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Make a small fortune by investing P20,000

Published by GMA News Online – July 4th, 2016
These days, P20,000 may not sound like much.  It’s so easy to simply head off to the mall and blow it all on gadgets, clothes, or food. One swipe of your credit card and it’s all gone.

But if you do it right, your P20,000 can grow and make you a small fortune.
The big question is “Where should you invest your P20,000?”

There are many wise options available, and we have listed eight investment options for you.

The Job Hunter’s Interview Survival Guide

Orig. source published by Kalibrr Career Advice – January 5th, 2016

It’s job hunting season again. And there’s no scarier beast than the interview.

Interview Survival Guide

It’s the start of the New Year, and you know what that means: it’s job hunting season again. Companies are on the lookout for new hires, and job seekers (like you!) will be on the lookout for great companies. But after the resumes have been written, the applications sent, and the interviews scheduled, the hardest part remains to be the interview itself.

To help you ace one of the most iconic and crucial parts of the job search, we’ve compiled a list of the most helpful interview articles on Kalibrr Career Advice. Read through this Interview Survival Guide, and you’ll definitely find yourself getting offers in no time.

1. How To Prepare For A Job Interview

job interview

Preparation is half the battle, and many job hunters walk to their doom by going to an interview without a hint of preparation. There’s more to the interview than just the talking and the shaking of hands. Think of it like an exam that you have to pass so that your interviewer, and the company, will see how qualified you are from the role. Dindin Reyes lists down 5 easy steps to getting ready for your next interview.

2. The 5 Common Interview Questions and How to Best Answer Them


Even the simplest questions can leave you stammering and stuttering if you don’t think about it in advance. In fact, the question “Tell me about yourself” can either turn you into the next employee of the century…or the worst. Make sure to read this list of common interview questions by SlideGenius before you even step into that interview room.

3. The Best Answer To The Interview Question – “Tell Me About Yourself”

The Best Answer To The Interview Question – “Tell Me About Yourself”

Speaking of the dreaded question — we wrote an article about answering “Tell me about yourself” because while it might sound so simple, it’s also just as easy to slip when answering it. Some talk about their life stories; others go wild on their hobbies and interests. And a special few will even go as far as spilling their most intimate of details. (No, don’t do that.) The question should be seen as an opportunity to sell yourself well, and Paul Rivera, CEO and Co-Founder of Kalibrr, provides simple, but great, advice on how to own it.

4. Do’s (and Don’ts) On Dressing Up For Your Next Interview

SlideGenius Wardrobe For Interview

Beauty is only skin-deep, but that doesn’t mean you shouldn’t care about how you look. Part of winning at a job interview is also making sure you dress right for the part. While it might seem cool to go to an interview wearing your favorite cool T-shirt or your designer blouse, will it make you look professional enough to be taken seriously? SlideGenius‘ second article for Kalbirr Career Advice put together these quick pointers on how to dress to impress, in the right way.

5. 9 Interviewer Biases Every Jobseeker Needs To Watch Out For

[FEATURE] Interview Biases-01

Interviewers are human, too. No matter how objective interviewers try to be, their personal inclinations can, and will, affect how they see you as a candidate for the job. Of course, being impressive and qualified will rarely be affected by your personality (unless you’re that unbearable), but it’s always good to know what little (or big) things can make your interviewer change his/her mind about you.

6. 8 Questions You Must Always Ask Your Interviewer (Part 1 | Part 2)

Questions to ask during an interview

Just because you’re the one getting screened for the job doesn’t mean you shouldn’t be asking questions. Once the interviewer is done grilling you about your qualifications, it’s your turn to interrogate your interviewer. This will be one of your few chances, if not the only one, to know more about the company you’re getting into and the job that you may eventually accept. Daniel Olivan gives you a list of questions that you should ask every interviewer, especially if the job seems too good to be true.

7. Things You Need To Do To Ace That Skype Interview

[FEATURE] skype

Interviews won’t always be in person, especially if you’re eyeing for a job abroad. Thanks to the broader reach of technology, Skype interviews are becoming more common in many companies. Because the interview is happening in a different space, the rules are also different. In this Career Advice post, we share with you a video that will give you tips on how to ace that Skype interview.

