The checklist buyers shouldn’t forget

Buying a home is a big decision and there are plenty of hints and tips to help buyers with the process.

However, says Francois Venter, director of Jawitz Properties, there are some aspects you should consider that you may not have thought of before.

When you buy a home, you are actually making two purchases – one is the property and the other is the money you are buying (the bond) to pay for the property.

If interest rates rise by 1 percent, the price of your home would need to go down by 10 percent to ensure the same monthly payment on your bond. You need to pay attention to interest rates – they add much more buying power to your purchase than low prices. Interest rates are low at present, so this is a good time to take out a bond, but be sure to budget for interest rate changes so that your property will still be affordable over the long term.

Read the fine print – You may fall in love with a property just by looking at the brochure, but you every home generally comes with at least one problem.

“If you get an inspection report for the property, you may find that it is actually full of little problems, covering pages and pages and pages of the report,” says Venter. “However, unless something serious has been revealed, keep the inspection report in perspective as perfect properties don’t exist.”

Cash buyers beware – Buyers who take bonds are normally required to take out building insurance. Cash buyers, on the other hand, may not even think about such cover.

“It is so important to have insurance in the case of a natural disaster affecting your property,” says Venter. “Damage caused by a fire or flood can be very costly to repair and cash buyers should really be aware of the importance of having adequate insurance cover. Also remember to shop around for the best quote.”

If you have a bond, you could simply accept the building insurance offered by the bank, but you may find a better, more affordable options from another insurance company. Shop around like you would for car insurance, says Venter.

“An estate agent shouldn’t just be a salesperson but should be your partner in the process of finding your home. Have a clear understanding between yourself and your chosen agent as to how your relationship will work. Feel free to settle important questions from the outset such as how your communication should take place – sms, email, phone – and how much time will be needed to arrange viewings of properties,” says Venter. “You are also part of this relationship so the boundaries and decisions agreed upon are your responsibility too.”

Most people end up selling their home one day. So before you buy, think about how others may view your home and if you are likely to sell again easily and if you should spend money on renovating or if that would be overcapitalising. Although the old adage in buying a property is ‘location, location, location’, Venter says buyers should think along the lines of ‘price, accommodation, location’ – in that order, before signing on the dotted line.

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