select
|

Don’t wait for ‘the one’ before you buy a home

If you’re young and working, you don’t have to wait until you’re in a permanent relationship before you buy your first home.

That’s the advice from Shaun Rademeyer, chief executive of mortgage originator BetterLife Home Loans.

“Young people often argue that they are not sure they will stay long in the same area or the same job, and that the flat or house they buy may not suit a future partner.

“But we believe millennials should be aiming to buy a property of their own as soon as possible. After all, you don’t wait to find the perfect partner before you buy a new car or furniture, or before you decide to take an overseas holiday. And the sooner you stop spending your hard-earned money on rent – which generates no return for you and buys you no asset – the better.”

Indeed, he says, the main aim for young buyers should be to get a foothold in the property market, almost irrespective of the state of the market or the economy at the time.

“Home prices keep rising – in fact they have continued to rise even in the super-slow economy of the past two years – and the longer you wait the more difficult it becomes to afford that first home.”

Rademeyer says the other positive reasons that drive young couples to buy a home should also drive young singles. These include:

*The chance to build up equity and gain economic empowerment. As the value of your home rises and your home loan balance declines, you’ll be building wealth, giving you something to borrow against should you ever need money to start a business, for example, or to pay for further education, or to fund a better retirement.

*Owning an asset to sell or to rent, should you want to. This means that even if a change in your circumstances does prompt a move, you will have a way of raising the deposit on a new home close to your new job or more suited to a new family. Alternatively, the property can be rented out, giving you some income and security while you travel or take a work assignment abroad.

*Gaining independence. Having your own home means not having to share your space – or at least being able to call the shots if your roommates or tenants are too noisy or messy.

As for what type of property to buy, he says many young buyers find the transition to home ownership easier if they buy an apartment or a townhouse.

“Such units usually require less upkeep than freehold homes, and come with built-in neighbours as well as extra facilities in many cases, such as a pool, a gym, entertainment areas and even a laundry or a tennis court. Of course they are also usually much less expensive than freehold homes.”

This is important, Rademeyer says, because young people should only buy properties that they can comfortably afford.

“The calculation of how much they can afford to repay on a home loan must be done very carefully, and must take into account any other financial commitments they have as well as the ongoing costs of home ownership, to ensure they will not be financially over-extended.

“Otherwise the property is likely to become a burden rather than a pleasure, and they could even end up in a foreclosure situation that would leave a black mark on their credit records, and makes any future loan applications or property purchases very difficult.”

Consequently, he says, obtaining mortgage pre-approval through a reputable mortgage originator is an excellent first move, which should be followed by the selection of a qualified, experienced estate agent to help find exactly the right type and size of property.


  Comment on this Article

  Please login to post comments

Post to my facebook wall
  
2000
Characters remaining


    Latest Property News
    • 24 May 2017
      Asrin Property Developers’ luxury apartment development in Tokai is sure to sell out quickly because of its central location and very competitive pricing, says Asrin’s marketing executive Rehana Moosa.
    • 24 May 2017
      An iconic, landmark Art Deco building, 50 on Long Street in the heart of Cape Town CBD, which was recently sold for R37 million in a transaction brokered by Annenberg Property Group, is to undergo a complete interior refurbishment.
    • 24 May 2017
      Consider the following scenario: an ideal investment property is on the market for sale: a three bedroom, two bath, sectional title apartment in a security complex that is clean and in no need of repair. It is located in a good neighbourhood, close to a number of reputable schools and has proximity to the main arterial routes. It should sell like hotcakes. The only problem is that the property has a bad tenant in it who is two months in rental arrears. What can be done?
    • 24 May 2017
      When an annual general meeting (AGM) or special general meeting (SGM) is held in a sectional title scheme, there are certain guidelines that must be followed in order to meet the criteria as set out in the Sectional Title Schemes Management Act, which differ from the way the quorum was calculated in the past
    • 23 May 2017
      While an estate agent typically represents a seller in any residential property transaction, they also act as a liaison between the buyer and seller and work closely with buyers to find them a suitable property and navigate the finance process among other services.
    • 23 May 2017
      For decades, upmarket Bryanston in northern Johannesburg was a quiet haven of small-holdings and expansive homes on large plots spread along leafy, tree-lined streets, but rampant densification in recent years has radically transformed the landscape and pushed the sectional title sector to 43% of residential property in the suburb.
    • 23 May 2017
      Winter seems to have arrived throughout most of South Africa – a time of roaring fireplaces and gas heaters. In some parts of the country, a wet winter can be expected, and in others freezing cold and dry conditions can affect water pipes.
    • 22 May 2017
      There are some features of a home that might not be left behind and are not permanent fittings or fixtures, so it is best to ask for a list of items that remain or mention items of interest before signing the Offer to Purchase
        
    X
    Subscribe to the MyProperty Newsletter

    Name  
    Last Name  
    Email Address  
    Email Frequency
    select
    X
    Share this Page

       
    For Sale Property
    Rental Property
    More Options
    About
    Connect with us
    FEEDBACK