8. How To Respectfully Reschedule A Job Interview


Sometimes, things happen without warning. A family members gets into an accident. The roads are impossibly congested with traffic. It can even be as ridiculous as your overly playful dog ruining your one and only interview-worthy outfit. While some excuses are less excusable than others, there are cases when rescheduling an interview is unavoidable. Once you’ve decided to seriously ask for a resched, make sure to follow these pointers by Marga Salvador to help make this awkward situation go smoothly.

The best answer to the job interview question ‘Tell me about yourself’

Written by Paul Rivera | Rappler – May 10th, 2016

‘If you answer this poorly, you set yourself up to get grilled by the interviewer. You’ll be a nervous, rambling wreck,’ writes Kalibrr co-founder and CEO Paul Rivera

TELL ME ABOUT YOURSELF. This seemingly simple question can make or break an interview. Illustration by Ernest Fiestan/Rappler

TELL ME ABOUT YOURSELF. This seemingly simple question can make or break an interview. Illustration by Ernest Fiestan/Rappler

An earlier version of this story first appeared on Kalibrr. Visit this page for more on the ups and downs of navigating your career.

Talking about yourself should be easy, right? Who knows you better than you? However, in an interview, we don’t want to know everything about you. We don’t care about your life story – who your parents are, what they do, your religion, and where you live. Its probably the most common mistake I see people making – spending too much time talking about personal information, rather than painting a picture of their professional background and career aspirations.

If you answer this poorly, you set yourself up to get grilled by the interviewer. You’ll be a nervous, rambling wreck. We’ve seen it many times and its entirely avoidable if you’re prepared.

If you are prepared and answer this question well, then you set the tone for the interview and immediately begin the process of selling yourself to the interviewer.

And that’s what you’re doing here – you want to start the interview by essentially saying how awesome you are and why I’m the best candidate for this job.

The best way to answer this question is to make sure you cover this core theme in your answer:

How does your personal and professional background relate to you being an extremely good candidate for the position you’re interviewing for?

Any information that doesn’t make a strong case for you should be an excellent candidate isn’t important here.

A good answer shouldn’t be more than 60-90 seconds and should cover core these core points:

  • Where’d you go to school (and what you studied)
  • A very short summation of your career or background
  • The last job you’ve had, what that company did, key responsibilities and one important impact you made in that organization
  • Why you’re there interviewing for this job

Here’s what I would say if I were interviewing for a call center agent:

Hi, my name is Paul Rivera. I graduated with a Political Economy degree from UC Berkeley and have spent the last 10 years working for and starting internet startups. I’m currently the CEO at Kalibrr. Kalibrr is talent matching platform based in the Philippines with global investors like Y Combinator and Omidyar Network. My key responsibilities there include management of strategy, sales, customer success, marketing, finance and legal. I spearheaded the raising of $2 million in venture capital funding for Kalibrr in 2013, which was a record for a seed round for a Philippine startup. I’ve also directly managed product before creating a product team overseen by our COO. Though I enjoy the work I do at Kalibrr, I see a tremendous opportunity to leverage my skills and experience, especially with excellent communication ability, to be an outstanding call center agent at Accenture and that’s why I’m here interviewing with you right now.

The best thing about this interview question is you almost always will get it so practice it, rehearse it, and memorize it so you start off your interview in control and with momentum. Your answer and how well you tell your story will drive the rest of the interview. In our opinion, the better you start, the better you finish.

What if you have no professional background and just graduated from school?

Not a problem – here are the core points you should cover:

  • Where did you go to school
  • What was your course and how is that going to be useful for you for this job
  • Key coursework, an internship/OJT, or work experience and what they taught you
  • Why this company + this job to start your career?

If Paul was graduating from Jose Rizal University with an HRM degree and was interviewing for a Recruitment Assistant job at Globe, here’s what he would say:

Hi, my name is Paul Rivera and I’m a fresh graduate of Jose Rizal University. I studied Human Resources Management because I really enjoy working with people and I’m fascinated with the role of people in building and operating companies. Without the people, you don’t have a business. While in school, I was an OJT during my fourth year at Jollibee Corp where I worked with their recruitment team and helped coordinate the interview of candidates for cashier roles at Jollibee restaurants. I really understood the role and value that recruiters create and how they help ensure a company always hires the best talent. I saw an opportunity on Kalibrr to be a Recruitment Assistant at Globe and after doing my research, I saw that Globe was one of the best companies in the Philippines and I feel my experience and work ethic will make me a valuable contributor at Globe.

