If you’re in the property market or thinking about buying your first home, you should be considering a number of things to help save you money and protect your investment.
If you’re considering buying a property at any time in the next two to three years, the time to start saving for a deposit is right now.
This is according to Careen McKinon, ooba Western Cape provincial sales manager, who says it’s always easy to start the new year with good intentions, but, it’s also just as easy to lose determination as the year gets underway.
She says property is an ongoing commitment, so whether you’re a buyer, owner or seller, make sure you stick to your property resolutions.
McKinon says these should be your top resolutions for 2014:
1. Start saving for a deposit
If you’re considering buying a property at any time in the next two to three years, the time to start saving for a deposit is right now.
“Having a deposit increases your chances of securing a home loan and a better interest rate. So if you’re even just starting to think about buying a home, this is the first and most important step you should take.”
2. Pay more into your bond
Aim to pay a little (or a lot) more into your bond than your specified monthly repayment.
McKinon says paying extra into your bond reduces the interest that you have to pay. She says even just a few extra hundred rands can shave years off the term of your bond and thousands off the amount that you end up paying.
Once-off lump sums like inheritances or bonuses will also significantly reduce the amount you end up paying back, if you put them into your bond account.
3. Negotiate on your interest rate with your bank
Even a small reduction in your interest rate will have a massive impact on the amount of money you pay into your bond.
If you have a good track record of bond repayment over a few years, speak with your bank manager about reducing your interest rate, suggests McKinon.
She says the answer might be no this time, but find out when you can approach them again.
4. Fix those niggling repairs needed around the house
“A house is an investment just like any other. To protect your investment, you should keep it in the best condition possible. This is particularly relevant if you’re planning on selling at some point in the future.”
Keep the interior and exterior paintwork fresh, fix any electric, plumbing or structural problems as soon as they come up, pay attention to rising damp and leaky roofs and make sure that the garden or exterior spaces are maintained.
5. Revise your insurance policy
Check with your homeowner’s insurance broker to find out whether you are covered for the current value of your property and update it if necessary.
McKinon says the point of insurance is that it’s there when you need it, and if you are underinsured, you could come up short if any unexpected damage were to befall your property. This is why it’s so important to keep the insured value up to date, she says.
Remember to disclose any renovations or alterations when you are discussing your insurance with your broker.
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