sold out?

 

Also if we buy a condo new, what % of the mortgage payment (very roughly - approximately) could be covered by renting it out to a long term tenant or by airbnb? If renting by airbnb is there a good way to handle management of the property (tenant checkouts including a check for property damage, cleaning, etc)?

 

Any other thoughts around this topic? We were thinking of buying a condo to live in starting around 2023 and renting it out until then. I like the idea of a condo more than a house since as a U.S. citizen I can actually own it - unlike a house. I guess we'd try for something around 2 bedrooms and 1000 sq feet (approximately) - not sure how that translates to square meters.

 

Thank you

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Dafey
18 minutes ago, foreverlost said:

if we buy a condo new, what % of the mortgage payment (very roughly - approximately) could be covered by renting it out

There are a lot of determining factors...how big a Mortgage, (monthly payment), being the primary.

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savarity

I know that building is open now and tourists with luggage pass through the 4th floor of Ayala to access it.

They are building another beside it too.

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smokey

100 sq.meters next to ayala humm hold on to your wallet 

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Mikal
22 hours ago, foreverlost said:

Hi,

When we were in Cebu a couple of years ago (early 2017 I think) there was an office in Ayala that was marketing condos for sale in a building that was being built next to Ayala Mall. I think there may have even been a walkway into the mall planned but I don't recall for sure (maybe I'm imagining that part).

 

Does anyone know if those are still for sale as new builds or have they sold out?

 

Also if we buy a condo new, what % of the mortgage payment (very roughly - approximately) could be covered by renting it out to a long term tenant or by airbnb? If renting by airbnb is there a good way to handle management of the property (tenant checkouts including a check for property damage, cleaning, etc)?

 

Any other thoughts around this topic? We were thinking of buying a condo to live in starting around 2023 and renting it out until then. I like the idea of a condo more than a house since as a U.S. citizen I can actually own it - unlike a house. I guess we'd try for something around 2 bedrooms and 1000 sq feet (approximately) - not sure how that translates to square meters.

 

Thank you

You must be thinking of 'Park Point' - they have an entrance to Ayala, next to S&R, from their courtyard / swimming pool area.  As well as elevator access directly into Rustans.

We looked at a couple of new units in that building a bit more than 1-year ago, so they still had units that they'd never sold at that point in time, but since then I believe they may have sold out.  A bit pricey of course, I'd be surprised if you could cover a mortgage and the monthly association fees etc. renting it out.  I don't remember the specifics, but I do remember that they include a membership in the City Sports Club (across and down the street half a block) in your dues.  No choice, want it or not, you're a member and paying for it.

It's Ayala Land Premier, so it relatively good materials and workmanship.

'The Alcoves' is Ayala Land Premier's latest Ayala Center project.  Still under construction, another step up in prices, it's also directly connected to the mall.  I can't recall the specific connection points, the Metro fire could changed that anyway.  I do remember the 4 top floor, corner units were priced at about 1-million USD.

So I think the Alcoves will be the new high point for condo prices in Cebu.  I think '1016 Residences' (another Ayala Land Premier building, but NOT attached to the mall) is likely the priciest currently.

I don't think it's going to be easy to cover a monthly nut that includes a mortgage in any of those buildings.  You should do a lot of homework to figure out what those units are actually renting for (long-term), whether or not you're even allowed to AirBnB in the building, what sort of occupancy rates others are getting with AirBnB, etc.  In my mind there are much better values in that area, but everyone's perspective is different.

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TimL

Solenea is next door to Ayala. Building 2 has one side that overlooks the Rustins side of Ayala. I checked some 2 bedroom units out a few weeks ago. Nice units, full ovens, ranges and front loader washers in the 4 units that I looked at but, with building 3 being built, it’s a bit too noisy for my tastes. 2bedroom rentals are in the 60-80K range depending upon floor and how motivated they are to rent. No clue what the purchase prices are. 

 

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Davaoeno
On 1/29/2019 at 8:59 AM, foreverlost said:

Also if we buy a condo new, what % of the mortgage payment (very roughly - approximately) could be covered by renting it

Assuming you want to pay as little interest as possible you should probably pay 50% down and finance the rest . Make sure you take the longest term that the bank offers .  I think that you should be able to get away with not making any payments at all . 

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foreverlost

Thanks for the replies.

 

Mikal what do you think are much better values? And what are your thoughts on buying a re-sale condo vs a new condo?

How does financing work generally speaking? Is it high interest or reasonable rates? How long is the term? I know US mortgage rates are hard or impossible to find anywhere else in the world (4-5% fixed over 30 years with 3.5% down).