So there you have it – a template for you to answer the ‘Tell Me About Yourself’ question. Write this down on paper and practice it until you have it memorized and can say it without looking like you’ve memorized it. Make sure you customize it for every interview you do – so research the job and the company and really understand what they do and how you could add value to them.

Put on your best Piolo Pascual and nail that interview.

2016 Philippine presidential election like in a basketball game

Prenella | PNGS Inc. – Tue, 26 Apr 2016

As Head Coach of your team what will you do? Sure 2 or gamble to 3 pts?

2016 Philippine presidential election by pngs inc

I’m a simple and ordinary person only that want to share my own perspective and political view in the coming 2016 election. Please allow me to share my political views in the most important and most anticipated event in our country this coming few days.

My goal is to enlighten some of our fellow voters to think and decide heart fully. That’s all.

Here’s the DEAL –  At present based on facts that our country Philippines is at MOVING UP mode meaning from the ‘Sick man of Asia’ to the one of the best performing country in the world.

Since Philippines is a basketball country let me compare this coming election decision that we need to decide as situation in a most important basketball game of our life.

Here’s the situation:

In a basketball game your team is behind by two (2) points with only three (3) seconds left in the official time of the game.

As Head Coach of your team, what solution or choice you will do?

  • a.) Mar Roxas (Tabla) – You can take the sure two (2) points. (I said sure 2 pts because given that it is surely will goal-in for this situation)
    By choosing him you are guaranteed that you will not loss the game. It’s just a tie breaker of the present situation of our country today. He will just continue what the previous administration did in our country.
  • b.) Rodrigo Duterte (Sablay Talo) – You can try the three (3) points big shot by chance. (There’s a possibility to goal in or out)
    By choosing him you are putting our country to a big gamble of your life. He can give us big success or the new TIGER country of Asia (if the ball will goal-in) or big FAILURE  if not (from Moving Up mode present situation to ‘Sick man of Asia’ again)
  • c.) Grace Poe (Tabla o Talo) – Choice ‘c’ is a little bit different situation instead of two (2) pts your team is left behind by three (3) pts. If goal-in possibly almost the same or continuation of the present situation or tabla. If goal-out expect the worst or talo.
    By choosing her She can duplicate or a little surpass what the present administration did (if goal-in) or expect the worst (if goal-out).
  • d.) Jejomar Binay and Miriam Santiago (tambak na) – Your team left behind by big margin. So there’s no chance to win the game.
    Explanation (for Santiago):
    Honestly Miriam is my presidential choice long long time ago pa since the 1st time she run for the President position but like I said since no chance of winning I will go to my 2nd choice.
    Explanation (for Binay):
    Philippines is a big corrupt na tinubuan ng bansa. So kayo na magsabi why not him. As Duterte said “S-T-O-P”
  • e.) None of the choices a to d
    To those not agree to the given choices or not satisfied to my explanation you are free to choose this answer.

Honestly at present I’m still undecided if which of which is my president this coming election. At sa mga di naman sang ayon sa mga choices or explanation na nailagay ko ay okay lang naman. Wala naman sapilitan sa pagpili ng sagot at pwede nyo piliin yung letter ‘e’ for that reason.

Companies Prioritize Graduates of Top 10 Universities in the Philippines

Written by Summit Express Site – March 8th, 2016

TOP 10 Philippine Universities 2016

MANILA, Philippines – If you are a graduate from one of the top 10 universities in the country, you have higher chance of getting hired, according to the recent survey from

In the study conducted from February 22 to March 6, 2016, it reveals that same top schools in 2015 report emerged on the list.

A total of 550 employers have been asked, and it shows that 8 out of 10 companies are also willing to hire fresh graduates.

The Polytechnic University of the Philippines (PUP) topped the 2016 rankings with 45-percent of companies said they will hire graduates of this institution. PUP, a big game-changer in the list of universities overtakes the Big Four consists of University of the Philippines (UP), University of Santo Tomas (UST), De La Salle University (DLSU) and Ateneo de Manila University (ADMU).

