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What you need to know about buying your first home

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By : Alter Sage    99 or more times read
Buying your first home is a very overwhelming prospect for most people. For starters, it's the biggest purchase most people are likely to ever make and is undoubtedly a major financial outlay. Then there are concerns about interest rates, property values and repossessions. All of these concerns are completely justifiable and relevant given the current economic climate. However, if you go into your purchase decision well informed, and choose your new home wisely, there is no need to panic.

One of the best ways to avoid common pitfalls is to be aware of exactly what you're getting yourself into. This includes how much you can afford to borrow, the costs of registering a bond, transfer duty and common checks you should perform on the property you are planning to buy.

Know your budget

Getting yourself pre-approved for a bond can be one of the best things to do when purchasing your first home. This allows you to narrow down your search to properties within your price bracket. There's no point in looking at properties that you can't afford and that aren't suitable.

Having a pre-approved bond will also allow you to calculate roughly what the transfer duty of the property will be as this is determined as a percentage of the sale price. In South Africa, your transfer costs are on a sliding scale. Property under R500,000 is zero percent, up to R1-million is five percent while properties over R1-million are levied at R25,000 plus an additional eight percent of any amount over the million.

You should also be able to calculate the costs of your bond registration. If you are unsure, it is best to speak to your bank or mortgage originator about what these costs will be.

Consider your needs

Before deciding where to buy or what type of property to buy, it is important to consider your needs. Whether you have children, or are you planning to have children in the near future, the length of the commute to work and whether you have pets are all important considerations. You might find a property and fall in love with it - but if it's not near good schools or if it's difficult to reach from your office - you may fall out of love with it in time. You should also think about whether you want a garden, garages and nearby amenities such as shopping centres and schools.

The answers to these questions will help you determine which of the properties you see are the best value for money, and are the most suitable for your circumstances.

Get a good agent

Buying a home is not a particularly involved process. Although the mechanics of it are not that hard, it helps to have a professional to guide and advise you through the steps, especially as a first-time buyer. Using an estate agent can benefit you greatly too as they should have a good idea of property values in specific areas, as well as be able to inform you of what's available.

If you inform an agent of exactly what you're looking for as well as your price range, they will be able to keep an eye on their listings and will let you know as soon as something suitable becomes available.

Don't be afraid to go back again

Once you've seen a property you love, it's often a first impulse to want to leap right in and make an offer. This is completely normal as it is an exciting time. It is also a massive decision and one that should be considered carefully.

For this reason it's advisable to visit a property again before putting in an offer. Visit at a different time of day to see what the light is like. This will also give you a chance to have a better look at the property to see if there was anything you missed in your excitement the first time around. If you do have any concerns, you should express these to the estate agent.

Offer to purchase

Once you've seen a property you want to purchase, the estate agent dealing with the sale will walk you through the offer to purchase. This is your offer for the property. It will contain details of the terms of the offer, the date on which you'd like to take occupancy as well as the purchase price and any occupational rent if applicable. If you are applying for a bond or home loan - the offer to purchase must stipulate that the offer is subject to approval of the loan.

Within the offer to purchase, you should also specify what fixtures and fittings are due to remain in the property and are included in the purchase price. These include things like blinds and curtains, light fittings, fitted appliances, wardrobes and any permanent fixtures. When in doubt, or if there is something you'd particularly like to remain - it's best to check whether such this item will be staying or going with the seller.

Once the seller accepts this offer, it is signed and becomes a deed of sale and a contract that binds both the buyer and the seller to the agreement contained within it.

Getting a bond

Applying for bond approval is a relatively short process - and is often expedited by making use of a mortgage originator who will be able to source the best rates for you. When applying for your first home loan, the general requirements are the basic details of your monthly salary, your credit history and the offer to purchase.

Moving in

Once your loan has been approved, you will register your bond and the property will be transferred into your name by a conveyancing attorney at the Deeds Office. The conveyancing attorney is nominated by the seller, and will contact you when all your documents are ready to be signed. It is also the seller's responsibility to provide the conveyancer with the necessary electrical certificates and certificates verifying that the property is pest-free.

This registration process can take up to 10 weeks in South Africa. However, once the property is transferred into your name at the Deeds Office, you are officially the owner of the property.
Leapfrog Property Group are estate agents in South Africa. They are experts in real estate and property in South Africa. Contact Leapfrog to find out more about buying or selling property in South Africa.

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