Tips, guidelines for first-time property buyers
The most important tips for first-time property buyers, are to be practical about your finances and to think long term, says an expert.
POLOKWANE – Having the keys to your own home is an achievement that most people aspire to. To make sure home owners know the intricacies of buying a first property, Adv Pat Molope shared some guidance.
Molope is the CEO of the Community Law Centre in Seshego, which assists residents with various legal issues pro bono (free of charge), which include legal disputes relating to property. He is also a member of the South African Property Owners Association (Sapoa) and the South African Black Property Practitioners (SABPP).
Molope says the first thing first-time buyers should keep in mind, is to be practical about their finances and think long term value. “When you buy property, it is important that the property is transferred into your name, and this is called transfer of ownership.” This can take between six weeks to six months, Molope explained. He added that one needs a conveyancer to transfer the property, and the cost depends on the value of the property, but ranges from R25 000 – approximately R20 000 for attorneys’ fees and R5 000 for administration fees and VAT.
“No transfer duty is payable if seller is registered as a VAT vendor, usually this is the case when buying property in a new development where the developer is generally VAT registered,” explained Molepo.
Be cautious if buying a house without a deed of grant, as the same house could be sold to more than 10 buyers fraudulently, he warned.
Tips to consider when buying property:
Use technology wisely
The search for property has evolved and buyers aren’t limited to choices made available by a real estate agent or newspaper. Using online portals can filter searches to find the right home. Be alert as technology can be misleading.Get the right financial advice
Consult a professional to get the right advice about financing the property when you find it. Use bond calculators for an idea of what you can afford. Getting prequalified for a bond gives you a better chance of getting the bond you applied for and saves work and time for when you actually have to apply for a bond. “For people going to banks to get finance for a home loan, I encourage shopping around for the right loan,” said Molepo.
Bond originators are a great resource
Reach out to a mortgage originator for a great return and best rate. Finance is not just sourced for the bond, but includes costs such as administration fees and taxes.
Take a notebook on property viewings
This is so you don’t confuse the details of different properties. You can keep a record of concerns and features of the properties. A real estate agent is compelled to reveal known defects; however, a private seller is not legally compelled to do so.
Checkout all the angles
Consider developments in the area which means investment increasing property value. “Consider factors such as, what the traffic is like getting to and from work, as well as transport network safety,” Molepo added.
Cost of financing a home
The cost of property isn’t limited to the instalments on a bond. Other upfront costs include bank initiation fee before bond is registered at a flat rate of R6 000 across banks, attorney registration fees and multiple attorneys can be involved with separate fees charged for the separate skills required.
Legalities are important
Having a conveyancer is necessary to make sure you have the right contract with conditions in place to protect you.