Here are the Top 10 Universities in the Philippines that lead 2016 Jobstreet Survey of Schools that Matter to Employers (% who prefer):

1. Polytechnic University of the Philippines: 45%
2. University of Santo Tomas: 31%
3. Ateneo de Manila University and University of the Philippines: 29%
4. Pamantasan ng Lungsod ng Maynila: 27%
5. Far Eastern University: 26%
6. De La Salle University: 25%
7. Technological Institute of the Philippines: 24%
8. Mapua Institute of Technology:22%
9. University of the East: 20%
10. Adamson University: 17%

UP which ranked first last year is now on third spot, tied with ADMU. UST maintained its position on second place.

Though 6 out of 10 firms said they will hire based on school preference, graduates of other institutions should still be confident about landing a job.

“Dapat huwag mabahala ang mga estudyante kasi kahit may preference ang mga companies, kahit hindi ka galing sa ganoong school, may assurance ka na as long as you’re qualified, 9 out of 10 companies will still hire you and disregard their preferred school,” Yoda Buyco, regional marketing manager of Seek Asia said.


Written by Dianara A. Angeles | S&T Media Service – Jan 4th, 2016

Philippine Standard Time Banner

The Department of Science and Technology (DOST) once again leads the whole nation in observance of the second National Time Consciousness Week (NTCW) from January 4-8, 2016 as it enjoins all Filipinos to synchronize their watches with the official Philippine Standard Time (PhST) provided by DOST’s Philippine Atmospheric, Geophysical and Astronomical Services Administration (PAGASA).

The initiative aims to create a culture of discipline among Filipinos by allowing a shift from the so-called “Filipino Time” attitude to one characterized by punctuality to show respect to the value of time and to other people.

According to DOST Secretary Mario G. Montejo, time is a resource that is very important but often overlooked. “Other than its social and economic value, time is something that can unite us Filipinos,” he said.

To promote the use of the PhST and help achieve this culture of punctuality by synching watches, clocks, and even bundy clocks in offices, DOST’s campaign called “Juan Time” was launched in January 2014.

The activity is in accordance with Republic Act 10535 or the Philippine Standard Time Act of 2013, which requires all nationaland local government offices as well as broadcasting companies to display PhST in their time sources. Signed into law by President Benigno S. Aquino in May 2013, RA 10535 declared the first week of every year as National Time Consciousness Week.

As a kickoff activity for the first ever observance of the NTCW in 2015, the DOST led all government offices in the country in a simultaneous holding of their first flag ceremony for the year at exactly 8 am, Philippine Standard Time on January 6, 2015.


Philippine Standard Instructional Video



Highly anticipated smart scooter aims to tackle Asia’s catastrophic smog problem

By Jonathan Camhi | Business Insider – Jun 22nd, 2015

This story was originally sent to thousands of professionals just like you in this morning’s IoT INSIDER daily newsletter.  Don’t be left in the dark while your competition gets ahead each morning.

Gogoro's SmartScooter

Connected cars are getting a great deal of attention right now, as they offer the chance to transform transportation in Western countries where cars and trucks dominate road traffic. In Asia’s dense mega-cities though, it’s gas-powered scooters, not cars, that rule the road.

Taiwan-based Gogoro is trying to connect those vehicles while also driving down energy consumption in those heavily polluted megalopolises with its electric Smartscooter. Gogoro announced yesterday that it would start taking orders on for its Smartscooters – priced at $4,100 – in Taiwan later this month.

Finding this article interesting? Thousands of professionals just like you had it in their inbox first. Stay ahead of the curve and gain a comprehensive understanding of the latest news & trends, start your day with the IoT INSIDER. 

Gogoro’s scooters include 30 sensors that send diagnostic information to owners’ smartphones via Gogoro’s app and are powered by two 20-pound batteries. When the batteries run low, they can be swapped out at Gogoro’s smart recharging stations for fully charged batteries. Gogoro plans to place networks of its charging stations throughout cities in Asia. It already has 32 in Taipei, Taiwan’s capital city, as part of the pilot it’s running there. It plans to increase that number to 150 by the end of the year. The Smartscooter can travel 62 miles at 60mph on a pair of fully charged batteries.

Gogoro will need the infrastructure of battery-swap stations in place to expand to new cities. The Smartscooter is also more expensive than gas-powered alternatives, but the company says that over the first two years of ownership the electric Smartscooter costs less than some gas-powered models.

Replacing the millions of gas-powered scooters on the streets of Asia’s biggest cities with electric ones would help alleviate the air pollution problems in many of those cities.

