What to consider before buying the land
Do your own research on the developer, type of soil and plans
When it comes to property ownership, people often consider buying an-already built home instead of purchasing land due to the risks involved.
* Thabisa decided to take the unconventional path last year when she bought a plot in St Francis Bay, Eastern Cape.
“I bought the land as an investment first and foremost, but I would love to build one day because I believe building is the more affordable way of getting the house I truly desire. However, in the event that I cannot afford to build, I can hopefully sell the land for a return,” said Thabisa, 37.
Her first consideration was the return on investment and the type of land, location and possible future value.
“The second consideration was having sufficient money to actually acquire the land because most banks do not grant 100% bond on vacant land like other types of property. They normally grant between 40 and 60%, 80% if you are lucky.
“The third consideration was my ability to afford the monthly rates I would have to pay for a property that I do not reside in,” said Thabisa.
She is paying municipal rates of R1,100 per month.
“The biggest challenge was finding the ‘right’ type of land for the purpose I am buying it for. I had to do my due diligence and careful consideration before buying and shopping around in the right areas that have value and will continue to develop value in terms of always being sought after by property buyers.”
Her other challenge was securing the deposit. “The banks deem acquisition of vacant land as risky opposed to buying a house. I had to use my savings to make the purchase possible.”
Property expert Matseleng Mogodi, who is also the founder of Snooks Estates, said sometimes buyers face possibilities of being duped by dubious agents and sellers.
“First and foremost, the person or company you are purchasing from, verify whether it’s their stand, or whether the development is legit. If you are buying to build a home, check that the stand is zoned residential,” said Mogodi.
She said it’s also important to get more information about the developer or land, especially if they are selling just the stands, verify who you are paying the money to.
“It is also important to know the soil conditions on the stand, so there must be a geotechnical report because this may also determine what needs to be done on the stand before building.”
Moreover, where you are not sure how the stands are or the sales people are vague, check whether there’s a township layout plan and whether it was completed or not; also ask if there are approvals for roads, stormwater, sewer, water and electricity.
“Finally, before stands are individually demarcated and sold, a general plan or proclamation of the area with the surveyor generals’ approval needs to have been done and then the land surveyor’s certificate would be in place to verify the sizes and boundaries of each stand,” said Mogodi.
On the rise of criminal elements which infiltrate the selling of residential stands, it’s important to ensure that you do not fall victim to unscrupulous sales agents.
“Make sure where you are buying the land there’s a proper site plan, where stands are clearly labelled and you can make out which stand is which. Sometimes these kinds of agents sell one stand to many people and collect money from individuals...” said Mogodi.