Wondering if it may be time to buy your first home? Here are a few tips to think about before you get started.
"Think of the amount that your bond originator suggests you can afford as a range. There is a high end and a low end and it is your job – not the originator’s – to figure out what you are comfortable paying each month," says Elaine Chetty.Seeff Richard’s Bay MD Elaine Chetty says: “As I approach my 18th year as a homeowner, I decided to take a moment to reflect on all that I had on my mind as my husband and I prepared to make the biggest investment of our lives.”
Chetty shares what she wishes she’d known sooner in the journey to homeownership:
1. You don’t pay the agent’s commission as the buyer
So many first-time buyers wonder, “Do you have to pay a real estate agent if you are buying a home?”. For some, the thought of having to fork out extra cash when they are already doing all they can to save for their deposit is enough to make them walk away from the entire process before they even get going.
Many are surprised to find out that the answer is actually “no”. A home buyer does not pay their agent, rather the agent earns their commission from the seller side of the transaction.
2. Focus on your monthly bond payment, not the entire thing
Getting pre-approved for a bond is generally the first step you should take as a first-time buyer. A common mistake that people often make is focusing on the total price of the home they can afford instead of the monthly payment that they will be making.
You may get approved for a R1.5 million home – but this may not necessarily be what you can truly afford. Think of the amount that your bond originator suggests you can afford as a range. There is a high end and a low end and it is your job – not the originator’s – to figure out what you are comfortable paying each month. It is crucial that you work with your originator to understand how your deposit amount, credit, and the current interest rate affect your monthly payment.
Try the Affordability Calculator to find out what you can afford.
Try the Bond Calculator to see additional costs and how much you need to earn to buy your dream home.
3. Make the jump
To steal a line from Nike … “Just Do It!”. From agonising over the down payment to finding the ‘perfect’ home, there are a ton of moments in the first-time buying process that are going to make you feel nervous. Know that this is natural and that similar to having a baby, there is never really the perfect time. You are always going to wish you had more money in the bank, hope that the home had a backyard that was just a little bigger, or that you were just a little more sure what direction your life will be taking in the next 5-10 years.
Getty says her advice is: “If you feel comfortable with the payment, love the location and ‘feel’ of the house, and will feel proud to make this house a home, then take the leap and don’t look back. That’s what we did 18 years ago – and it was one of the best decisions we ever made.”
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