Here are other stories you need to know from today’s IoT INSIDER:


Don’t miss another day of breaking developments! Stay ahead of the curve and gain insight into the latest news & trends. Join thousands of other professionals who start the day with IoT INSIDER.

5 Signs That You Are Going To Live Life Poor

iMoney Phils – Thu, 15 May 2014

Personal finance means the management of individual or family finances. This means that you are able to pay for day-to-day expenses as well as emergencies while ultimately saving some part of the money you earn for investment and retirement.

Personal finance, sadly, is not a subject that is taught in school that is why so many people are clueless as to how to manage their own money. Mismanagement of finances is very critical if you want to achieve financial freedom, this is not exclusive to the young because there are also adults who have endangered their retirement funds because of their lack of knowledge in money management. Here are some of the signs that will make you think twice.

1. You keep on waiting for Salary to come in

money jar The Easy, One Step Guide To Becoming a Successful Long Term Investor

It is five days away from payday and you are surviving with a few pesos for food and transportation every day. Whereas when you received your salary, you spend it with getting expensive coffee and buying all the things that you don’t need. Heck you don’t even budget.

2. You Don’t Have a Savings Account

money jar The Easy, One Step Guide To Becoming a Successful Long Term Investor

No! A payroll account does not count. It is essential for everyone to have a savings account for them to create their emergency fund. Experts claim an emergency fund should have at least 3-6 months’ worth of income to cope with emergencies or unexpected changes. The emergency fund is used when your car suddenly breaks down or you have to pay the hospital a visit due to an illness or worse because you quit or lost your job, or you have to pay your mortgage, you will need this money to take care of your expenses. People in financial mess do not have emergency funds so they borrow money for such cases, they take a loan or cash advance, therefore incurring more debt.

3. Unable to Pay Credit Card Bills

money jar goal The Easy, One Step Guide To Becoming a Successful Long Term Investor

Worse is if you only pay the minimum on each of your credit card bill. You could be saddled with credit card debt for 5 years, or even 10 for that purchase you made recently. And if your answer to your financial woes is to apply for another credit card because what you have are maxed-out, or near their credit limit, then you undoubtedly are headed to a financial crisis!

4. You Rely on your Parents When It gets Rainy

money jar goal The Easy, One Step Guide To Becoming a Successful Long Term Investor

The worst thing about not having money during emergencies is asking money to cover for those emergencies. And most of the time, we ask Mom and Dad if they can lend us money, nothing is wrong with that – all of us did that for at least 18 years but if you are working for more than a year now how can you ever pay them back for the money you owe them?

5. You are not even thinking about your retirement.

money jar goal The Easy, One Step Guide To Becoming a Successful Long Term Investor

How about your retirement? You may be young but this is the perfect time to think of your retirement fund. When your retirement plans involve winning the lotto, then you’re in trouble. Some people spend money buying lotto tickets hoping that a windfall will come their way to cover their retirement.

Bottom line

If you somehow find yourself in any of the above situation, it’s not too late to learn the art of delaying gratification. Self-control is your best bet. If you can’t afford it, wait until you have enough cash to pay for it. If you are a young professional without any dependents, it wouldn’t be impossible to set aside even just P1,000 as your monthly savings.

How do you do that? Start keeping track of your expenses which should never exceed your income. List down where you spend your money on a given month and see which portions you can cut back. If only you would limit your booze or think twice before getting that new iPhone, you would have saved a lot already!

Learn how to budget and live within your means to avoid financial disasters!

Homemade aircon for Masa

Prenella | PNGSI Inc. – Sat, 10 May 2014

Homemade aircon by PNGSI Inc.

Sawang sawa kanaba sa init sa Pilipinas lalo na pag Summer Season? Isa ka ba sa masang Pilipino na nagtitiis gabi-gabi dahil sa init ng klima ay pahirapan makatulog? Isa ka ba sa paulit ulit na maligo sa gabi ay hirap parin makatulog dahil sa sobrang init ng klima? Isa ka ba sa masang Pilipino na halos di na magdamit at sa labas na ng bahay, bintana or bubong natutulog para lang mapreskuhan? Isa ka ba sa masang Pilipino na nangangarap na magkaron ng sariling aircon para makalanghap naman ng malamig na hangin sa pagtulog ngunit kapos sa pera ? If malaking ‘OO’ yung sagot mo ay para nga sayo itong blog page na to.

