Pre­pare be­fore de­cid­ing to sell

Make sure fi­nances are in or­der


MUCH has been said about get­ting your fi­nances in or­der be­fore you set out to buy a new home – but it is just as im­por­tant to do some homework be­fore you de­cide to sell your prop­erty.

“If you are sell­ing with a view to buy­ing an­other home, for ex­am­ple, you need to make sure you will qual­ify for a new home loan,” says Jan Davel, MD of the RealNet es­tate agency group. “Just be­cause you have a bond cur­rently, it is not a fore­gone con­clu­sion that you will be ap­proved for a new one – or that you will not be asked to pay a higher in­ter­est rate.”

On the other hand, he says, if your fi­nan­cial po­si­tion has im­proved since you bought your cur­rent home, you may well find that you qual­ify for a big­ger loan now, or a lower in­ter­est rate, es­pe­cially if you are able to use the pro­ceeds of your sale as a de­posit on your new home.

“To be sure, though, you should ask a rep­utable bond orig­i­na­tor to help you ob­tain home loan pre-ap­proval so you will know what you can spend – and gain an ad­van­tage over other prospec­tive buy­ers when you make an of­fer to pur­chase.”

Mean­while, there are also other fac­tors to con­sider be­fore you de­cide to up­grade. “A big­ger or more ex­pen­sive prop­erty will usu­ally also mean higher rates and taxes, a higher home in­sur­ance pre­mium and higher main­te­nance costs as well as a big­ger monthly bond re­pay­ment, so you need to re­view your bud­get to make sure you re­ally can af­ford the move with­out fi­nan­cial dis­com­fort ev­ery month.

“Sim­i­larly, if you are mov­ing from a sub­ur­ban home to a gated com­plex, you will need to bud­get for a monthly levy which you have not had to pay be­fore.”

It is also vi­tal, Davel says, for you to check that your in­come tax re­turns and pay­ments are up to date be­fore you put your home on the mar­ket. “If they are not, SARS can legally lay claim to any part of the pro­ceeds of your home sale that is nec­es­sary to clear or re­duce any in­come tax amount in ar­rears. And that could leave you with­out a de­posit and un­able to pro­ceed with the pur­chase of a new prop­erty.”

Next, you have to con­sider what you may need to spend to get your cur­rent home in sale-ready con­di­tion.

You may not think it makes sense to spend any money on a prop­erty that you will soon be leav­ing, but if you re­ally want that new home, the chances are that you are go­ing to have to spend some to fa­cil­i­tate the sale so you can move on, he says.

“At the same time, you ob­vi­ously don’t want to over­cap­i­talise, and an ex­pe­ri­enced agent familiar with your area can re­ally help you with this. Know­ing the lo­cal mar­ket well, he or she will be able to ad­vise which re­pairs or ren­o­va­tions are worth do­ing in or­der to make your home more ap­peal­ing to prospec­tive buy­ers - and where to pitch your ask­ing price in or­der to at­tract max­i­mum in­ter­est and en­sure the quick­est pos­si­ble sale.”

Then fi­nally, says Davel, you must make sure you have all the com­pli­ance cer­tifi­cates and other doc­u­ments you need be­fore you list your prop­erty for sale. “Th­ese may in­clude plumb­ing, gas, elec­tric fence and bee­tle cer­tifi­cates in ad­di­tion to the elec­tri­cal cer­tifi­cate of com­pli­ance, and it is also re­ally very im­por­tant to make sure that there are no unau­tho­rised build­ing al­ter­ations or ex­ten­sions on your prop­erty.”

‘Check your in­come tax re­turns are up to


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