Note These Pitfalls When Buying

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31 Dec 2008

Now that the overseas and upcountry visitors are once again much in evidence all over Cape Town, the Cape Peninsula and further afield, the traditional estate agency tactic of trying to lure some of them into buying property here is once again apparent.

Lanice Steward, MD of Anne Porter Knight Frank, warns that it is very easy for out-of-town people and those accustomed to different real estate marketing practices to find themselves completely at sea when dealing with a local agent.

"The first pitfall to avoid is being talked into to accepting an unrealistic price. People from as near as Paarl and Worcester have fallen into this trap - so you can imagine how difficult it is for those who come from further afield to assess the real current market value of a property."

It can, said Steward, be helpful to insist on the agent drawing up a list of similar properties recently sold or still on the market so that the potential buyer can compare prices. However, she warned, even this can be misleading because it is only seldom that the buyer is genuinely comparing apples with apples.

It is quite possible, she said, for an agent, without any conscious intention of cheating, to select only those properties which are slightly better than the one he is selling, giving the misleading idea that the property is in fact competitively priced.

Then, too, said Steward, out-of-towners can easily be led to believe that this or that area is up and coming, i.e. has some of the fastest growing values in the area.

"In many cases this is a very good reason for buying. However, it is quite clear that some agents have got their predictions wrong and have recommended areas in which no boom has subsequently taken place."

Another mistake made by non-Capetonians, said Steward, is to team up with small freelance operators, many of whom have minimal experience in property and may in fact be fly-by-nights. Some, she said, do not even have their Fidelity Fund Certificates or any stock of their own.

"Here, the tactic is often to interest the client in another agent's property and then, having done none of the paper work or any of the canvassing for the property, to insist on being paid half the commission if and when it sells."

Steward's advice, therefore, is never to deal with an agent who does not have the now obligatory educational qualifications or the Fidelity Fund Certificate.

"In the end, it always pays to do your own investigations of the market. Take the trouble to consult other agencies and other experts on prices and price movements. Look at what is happening in adjacent areas and make sure that your agent has given you a comprehensive picture of what is taking place in the area you favour."

The sort of questions that should be asked, she said, are, are any road works or road changes planned, what possible developments could follow and how serious crime is in this area.

For more information contact Lanice Steward on 021 671 9120 or send an email.

Related articles
  • Beware of these agents.

  • Take the heat out of property deals.

  • Check this list before buying home.

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