02 Oct 2012
Buying a home is a major investment, so it is vitally important for buyers to take the time to make an informed decision.
This is according to Dot Foster, Broker/Owner of RE/MAX Oaktree, which operates in Stellenbosch and surrounding suburbs, who says despite the fact that buyers are relatively spoilt for choice in today’s market, that doesn’t mean they shouldn’t take their time to do all the necessary homework.
The first thing any prospective home buyer needs to do is enlist the services of a good estate agent to assist in finding the perfect property that meets all the buyer’s criteria. Secondly, the buyer needs to determine what they can afford and whether or not they qualify for a bond.
Currently around 51 percent of all bond applications are being approved by financial institutions, but Foster explains that the buyer can do a great deal to ensure they have a high chance of a successful application. This includes making sure all accounts and tax payments are up to date.
Foster also says buyers can be prequalified for finance before looking for a home. She explains that while prequalification is not a guarantee that the financial institution will grant a bond of that amount for the specific property, it gives buyers a good indication as to what price range they can afford.
The prequalification process will also indicate how much of a deposit a buyer will need to save in order to qualify, and is also a clear indication to estate agents that the buyer is serious, she says.
When budgeting for a home purchase, Foster says buyers should also take into consideration all the costs aside from mortgage prequalification and deposits. These expenses include transfer duties, moving costs, home insurance, the costs of connecting the electricity, telephone, ADSL and television, as well as being able to modify and tweak the new home to meet their individual needs.
When buying a property, there are also a number of things potential buyers need to look into.
According to Foster, the location of a property remains one of the key elements that should influence a buying decision. Therefore she advises buyers to drive around and evaluate various areas in which they would like to purchase a property.
She says things to find out about the top areas of choice would be the level of crime and traffic the area experiences, whether there have been any relatively recent or planned zoning changes in the area, what kind of amenities the area offers and how well these are maintained.
The area’s schools and their quality are also an important aspect to investigate. Potential buyers should take note of the level of maintenance of the road infrastructure and pavements as well.
Adrian Goslett, CEO of RE/MAX of Southern Africa, says everyone knows that over time areas change for the better and for the worse, as such, buyers should ask their estate agent for some statistics on the capital improvement (or decline) of any particular area over the last five or so years.
“This will give the buyer an indication of whether or not the area is a secure investment and whether it has potential for reasonable returns going forward, bearing in mind that property is a long-term investment.”
Another vital factor that buyers should pay close attention to is the state of the property they want to purchase. Determining that the home is structurally sound is very important, says Foster, who also advises that buyers do some checking themselves, especially with fixtures such as the stove, all the lights, the pool pump, the electric gates and the alarm system.
Viewing a selection of homes can become confusing, which is why Foster suggests that before evaluating their final selection, buyers should use a checklist to ensure each property meets their criteria.
Buyers should use the checklist for each property they visit to take notes as they view the house. These notes should include general impressions and specific features they like or dislike and compare these to the features on the checklist to establish how each home compares.
This will help buyers to reach a decision objectively and to make a well-considered choice, instead of simply relying on first impressions or an emotional response, says Foster.
Foster also believes that it is good practice for a buyer to view the property they have chosen once again before making an offer.
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