We are traveling there in a few months, where is the Solenea sales office?

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Davaoeno
15 hours ago, TimL said:

with building 3 being built, it’s a bit too noisy for my tastes

he said he wont be living there for about 4 years !! 

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Cgu

Bad timing for mortgage...interest rate are very high at the moment. So fixing it for long term is a good idea if timing is right. Not at the moment 

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Mikal
9 hours ago, foreverlost said:

Thanks for the replies.

 

Mikal what do you think are much better values? And what are your thoughts on buying a re-sale condo vs a new condo?

How does financing work generally speaking? Is it high interest or reasonable rates? How long is the term? I know US mortgage rates are hard or impossible to find anywhere else in the world (4-5% fixed over 30 years with 3.5% down).

We are traveling there in a few months, where is the Solenea sales office?

Well everyone has a different perspective, different requirements, different likes and dislikes.

One of my personal likes is an 'older' building that has more spacious units, good management and a stable population.  A LOT of the condos in the CBD are owned by folks that don't live in the units, so there's never going to be as much stability as I'd like to see from that perspective, but there are some that are more geared towards long-term rentals versus the 'Condotels'.

But of course, buildings tend to 'age' pretty quickly in Phils, maintenance standards tend to be different, the building amenities may be sparse compared to newer buildings, and a lot of units in many 'older' buildings have already lost their 'views' to new construction.

But the way I look at it, I'd rather spend half as much for a penthouse unit in Avalon (across the street from the mall, next to Solinea) versus a new penthouse in The Alcoves.  Even though Avalon has now been up and running for what?  8 or maybe even more years?  And went through a transition from one developer to another during construction.  And has historically seen a lot of AirBnB action.  The building has been pretty well run and maintained.

And then again, I might have an even stronger preference to pay half again as much as in Avalon and buy a penthouse unit in Park Tower One.  Older again, I think it was the first Condo tower to open in the CBD, and it's a 5-minute walk to the mall.  Well managed and maintained - surprisingly well maintained in many respects for a, what?  13 or so year old building.  But reasonably stable population, lots of open space around it (although there is a plan to build a 2-storey commercial building in the middle of that open space in the middle of that loop and a couple of the open parcels in that area are now under development).

Neither of those towers have the amenities that Park Point has or that The Alcoves are supposed to have.  But to me that's fine.  Even from a short-term rental perspective I think being able to show a picture of a pool may the most critical factor.

You probably do want to be thinking about 'population stability' given that you're planning on actually living there.  Again, you don't get a lot of that in the CBD, but some buildings disallow short-term, AirBnB type rentals.  If you're going to 'invest' in a building you may want to have others living in that building that have some sort of stake in the building.  Maybe not constantly be seeing different people in the building, at the pool, etc.  People that may be, well, different.

Resale versus new?  Which one is the better overall deal?  New you might get to choose your finishes or even have it finished yourself, but resale you can always gut it and refinish as you like.  But remember. it is real estate, there are some differences but those are primarily in the  financing and the metrics, not the fundamental measurements.  In other words, if you finish a unit to a 'Gold Standard' in an otherwise mediocre building then, *shrug*.  Unless you will live there and enjoy those finishes forever (like THAT ever happens).

Mortgages?  I'm sort of past that point in my life, some others may have some good information.  I do know that you may have a bit of challenge getting mortgage from a Phils bank unless you have the right type of Visa and can show residency in The Philippines.  Shorter-terms are typical.  I have seen at least one instance someone managed to get themselves into trouble using builder financing when buying a new unit.  'Yes, yes, yes we will finance you for x-months (think about 3-years is common), after that you get a loan from a bank for the remaining (call it 50%).  Time comes to get the bank loan, and no bank would approve him.  

BTW, Solinea's developer is one of Ayala Land's mid-range developers.  So you tend to get smaller, rectangular or square boxes, not so solid construction and finish materials that some might not consider 'high quality'.

They also have Sedona on the Leyte loop.  I do recall Sedona instituting some restrictions on short-term, AirBnB type rentals a couple of years ago.  Not sure how that ever turned out.  Calyx has been marketed at times as a 'Condotel', but I'm not sure if they actually offer to market and manage your unit for you (which to me is part of really being a condotel).

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foreverlost

Thanks Mikal - that's some good info. We don't really need views as neither of us has a high opinion of Cebu building safety codes and would rather be on a low low floor with no view than on a high floor and risk dying in a fire because we can't get out. Also this may be a stupid question but are there concerns about buildings actually collapsing as they age? Does that sort of thing ever happen or is it safe to say the basic stability of the building itself shouldn't be a concern?

