You’re about to buy it – now own it
With an upswing in homebuyer activity across the South African property market since our general elections in May, many people find themselves in that exciting, yet at times overwhelming, position of being on the brink of homeownership. According to Leadhome’s CEO, Marcél du Toit: “It is most definitely a buyers’ market and while the property market has remained fairly flat, this is good news for first-time buyers seeking to invest.”
So, whilst you are ‘shopping around’ for that home that will tick all the boxes without breaking the bank, consider these top 10 tips:
1. Get the best bond
Banks and bond originators abound but don’t get intimidated, get informed. You owe it to yourself to pursue the best possible interest rate for an amount you can afford, so shop around for preapprovals. As Bondspark’s head of marketing Romy Zwiers notes: “A lot of first-time buyers entering the property market, are looking to take advantage of favourable lending rates, where banks are more receptive to giving 100 percent home loans than previous years.” This will also be a valuable step in determining the price range you can afford when you start looking for that new home.
2. Print is out, online is in
When you start your property-search, forget about those grainy photographs accompanying ‘house for sale’ ads in newspapers. The main reason is that a dynamic property market can change from morning to night, meaning you need real-time, up-to-date information.
3. Location, location, location
This overused adage still holds true. When considering where to buy, try to do as much research possible on the neighbourhood, its facilities, trends and developments over the last years as well as possible restructuring or developments in the (near) future. Does it offer the safety, parks, amenities and schools you require? Will the commute to work be affected by arterial road bottlenecks and such?
4. Size does matter
But not in the way you think. A global trend in downsizing has seen homeowners make the most of smaller properties. In South Africa, the exponential increase in rates and taxes, electricity, and water, means higher overhead costs for keeping your home in peak condition. If your budget allows for the upkeep of a larger house and property, fantastic, but if it doesn’t, don’t overextend yourself to keep up with the Shabangus.
5. Plan baby plan
Purchasing a (first) home involves many steps from tying up ends on your departure front (be it from that garden flat, your childhood bedroom, commune or that rental) to negotiating with agents, sellers, conveyancers and movers. It might feel overwhelming but you’ve got this. Make lists, speak to those involved, ask questions, draw up a timeline and tick off that to-do list as you go along. Your adrenal glands will thank you.
6. Budget more, spend less
Becoming a new homeowner comes with a variety of costs such as a bond origination and registration fee (Bondspark does not charge an origination fee, see bondspark.co.za), transfer duties, agent’s commission and attorney fees. Find out what all these (hidden) costs amount to, include them in your budget and empower yourself with this financial knowledge to avoid monetary hiccups along the way.
7. Insurance matters
One of the joys of becoming a homeowner is that you have invested in an asset. For most of us. it’s the biggest asset (in material terms) we’ll ever acquire. This asset needs to be insured though for your and the bank’s sake. That’s why homeowner’s insurance (for full title deeds) is compulsory but take heed, it does not include cover for the contents of your home, only structural damage to the property.
8. Spring clean
No matter the month you become a new homeowner, it’s an ideal opportunity to spring clean your life by sorting through your possessions (what to take and what to get rid of), getting your finances in order – you don’t want to miss a single bond repayment – and re-evaluating your goals. A new home comes with many challenges but if you’ve been a thorough spring cleaner the benefits and joys will far outweigh the initial hurdles.
9. Settle securely and maintain
Before you arrive at your new doorstep moving van in tow, take a moment to inspect the property and repair, paint or fix as required. If your home doesn’t have a good security system in place, consider installing one or upgrading the current system. Once you’ve settled in, maintain your property to ensure it retains or preferably increases its value.
10. Remember why you’re doing it
When the going gets tough, gently remind yourself of all the reasons why you chose to become a homeowner. “Buying a property requires a long-term outlook, which means the asset will provide good returns in the long run,” says Leadhome’s CEO, Marcél du Toit. Financial guru, Suze Orman, concurs that “owning a home is a keystone of wealth…both financial affluence and emotional security”.