What a first-time buyer must consider
WHILE renting a property offers a tenant the luxury of selecting a home that meets their short-term needs, purchasing a home is a far larger commitment that requires careful consideration.
This is according to Adrian Goslett, Regional Director and CEO of RE/MAX of Southern Africa, who says that it can never be overemphasised how important it is for would-be home buyers to undertake thorough research before they buy a property.
Goslett suggests five things that every firsttime buyer should consider as they begin the process of purchasing a property:
1. Is there the possibility for growth? Due to the fact that property is a medium- to long-term commitment, it is important to look for a property that can grow with your developing needs.
If possible, buyers should shop for a home that meets their current requirements, but also has the potential to adjust to a changing household, says Goslett.
“It’s not an exact science as your five-year plan may not pan out as expected, but it is a good idea to consider the possible life changes that could occur and impact your need for an extra room or additional space.”
But it’s not only growth in size that buyers should look out for. Goslett says that any property purchase is an investment, so it makes sense to ensure that the property being bought has the potential for growth in value too.
“By following the basic rules of buying a property, such as adhering to the adage of ‘location, location, location’, and checking area statistics and figures to ensure that the home is being purchased for fair market value, buyers can be fairly certain that their investment will see capital appreciation over the long term.”
2. Make sure of the basics While the first property you buy may not have many luxury features, buyers must ensure that all the basics are in good condition.
According to Goslett, the property should be thoroughly inspected to ensure that there are no hidden defects that could be costly to repair. While a list of any known defects should have been made known to the buyer, it is still worthwhile to enlist a professional inspector to take a look at the property.
3. Everything has a lifespan Along with identifying aesthetic and structural defects, it is important to look at features of the home that are currently in good condition, but may need to be replaced in the near future. Everything has a lifespan and may require repairs at some stage, so look at the condition of features such as roof and flooring, he says.
How long will it be until these need to be replaced? Researching the expected remaining life on large-ticket items can help you plan for the future.
4. There is no perfect home It is likely that the first home you buy will not be perfect, but it’s important to make sure that it is the right home for you.
“The way to ensure that you are buying the right home is by prioritising the elements that you can’t do without, nice to haves and the things you are willing to compromise on.”
Although a double garage is nice to have, it may suit you more at this point to have an additional bedroom or larger garden. The importance of each of the features offered will depend entirely on the buyer’s personal tastes and needs, says Goslett.
5. Weigh up all the costs Buyers need to remember that it is not just the bond repayments that need to be budgeted for and considered.
There are other recurring monthly costs involved in owning and maintaining a home. According to Goslett, it is vital the home buy- er selects a property that meets their budget in terms of what the full living costs will be, and not just the bond repayment.
Things to consider would be the cost of the utilities, rates and taxes, levies and maintenance costs.
These are not costs that are considered by the bank when approving finance, so it is important to calculate these costs with an experienced real estate agent or a bond originator.
In terms of the financial commitment and length of time that homeowners are likely to be in the same home, buying a property requires far more homework than renting, says Goslett.
“To ensure that the correct decision is made, which will result in a return on investment, and more importantly their happiness, buyers should take the time to weigh up all the options available to them.”