 

How do you sort of know what level of developer and construction quality you are looking at? You mentioned solinea being mid-range ayala land for example. I think that's ok for us but I'm curious how we can sort of rank builder quality.

 

I guess that correctly assessing population stability in a building would be a tough thing to do for us. Any tips for this?

 

Overall I like the idea of getting more room for our money. But I've heard that resale prices are often too high for condos - maybe I heard wrong and there are good deals to be had? (I know there are always occasional good deals in any market - but I mean that good deals are fairly common?).

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Davaoeno

One of the first condo units built in Cebu was Winland Towers . I think the first tower was built about 1985??? Go and inspect it . You won't see any cracks from all the earthquakes since then . Where did you get the impression  that you should be worried about buildings collapsing?

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savarity

They had to redo the balconies at my condo, not too far from Ayala, because there were so many cracks. The place only opened 3 years ago. There's even a memo that was in the elevators that structural repairs are out of warranty now so it will be up to the property owners to make repairs going forward.

Tiles pop up in the hallways every now and again.

Watching some of the other buildings being built nearby, there's no way some of those materials would pass building inspections in other nations.

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Mikal
8 hours ago, foreverlost said:

Thanks Mikal - that's some good info. We don't really need views as neither of us has a high opinion of Cebu building safety codes and would rather be on a low low floor with no view than on a high floor and risk dying in a fire because we can't get out. Also this may be a stupid question but are there concerns about buildings actually collapsing as they age? Does that sort of thing ever happen or is it safe to say the basic stability of the building itself shouldn't be a concern?

 

How do you sort of know what level of developer and construction quality you are looking at? You mentioned solinea being mid-range ayala land for example. I think that's ok for us but I'm curious how we can sort of rank builder quality.

 

I guess that correctly assessing population stability in a building would be a tough thing to do for us. Any tips for this?

 

Overall I like the idea of getting more room for our money. But I've heard that resale prices are often too high for condos - maybe I heard wrong and there are good deals to be had? (I know there are always occasional good deals in any market - but I mean that good deals are fairly common?).

I didn't mean to imply that the buildings might be structurally unsound, at least not to the point of collapsing any quicker than others.  And not sure I'm a big fan of being on the bottom of a collapsing tower...  haha, 'six of one, half a dozen of the other' I suppose.  Although I'd definitely agree that being on a low floor is MUCH more appealing in the event of a fire - I actually gave some thought to buying some rope and rappelling gear or similar at one point in time.  Seriously.  Having multiple exits, on multiple floors from the unit itself could help in some situations, but most likely might not help.

But being up top definitely helps in at least one aspect - water leaks.  Particularly when the building starts to get older you start to see more water issues.  Even on the top floor you can get water damage, through the wall, from an adjacent unit.  But at least you don't get water running down/into your walls and ceilings from above.  But that sort of goes back to the initial build quality as well.

Well different developers have different reputations, and different developers target different market segments.  The Ayala Land companies are pretty clearly divided based on the market segment they are targeting - 'premium', 'mid-range', 'can't recall the nice term for the low-end segment'.  The pricing will always be a giveaway of course.  You do want to understand the market segment that you're targeting also - they have different growth / appreciation rates and you want to try and compare apples to apples.  

Colliers International has a decent number of publicly available reports on the Philippines residential housing market.  I can't recall if I had to jump through any hoops to access any of them, but I have managed to get access to many of them.  Certainly makes for a dry read, but they'll give you both insight on the current trends as well as which developers are involved in which market segments.

As far as assessing the population stability, you can try to see how many units in particular building are currently advertised for rent, and how many are listed for long-term versus short-term rent.  If you have some buildings in mind then you can start with the listings on the Internet although they'll most likely be incomplete.  The best way to know what's actually available in the 'older' buildings is to walk in and ask.  For the AirBnB listings you want to know what each buildings lobby and pool areas look like - the listings won't always name the building, particularly if AirBnB rentals are restricted there.

Good deals?  *shrug*  Just do your best to avoid comparing anything here to the US market - if you do that then you'll likely see a LOT of great deals.  Depending on what area of the US you're from I suppose.  You will see some head scratching prices, but not because they're such great deals.  Take lots of time, look at everything, talk to everyone, do your homework and get comfortable with the market.  And spend as much time as you can in your targeted buildings - if that's not possible then try and stay in one of the developers other buildings.  And then talk to everyone you run into....

Oh, interesting that the Calyx developer says they have some 'Reopened Units Available'.  Curious if those are units that the developer had financed initially and then the buyers couldn't pay the balance when that short-term financing ended.  No idea, but it would be interesting to know.

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