
Everyone would like a home of their own, but buying one can be tricky. This handy guide can make it easier.
Buying a property is no small feat. It’s one of life’s most important decisions and, for many, it’s the most significant investment they will ever make. The first home you buy is usually the toughest and most stressful to choose because you don’t know what to expect. It also often happens when you’re most vulnerable financially.
Buying a home comes with emotional baggage and the chance of being duped, manipulated or swayed. And because it’s about where we’re aiming to put down our roots, we instinctively want to choose a home that says as much about our personality and sense of self as it does about our financial status. So, what’s a first-time buyer to do?
BEFORE YOU VIEW
Location should be your primary consideration when looking at properties – it’s the one detail that cannot be altered. Identify the areas that appeal to you and eliminate the ones that don’t. Consider security, climate factors (how much wind or sun it gets), distance to travel to work, access to schools (if you have children), availability of amenities and ease of access for visitors.
THE HUNT BEGINS...
Once you’ve pinpointed locations, the viewing process begins. When you go house-hunting, the following list of considerations can help you avoid any unwanted surprises:
- Factor in the age of the property
Older homes have strong walls and foundations, but might require more attention to the hardware. They may have hard-to-replace features or outdated electrical components, so you might have to fork out money to see to these repairs or updates.
- Ask about recent repairs or renovations
Ask the agent about what was fixed or changed (recently or historically) and inspect the specific area: Is it a sloppy cover-up job or will it stand the test of time? Look out for water damage, roof leaks, dampness or previous incidents of mould or pest infestations.
- Find out how energy efficient the property is
Some newer properties have solar geysers and even solar panels already installed, so they’re better able to cope with the changing demands of climate change and a more sustainable future. Plus, a home that runs on solar energy will save you money in the long run.
Assess the condition of a property’s built-in appliances, the roof and gutters, electrics and plumbing. If anything seems dodgy, you have the right to ask an architect or structural engineer to check it out.
- What are the monthly expenses?
Your new home should not be costing you more than what you can afford to cover utility costs (municipal garbage disposal and so on), existing rates and taxes, and any additional regular fees such as a levy, if you’re looking at a flat or townhouse development. If there’s a decent-sized garden (or pool), this will impact your water bill too.
- What’s the neighbourhood like?
Ask about the people who live in this area (older, younger, mixed?) and the neighbours in particular. Find out if there are any crime hotspots. Also look out for infrastructure such as power lines, noisy factories, busy roads, petrol stations and so on. Being in close proximity to these can negatively impact your living experience and diminish the property’s value. In this regard, be aware of open spaces of land that may be developed in future.
CAN YOU AFFORD IT?
Unless you’ve saved or inherited enough money to pay cash for your new home, you’re in for a long-term relationship with the bank that furnishes you with a loan. Banks generally loan you an amount with a 10% monthly repayment value that’s equal to a third of your salary. So if that’s R6 000, then your loan will cover a R600 000 home.
Be prepared for additional costs. You will need to set aside money for the deposit, which must be paid as soon as your offer gets accepted. The agent may push for 10% but a smaller deposit is also fair. (If the sale does not happen, the deposit will be refunded.)
A transfer duty is payable on homes worth more than R1 million, and this fee (calculated on a sliding scale) along with the cost of attorneys and other sundries will be added to the bill.
The biggest shock to many first-time home buyers is that these fees must be paid as soon as the home is transferred into your name – and they are not covered by your home loan (unless you factored them into your calculations). Take into account that there are costs associated with the loan agreement, too, as well as bond initiation fees.
Aside from these initial costs, always have contingency money to cover your ‘moving in’ costs. You should budget for the furniture movers and any immediate changes that may be needed in your new home. Curtains, new locks on doors, deposit fees for monthly services, security upgrades, appliances and certain ‘can’t live without’ items may suddenly be required.
You may also need to pay occupational rent to the seller for a short period if you move into your new home before the transfer of ownership has legally been finalised. This amount will be stipulated in the paperwork, but it’s an additional cost you must prepare for.
REMEMBER: BUYING A HOME IS AN INVESTMENT
Most homes take between four to seven years before you see a return on investment (that is, before you can make your money back on the purchase), so you are likely to live in this space for quite a while. Think about your future plans and how the property will fit into these. Will it accommodate potential lifestyle changes, such as changing jobs or starting a family? Access to schools may not be important right now, but that will change if you have children.
TAKE YOUR TIME
It is easy to feel intimidated by estate agents, whose primary aim is to make the sale. They may use tactics to speed you into signing the Offer to Purchase, a legal agreement that, if accepted by the seller, binds you to buy the property. Don’t rush; read everything carefully.
You might be told about ‘lots of other interested parties’ or time running out; that other offers are being made or that sellers will be offended if you make a lower offer. Stand your ground and don’t commit to anything until you are 100% certain of your decision.
View the property more than once, bring family and friends to get their opinion, have the property assessed by an expert. You’ll only buy your first home once, so make it count.
Text Courtesy of Living Space Magazine
Photography: Getty Images
Most homes take between four to seven years before you see a return on investment (that is, before you can make your money back on the purchase), so you are likely to live in this space for quite a while. Think about your future plans and how the property will fit into these. Will it accommodate potential lifestyle changes, such as changing jobs or starting a family? Access to schools may not be important right now, but that will change if you have children.
TAKE YOUR TIME
It is easy to feel intimidated by estate agents, whose primary aim is to make the sale. They may use tactics to speed you into signing the Offer to Purchase, a legal agreement that, if accepted by the seller, binds you to buy the property. Don’t rush; read everything carefully.
You might be told about ‘lots of other interested parties’ or time running out; that other offers are being made or that sellers will be offended if you make a lower offer. Stand your ground and don’t commit to anything until you are 100% certain of your decision.
View the property more than once, bring family and friends to get their opinion, have the property assessed by an expert. You’ll only buy your first home once, so make it count.
Text Courtesy of Living Space Magazine
Photography: Getty Images
HANDY TIPS WHEN BUYING A NEW HOME
Reviewed by Amaarah
on
July 09, 2024
Rating:
