While married couples still represent a large percentage of first-time
buyers in the market, there is a growing number of people who are flying solo
and purchasing as singles.
Adrian Goslett, regional director and CEO of RE/MAX of Southern Africa,
says that although buying a home as a sole owner may seem daunting at first, it
can actually be an extremely good financial move if done correctly.
Goslett provides a few tips to make the solo house hunt and property
investment a success:
Stay within your budget
For most, buying a home will likely be the largest financial purchase
they will ever make and it is a great long-term investment. However,
before anything else, it is vital to work out an affordable budget and stay
within those limits. When deciding what is affordable, it is imperative to
consider all recurring monthly expenses such as home maintenance and
repairs.
According to Goslett, another important aspect of budgeting is
determining what can be put aside in a contingency fund in case of
emergency.
“Considering there will only be one person responsible for the bond
repayment, there needs to be enough money put away to counter any unexpected
circumstances or loss of income,” says Goslett.
An additional factor to consider is that as a solo buyer the budget is
likely to smaller budget than for a couple who can join their savings and
income, therefore solo buyers will need to be smart with their money.
Be smart and save beforehand
Goslett says that in today’s market most buyers will be required to have
a deposit of between 10% and 25% of the purchase price of the property. “It is
advisable to have at least a 10% deposit saved up, along with enough money to
cover all the other costs associated with buying a home. These costs include
transfer duty, attorney fees, home insurance and bond costs,” advises
Goslett.
Choose the right home for you
Buyers’ future plans will largely determine the type of home that will
suit them best. “Are you looking for a home with the potential to add-on or
merely a small starter home that can be rented out in the future? The answer to
these questions will help buyers narrow down their search and pinpoint the
right property to meet their needs,” says Goslett.
He adds that a sectional title property would mean less maintenance and
possibly a lower bond repayment; however there will be the cost of the levies
to consider, as well as the rules and regulations of the body corporate. A freehold
home would offer the buyer the freedom to do what they want with their home,
but it could be less secure and more expensive to maintain.
Be realistic
The reality is that purchasing a property on your own you may need to
compromise on certain aspects and features. “Ideally it is advisable to look at
location before the property itself. A property can be renovated or changed,
but where it is situated cannot. It is important to research the areas that are
within the budget and then work from there. Buying in a better area might mean
purchasing a smaller home, however it will be a wiser investment that will see
greater returns over the long term,” advises Goslett.
Determine the reason for the purchase
Is the home to live in or is it for investment purposes? This answer to
this question will have a huge bearing on the decision-making process. If the
home is being purchased as a primary residence, the motives and reasoning
behind the decisions that are made will be far more emotionally driven. “If the
home is for investment purposes, decisions will be made solely on research and
logic. The buyer will need to purchase in an area that will attract tenants,
which is within proximity to public transport, amenities and schools,” says
Goslett.
If needed, ask for help
Purchasing a home
solo doesn’t mean that every decision has to be made alone. Family and friends
who have purchased a property can act as a soundboard, providing honest and
objective feedback. A reputable, experienced real estate professional can also
be a valuable asset, providing guidance and advice through the home buying
process. Agents will be able to provide information regarding the suburbs they
work in, as well as the best properties to suit both the buyer’s lifestyle and
budget. “While going it alone can be overwhelming at times, purchasing a home
solo should also be an exciting time. It provides buyers an opportunity to make
their own decisions and choose a home that they really want to buy,” Goslett
concludes.
