Making the switch from renting a home to owning one can be daunting. Here are a few budget hacks to help you make a smooth transition.
Do you think you’re ready to go from renting your home to purchasing one? Have you considered the extra costs that come with homeownership?
Gerhard Kotzé, MD of the RealNet estate agency group, advises: “Before you start thinking about what new furniture, appliances or even curtains you might need, you should try to establish what additional monthly costs you will face as a new homeowner.”
Buying your own home has many advantages and is a great decision. However, there are a few things to consider and budget for, to make sure it works out well.
- A bigger home means that you’ll need to budget more for managing and maintaining your property. This includes basic DIY projects and general maintenance.
- It’s a good idea to plan for higher water and electricity bills.
- As a homeowner you will now be responsible for paying rates, so this should be factored into your budget.
- If you’re moving into a complex or estate, you will need to budget for a monthly levy or homeowner’s association fee which will increase annually. If you’re moving out of a complex into a freehold home, you will need to budget for things that were taken care of by the body corporate before – such as garden and pool maintenance.
- Homeowners insurance is important to include in your budget, as this will ensure that you aren’t paying into the bond, if your home was destroyed in any kind of disaster.
- Bond insurance should be taken out, as this will ensure that in the event of your death, your family would not lose the home.
- It’s a good idea to put money aside every month into a home savings account, to help pay for any renovations or emergencies at a later stage.
With all costs considered and budgeted for, you’re less likely to struggle with monthly expenses and can thoroughly enjoy owning your first home.