A New Year’s resolution to purchase property will improve your life but will require financial commitment and discipline.
Most of us make (and break) New Year’s resolutions. Gyms, for example, are generally chock-a-block at the beginning of every year as people pursue their new year fitness goals. However, by the end of January the numbers have tapered off and by June, the large majority of people no longer frequent the gym at all. It goes without saying that some resolutions are more important than others; making a concerted effort to stop smoking is going to improve your health dramatically and sticking to a new diet if you're overweight will prove beneficial in both the long and short term.
Another resolution that is going to improve your life in the long term is resolving to buy a home. However, a property purchase requires a firm financial commitment and even if you believe you will be able to secure a 100% bond, you will need access to additional cash reserves when taking the plunge. Things like transfer costs and conveyancing fees fall outside the bonded amount and are for the buyer’s account. Other costs should also be factored in, such as the need for a new lawnmower, or new curtaining and furniture to go with the new home.
So what should potential first-time buyers be concentrating on? The short answer is saving every spare cent and putting the money into a dedicated savings account. They should also start educating themselves on all things property. What's the average price paid for a home in the area where they want to live, how to spot a bargain and, perhaps the most important of all - recognising how vital the location of the home is. Location is everything in property and while buying a home in a less desirable area may well be less expensive, it pays to remember that the same holds true in reverse – the price will be negatively affected when they decide to resell the home.
Prospective buyers should have a clear idea of what they are looking for before they log onto the Internet and start a search. Property portals, like Private Property, offer refined search options that allow browsers to specify the price, and the number of bedrooms and bathrooms required among other things. This can save both hours and frustration (yes, we know, we'd all like to buy a mansion that costs millions, but unless you've been born with the proverbial silver spoon in your mouth, it's unlikely you’ll be able to afford anything too palatial).
There is nothing more soul destroying that discovering you've paid too much for something. And price, because of the large sum involved, is particularly important when it comes to property. Ask the agent concerned to provide a list of what properties have sold and at what price in the immediate area over the past six months or so. There may not be hard science behind this, but it will give an indication of the average selling price in the neighbourhood. If the chosen home is priced way higher, ask why and if necessary, move on to something that is more realistically priced.
Buyers should never allow themselves to be rushed or bullied into making an offer. It doesn't matter how many people are allegedly interested in the property or that the agent knows of someone who is about to put in an offer – take your time and do the necessary research (unless, of course, it's clearly evident that the home is an absolute bargain) before committing.
Remember, the first couple of years of homeownership can be tough going financially, but before you decide to throw in the towel, think about the long-term financial benefits. There probably isn't anything quite as rewarding as owning your own piece of Africa – so make this a commitment you actually stick to.