What to look out for when buying a property
When buying that first home, find one that's a fit for your lifestyle and that gives you loads of room to grow.
Should you look for a tiny townhouse with a lock-up-and-go lifestyle that's just big enough for one (or two at a pinch)? Or should you search for a spacious apartment or sprawling suburban home, so you won't have to move when your family starts to grow, or when you slow down and suddenly discover an interest in gardening?
Our statistics show that the average age of first-time buyers is now around 34, and that would suggest that many, if not most, are planning a lasting commitment to a home with enough bedroom, leg room and garden space to grow a family, and enough living space for easy, at-home entertaining.
And this is borne out by the latest report from property data company Lightstone, which shows that the average life span of home ownership for first-time buyers has stretched from seven years in the early 2000s to 12 years currently.
There are several reasons for this shift: firstly, there's the slower rate of growth in property values since the 2008/09 financial crash, which has made it more difficult to sell homes at a hefty profit within a short period.
On top of this, buying, selling and then buying again can be quite costly and stressful. As well as the transfer duty, legal fees and bond registration costs for a new home, you have to factor in all those hidden costs — like moving, reconnecting utilities and all the time spent on coordinating the move. Other hidden costs can include new school uniforms, increased insurance and extra security.
What's more, it's hard not to become emotionally attached to your first home — all those memories! And so, it's natural to be reluctant to sell, especially if it's the only home your children have known, and one where you've built up strong connections to a community.
But if you want a home that's worth hanging on to, you need to buy right, right from the start. Which can be tricky if you're young and don't yet have a family-sized budget! So, the best place to begin is with the biggest deposit. This will not only improve your chances of being approved for a bond, but could also mean that you qualify for a lower interest rate, especially if you apply through a reputable bond originator like BetterBond, who'll approach SA's major banks to get you the best possible home loan deal.
A lower interest rate means more affordable monthly repayments plus big savings on the total cost of your home over the lifetime of the bond. On, say, a R1m bond taken over 20 years, an interest rate that is just 0.5% lower than the current prime rate of 10% will save you almost R80 000.
Meanwhile, first-time property buyers who would love to settle and stay put for a decade or more should look out for the following features:
- Great basics: Make sure you choose a house that's structurally sound, with the roof, plumbing and electrical systems all in good shape. This will mean big savings on home maintenance, especially in those first few years of ownership. But be prepared to forego luxuries like a pool or lock-up garage at this stage, in exchange for features you need right now, like a sound security system.
- Room to grow: While your first home may be 'cosy', if it's in a good area and there's yard space to add on extra bedrooms and bathrooms as you grow, this may be your ideal property. Well-proportioned rooms and generous ceiling heights are also a plus if you're anticipating alterations at a later stage.
- Energy efficiency: A home that makes use of solar and other renewable energy sources is not only good for the environment but helps make home ownership more affordable by lowering your monthly running costs. Look out for homes with water-saving installations like rainwater tanks and low-flow taps, showers and toilets.
- Good schools: Before you commit, make sure there are good — and affordable! — primary and high schools in your area. Look out for nearby shops to meet your day-to-day needs, medical facilities, places of worship and public transport. And try not to buy in an area that leaves you with a lengthy work commute.
- Manageable gardens: If lawn-mowing and tree-trimming aren't your idea of weekend fun, and you don't have funds for a garden service, steer clear of large, high-maintenance homes on sprawling stands. A smaller yard will cost less to secure and will attract lower rates and taxes.
- Fair levies: Buying a home in a sectional title complex or an estate has its share of advantages — think great security and shared amenities like a pool or a clubhouse. But you'll be liable to pay a monthly levy in addition to your home loan repayment. Find out how much this is and what it covers before you sign!
Being future focused when you buy for the first time could save you a small fortune, and a whole lot of fuss, in the long run.
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