Ginawa ko tong webpage na to ay para makatulong sa masang Pilipino na makaexperience ng malamig na hangin sa pagtulog gamit ang isang ‘HOMEMADE AIRCON’ at maishare narin sa lahat if papano ito magagawa.

Papano nga ba to gawin?

Simpleng simple lang to gawin at kayang kaya mapa babae man o lalaki.


Sundin lamang step by step yung mga dapat gawin:

  1. Ihanda muna yung mga gagamitin na gamit para makabuo ng isang homemade aircon:
    • Maliit na electric fan katulad ng nasa picture (any brand basta same yung itsura nya parehas sa picture).
    • Malaking timba na may takip.
    • Maliit na styro ice box na sukat or papasok sa loob ng timba na gagamitin nyo (if makakabili kayo ng pabilog na ice box mas mabuti).
    • Isang kutsilyo or gunting or kahit na anong matulis na bagay na pwedeng ipanghiwa or butas sa timba at styro.
  2. Simulan ng lagyan ng marka ng pagbubutasan yung timba at styro (Yung hugis ng butas, laki ng butas at dami ay depende sa inyo kung ano mas gusto nyo laki at dami ng butas).
    • Takip ng timba: Sukat dapat yung marka nya sa laki ng electric fan na gagamitin nyo sa ibabaw
    • Gilid ng timba: Depende sa inyo if ilang butas, laki at hugis yung gagamitin nyo
    • Styro: Maglagay lamang ng 2-4 na bilang ng butas sa may bandang itaas na gilid ng styro
  3. Simulan ng hiwain or butasin yung mga marka na ginawa nyo sa timba at styro.
  4. Pagkatapos mabutasan ay subukan nyo nang buuin yung homemade aircon nyo at paganahin para malaman if tama ba yung pagkagawa nyo or mali.
    • Maglagay muna ng malalaking yelo sa ice box (ideal yung malalaking block ice na sinlaki ng hollow block para mas matagal malusaw. Mas matagal malusaw mas matagal yung lamig ng homemade aircon nyo)
    • Ipasok na sa loob ng timba yung styro icebox na puno ng yelo.
    • Ilagay na yung takip ng timba
    • Ipatong yung electric fan sa ibabaw ng takip ng timba na may butas
    • ipwesto yung homemade aircon sa tabi ng malaking electric fan nyo sa kwarto
    • Itapat yung butas ng homemade electric fan nyo sa tabi or likod ng malaking electric fan nyo para yung lumalabas na malamig na hangin galing sa homemade aircon nyo ay hihigupin at deretso ibubuga naman sa inyo ng malaking electric fan nyo.
    • Pumuwesto sa pagtulog sa tabi ng malaking electric fan nyo pra yung lamig ng hangin ay diretso nyo mararamdaman at maeenjoy.

Hopefully maging ganito din kasarap yung tulog ng mga anak nyo sa gabi kahit na wala kayo sariling aircon sa bahay.

*Note: Mas epektibo at maeenjoy ang homemade aircon sa loob ng kwarto at gabi sa oras ng pagtulog.

When Does Buying a Home Make More Sense Than Renting?

iMoney Phils. – Wed, 16 April 2014

Many of us working-age folk grew up in an environment where home ownership is held in high esteem. Our parents and grandparents have instilled in us the importance of owning a home where to raise a family and live out the rest of our day.

My dad, for instance, was able to save up for a parcel of land in his mid-30s, build a house for his family of 11, and then eventually bought a small farmstead not far from our home. Although both houses are projected continuously being improved, he’s now looking forward to his retirement as all of us kids are of working age and have fled the family nest.

The Filipino dream of owning one’s home where one can raise a family is much akin to its American counterpart. Most baby boomers—my dad being one—grew up firmly believing in this philosophy.

But after having watched the U.S. Housing market collapse in 2007–2008, taking the global economy with it, many people of my generation are wondering whether owning A home is as sturdy an investment as our predecessors have heralded them to be. After all, the properties are not liquid assets, they can depreciate, and hot spots come and go. The notion that properties make smart investment has time and again dispelled even by the most respected of economists, chief of which is the Nobel Prizewinning Robert J. Shiller (of the Case–Shiller Index).

money jar The Easy, One Step Guide To Becoming a Successful Long Term Investor

According to Shiller, housing traditionally is not viewed as a great investment because it takes maintenance, it depreciates, and it goes out of style.

