Buying or Building a House

BUYING A HOUSE,

I'm sure you've encountered some agents in the malls giving brochures, pamphlets, etc of a ready-to-occupy houses located in a newly developed subdivisions in nearby provinces. Some model houses are tagged with an attractive price while boasting the community amenities.

The Good.

(1) Units can be occupied right away after you complied with the requirements and agreed with the terms and conditions. You don't have to wait for several months of construction. You do not have to worry about the hassle of dealing with the contractors/workers. (Although, some setup are just showing you a model house then construct your house after you pay the down payment)
(2) Units are payable in monthly basis and/or can be loaned thru Bank or Pag-ibig fund.
(3) You get to see the actual unit before you get it. Others are even offering optional components or variations. You don't need to imagine the actual sizes of the spaces.

The Bad.

(1) Since the unit is pre-built, the quality is hard to assure. Most defects are not noticeable in the first few years of the house. Though some projects constructed by reputable developers are of considerable quality. If you are buying a second hand unit, chances are there are already repairs made that you probably don't know that may become a problem in the future.
(2) Cost is probably high. The Agents/Brokers will have his commissions. The developer should have its profit. The General contractor should have its profit. The Subcontractor should have its profit. The workers should also have its profit. Subcontracting setup is even up to 3rd-4th pass.
Although some developers claim that the construction cost is low because they built the houses in bulk.
(3) You have to live with the design. Otherwise, you'll spend more on renovation works. If you're not that particular on the place you live, then everything might be just fine with you.

For those mid earning employees who want to have their own house as soon as possible, this is the most popular choice. It's not that bad at all. But there could be better with the same value of investment.

BUILDING A HOUSE,

To some of us, building a house is an enjoyable process. At planning stage, they get excited thinking everything they dreamed of to be done specifically according to their preferences. This is of course assuming that they have found a good designer and contractor. But to many of us, we are afraid of this process. Especially if this is the first time we will be doing this.

The Good.

(1) The house is designed the way you want it. From planning, you get the chance to consider your lifestyle. You decide on where to put up the spaces and what are the spaces you need. You decide on what materials to use. Options are almost limitless.
(2) You can see the progress of Construction. You can see and check the materials and structural to make sure of the strength and durability. You have the chance to make last minute revisions, the moment you see something is not according to what you perceive.
(3) You can work out your budget without compromising your preference. With the help of the engineer, you can plan your cash flow. You can then have the option of by-phase construction where in by proper scheduling, wastage can be minimized due to project halt or delay. You can even set priorities so you may choose to finish certain portion and live with it while other portions are still in progress.
(4) The Budget can also be loaned in Bank or Pag-ibig fund.
(5) You will know your house very well. You can also require your contractor an As-built plan  so you'll have reference if you need to troubleshoot anything like electrical and plumbing system.

The Bad.

(1) You can not move-in immediately. You will have to wait till the construction is finished or portion of it is already livable. It might take you at least 3 months to a year to construct and move-in.
(2) You need to involve yourself in every concern during the construction period. It consumes your time. Although, you will be advised and assisted by the designer and the contractor, you will have to make so many decisions. If you find this enjoyable, then its a good rather than a bad.
(3) You will need to pay for construction documents, bonds and taxes. You have to pay your designers for the plans and documents they will be preparing as well as for the signs and seals as required by the city building official. You might also need to pay for construction bonds, contractors all risk insurance (CARI), processing of permits, fire safety, etc. (Although, you may opt to let your contractor do these for you)

Other worse things that could happen;

(1) You have a poor concept of design and space. You just found out that it is not what you want after the building is done.
(2) You engaged with bogus or incompetent contractor. After you gave the downpayment, the contractor is nowhere to be found. Or the contractor's skills did not meet the quality you want. Or the contractor did not finish the project because of some reason that maybe your fault or his fault.
(3) You always decide late or changes your mind every now and then during the construction period.
The project is delayed because they are always waiting for your decision.
(4) Your suppliers caused delays on your project. Or you did not pay on time, that causes the delay.
(5) You ran out of budget in a compromising stage of construction. (Although, this will less likely happen if your contractor prepared a cash flow plan and gant chart)
(6) You violated some subdivision rules that causes a lot of wasted materials and labor accomplishments.


As you can see, It will still depend on you, your designer and the contractor you will hire. If you ended up with a good designer and reputable contractor in a reasonable contract price, then you will most probably have an enjoyable construction experience and a good project.

In my next posts, I'll be listing down some tips in finding a good Designer and Contractor.