Buying your first home away from home

Private Property South Africa

It’s human nature to aspire and want a home to call your own. For young buyers keen to carve a niche for themselves, the prospect of purchasing a home can be that much more exhilarating – and daunting.

Purchasing a home is a long term commitment. It’s also the biggest expense that most of us will ever undertake. As such it’s crucial that you find out as much information as you possibly can before committing to a purchase.

As a young buyer, you will probably feel inclined to chat to your friends about buying a house. You might even decide to air the topic online via social media platforms. While not necessarily a bad idea in itself, you’ll probably find that most of the comments stem from people who are still living with their parents or renting. No doubt many will wax lyrical about how difficult it is to get a bond or share scare stories about expensive disasters. A friend may also tell you how someone – not anyone they’ve actually met mind you – made a fortune by buying old houses and flipping them.

Although your friends might mean well, it’s best to rather talk to your parents first. Your parents will in all likelihood have run the property gauntlet at least once or twice and should be able to guide you to an extent. The next step is to talk to your bank. You’ll save yourself a lot of time and effort if you know what you can afford to spend before you start looking.

Other practical pointers which will assist you in buying your first home include the following:

Property types

What is the difference between freehold and sectional title? Freehold entitles you to renovate and upgrade your home as you please (within reason). Sectional title properties typically can only be renovated or upgraded according to specific, pre-determined aesthetic guidelines. Although more restrictive, sectional title properties typically provide better security, facilities and reduced maintenance costs.

Finance

Your monthly bond repayment shouldn’t exceed more than 30% of your gross monthly income. If you think that means you won’t be able to afford anything more than a shoebox, sized studio flat, don’t despair. Your partner’s income will also be taken into account. Your parents might also be able to assist you with a deposit which should boost your prospects.

Ask your bank about first time home loan offers. You may find a deal that includes a few extra perks or a lower repayment rate. Don’t forget that in addition to your bond there are transfer costs, conveyancing costs, insurance, rates, taxes, water, electricity and maintenance which need to be budgeted for. It’s also useful to know that properties priced at R750 000 are transfer duty free.

General concerns

Once you’ve established what kind of property you like and what you can afford, you can start to look at other issues which will affect the value of the property as well as its overall suitability.

For instance, how close is the property to your work and other amenities such as schools, shopping centres and gyms? Does the property lie on a noisy flight path, near factories or next to a popular night club? Are there any environmental concerns such as pollution or flooding? Ask if the area gets buffeted by strong winds on a regular basis. What is the general condition of the area? Does it look run down? Are the roads pockmarked by potholes? Do the streetlights work? Are there any informal settlements nearby or vacant land which could present a security threat? Are a lot of properties up for sale?

A good way to gauge the nature of the area is to drive around the neighbourhood and get a feel for it yourself. Try and speak to residents, a local security company or police station or simply pick up the local newspaper to see what’s happening in the area. It’s easy to get swept up in the excitement of buying your first home but don’t let it cloud your judgement of an area and its issues.

The house itself

Before signing on the dotted line, conduct a thorough inspection of the property. Better still, hire the services of a reputable, independent building inspector who will be able to identify any latent or patent defects and prevent you from making a costly mistake.

The offer to purchase

Make sure the property is accurately described and that the purchase price details are correct. If there are any exclusions or special conditions such as the granting of a home loan these must be included. Ensure that the seller provides a current electrical certificate and lastly, before you sign, run through all the documentation with somebody you trust such as a parent.

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