“And there’s technical progress in housing… the new ones are better…so why consider it as an investment?” In a nutshell, housing is not really an investment vehicle.

Unless you’re an end-user and wants to buy real estate for your personal reasons.

And to this I agree with Mr. Shiller wholeheartedly. The importance of purchasing a piece of real estate for one’s residence cannot be overemphasized. Living in one’s own home gives families a great sense of security. Sure, there are maintenance issues, but owning lets them sleep soundly at night knowing there’s no landlord who’ll kick them out anytime.

However, because a home purchase in itself is a costly pursuit, buyers are well advised to read these four considerations before making a purchase, even for one to be used as a place for residence.

1. If You Plan to Stay Put for at Least 5 Years

As a rule of thumb, it is generally not advisable to purchase a home unless the property is expected to be owned for a long enough period of time to recoup expenses. If you plan to relocate to another city, say Cebu or Davao, or even overseas, within the next five years for an impending job change, then renting is for you. Or if you plan to start a family soon, then a one-bedroom condo may not be for you. Spur-in-the-moment decisions in home buying may result in firesale if circumstances require moving, and fire sales usually do not work in favor of the seller. As home buying will make the buyer short on liquid cash reserves, he or she must make sure that the property is to be used for a fairly long time.

2. If You Look at the Non- Financial Aspects
The more I read and learn about real estate, the more I realize that the notion of home ownership as a magical path to wealth is just a marketing ploy of the real estate industry to sell more units. Historically speaking, home prices generally barely keep pace with inflation, so why invest in one?

However, there is a nonfinancial aspect of real estate investing, and it is a rather important one. Buying a house makes perfect sense because it gives us stability and freedom. Financially, it may not be the best bet, but there is still a certain level of financial independence that home ownership brings, such as not having to pay for monthly rent, not to mention taking a pesky landlord out of the equation and the eventuality of finally owning the property once the mortgage loan has been paid.

3. If the Price–Rent Ratio Is Lower Than 20

If the housing market’s price–rent (P/R) ratio is lower than 20, then it makes more sense to buy rather than rent. But what is this number and how do you come up with it.

A P/R ratio gives you a rough idea whether homes in your area are fairly priced. All you have to do this is find two similar houses (condos or houses)—one for sale and one for rent—and divide the sale price of the one place of the annual rent for the other. The quotient is the P/R ratio.

For example, there are two identical condo properties (94 sq. meters, three bedrooms) in Penhurst Place in Bonifacio Global City. The first one is listed for sale for Php10 million, while the second is for rent for Php65,000 per month (or Php780,000 per year). If you divide Php10 million by Php780,000, you get a P/R ratio of 12.82.

According to David Leonhardt, in his article published in the New York Times, a P/R above 20 means that the monthly costs of ownership will exceed the cost of renting. A little opaque, but it gives an idea when it makes more sense to buy than to rent. In the case of the Penhurst property mentioned above, it makes much more sense to buy as the monthly rent is greater than what the homeowner would pay on a monthly basis if he buys the property.

4. If You Look at the Financial-Use Aspect

Finally, every home buyer should consider the personal-use aspect when making a purchase. When the house is purchased as a residence, then the property provides both personal-use return and investment return. This means the homeowner can live in the house and avoid paying rent while he or she also experiences gained in the house through appreciation (though appreciation is locked in as the owner cannot use it without selling the house—and lose the place to live in the process).
But in this case the personal use aspect is more important. An initial comparison between renting and buying offhand might favor the former, especially if one takes into consideration the combined costs of mortgage, maintenance, insurance, and taxes.

However, mortgage payment is finite and fixed, whereas rental costs may and will increase. In addition, the mortgage should eventually be paid off, providing the homeowner with a rent-free place to live, which is a great retirement strategy—if the mortgage is paid off at the time of retirement, there will be a reduction in expenses at the same time income falls.

money jar goal The Easy, One Step Guide To Becoming a Successful Long Term Investor

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About the Author

Rodel Ambas is a former editor-in-chief of a property magazine, has written extensively for Philippine-based publications, and is now in charge of ZipMatch’s content strategy. He attended the University of the Philippines, where he majored in Development Communication.