Buying a property is a complicated process with many moving parts. Understanding where things might go wrong in this process can help buyers to avoid some of the common pitfalls.
READ: Important red flags in property deals to look out for
According to Adrian Goslett, Regional Director and CEO of RE/MAX of Southern Africa, not working alongside a real estate agent can be a costly mistake for buyers. “A good agent brings expertise, market knowledge, and negotiation skills to the table. They can help guide you through the paperwork, coordinate with other professionals, and support you through the entire process. Their assistance can be invaluable, especially for first-time buyers,” says Goslett.
There are many obstacles in the path towards a successful property transaction and a lot can go wrong between signing an offer to purchase and having the home transferred into your name. To help buyers be better prepared for these potential pitfalls, RE/MAX of Southern Africa shares some of the most common roadblocks.
Being rejected for a home loan
A common mistake is not getting pre-approved for a home loan before starting the home search. Pre-approval gives you a clear idea of what you can afford and reduces the risk of rejection when you officially apply for home finance. There can be a number of reasons why your bond application could be rejected, but most commonly it has to do with your credit score. Also, if you have changed jobs recently (within the last 6 months), or are self-employed, this will also affect your chances of bond approval.
Being unprepared for upfront costs
There are a number of upfront costs that need to be paid before the property can be transferred into the new buyer’s name. This includes transfer duty, transfer fees, bond initiations fees, and other associated costs. Depending on the value of the home, this can add up to a large sum of money.
Skipping a private home inspection
Although this would come at a buyer’s own expense, taking this precaution could save you a lot of money and stress by uncovering all the potential issues with the property before transfer takes place. The compliance certificates that the seller will need to have issued before transfer can occur will cover some of the potential problems, but these won’t reveal all the issues with the home. To make sure you are not caught off guard by hidden problems like structural damage, low water pressure, or roofing issues, it is advisable to hire a contractor to inspect the home beforehand.
Buying a home is a complex process with many potential pitfalls. Goslett says that by being aware of the common issues and taking proactive steps to address them, you can navigate the journey more smoothly and make a decision that brings long-term satisfaction and financial stability.
READ | Looking for a home that ticks all your boxes? Try Property24 Alerts
“Buying a home is a significant life step and major financial commitment and rushing into buying a property can lead to costly regrets and dissatisfaction down the line,” says Cobus Odendaal, CEO of Lew Geffen Sotheby’s International Realty in Johannesburg and Randburg. (Read full article here)
“The key to a successful and fulfilling home-buying experience lies in patience, careful consideration of numerous factors and thinking long-term rather than only fulfilling immediate needs.”
Odendaal says that the following mistakes and omissions can easily lead to regret purchases and unwise investments:
Failing to Define Your Priorities:
One of the most significant mistakes when purchasing a property is failing to clearly define your priorities. It's vital to have a clear understanding of your needs, desires, and deal-breakers before embarking on your home search.
Consider factors such as location, size, layout, amenities, and proximity to work and schools. Create a list of non-negotiables and use it as a guiding compass throughout your property search.
Skipping the Research Phase:
One of the most prevalent errors when seeking a new property is neglecting thorough research and impulsive decisions can lead to mistakes such as selecting a location that doesn't align with your lifestyle or needs.
Prior to committing to a property, take the time to research the neighbourhood, its amenities, proximity to work, schools, and other essential facilities. Visit the area at different times of the day to get a comprehensive understanding of the environment.
Online resources, local forums, and community websites can also provide invaluable insights and help you make an informed decision.
Neglecting Proper Budgeting:
It's crucial to establish a realistic budget that encompasses not only the property price but also additional and future costs such as taxes, insurance, maintenance and potential renovations.
A comprehensive budget ensures that you can comfortably afford the property without compromising your financial stability.
Overlooking Future Growth and Needs:
Consider your future plans and potential life changes when purchasing a property. While the current layout may suit your needs, will it accommodate potential family expansions or lifestyle shifts?
Opting for a property that aligns with your long-term goals can save you from the hassle and costs of relocating sooner than you had planned.
Skipping Home Inspections:
Foregoing a comprehensive home inspection can be a grave error, especially when buying an older home. Hidden issues, such as structural problems, plumbing or electrical concerns, and potential pests, can lead to substantial expenses post-purchase.
Engage a qualified home inspector to thoroughly assess the property's condition, allowing you to make an informed decision based on accurate information.
Succumbing to Emotional Impulses:
Emotions can cloud judgment, especially when purchasing a property. Falling in love with a property's aesthetics without considering practicality and functionality can lead to disappointment in the long run.
Maintain a rational mindset and critically evaluate the property against your predefined criteria.
Overlooking the Fine Print:
Whether you're signing a lease or purchasing a property, reading and comprehending the contract is crucial because ignoring the fine print can lead to unpleasant surprises later on.
Ensure you understand the terms, conditions, and obligations associated with the property. If needed, seek legal advice to clarify any ambiguities or potential pitfalls within the agreement.
Succumbing to Market Pressure:
In competitive real estate markets, it's easy to succumb to pressure and rush into a decision, especially if you know that there are other buyers interested in the same property.
While it's natural to feel a sense of urgency, it's crucial to remain patient and not settle for a property that doesn't meet your requirements. Take your time, explore multiple options, and don't let market dynamics dictate your choices.
Disregarding Resale Value:
Life is full of surprises, and circumstances may change, necessitating a property sale. Neglecting to assess the property's potential resale value and marketability can leave you trapped in a less-than-ideal situation if you need to sell. Research the property's history, growth trends in the area, and potential for appreciation.
Not Seeking Professional Guidance:
Navigating the complexities of the real estate market can be overwhelming and engaging an experienced real estate agent, financial advisor and legal expert can provide invaluable guidance throughout the process. Professionals can offer insights, negotiate on your behalf, and ensure that your interests are protected.
“The path to a successful property purchase is paved with thoughtful consideration and deliberate steps,” says Odendaal.
Avoid the allure of rushing into a decision and take the time to define your priorities, set a realistic budget and thoroughly research the property and its surroundings.
“Remember that a property is not just a purchase; it's an investment in your future and the place in which you raise your family and escape from the hustle and bustle.”
READ: Safety measures to consider when selling and letting homes
Want all the latest property news and curated hot property listings sent directly to your inbox? Register for Property24’s Hot Properties, Lifestyle and Weekly Property Trends newsletters or follow us on Twitter, Instagram or Facebook.
Print
