Entering the real estate market for the first time can be an exhilarating yet daunting experience, especially in the midst of an election year when uncertainties abound, and many may be considering waiting until after, or be slightly influenced by the elections. As first-time homebuyers embark on this journey, they are confronted with a myriad of challenges and considerations.
From navigating competitive bidding wars to deciphering the impact of political dynamics on the housing market, the path to homeownership can seem fraught with obstacles. “However, armed with the right insights and strategies, first-time buyers can confidently navigate the complexities of a competitive market and make informed decisions that set the stage for a successful and fulfilling homeownership journey,” explains John Herbst, CEO of Fine & Country Sub-Saharan Africa (SSA).
Here are the top five tips to empower first-time home buyers in an election year:
Start with a clear understanding of your needs and budget - Before diving into the house-hunting process, take the time to introspect and define your priorities, preferences, and non-negotiables. Consider factors such as location, size, amenities, and proximity to essential services. Additionally, establish a realistic budget by carefully assessing your financial situation, including savings, income, expenses, and debt obligations. Factor in potential changes in economic policies or taxation that may arise from the election outcomes. By setting clear parameters from the outset, you can streamline your search and focus on properties that align with your lifestyle and financial goals.
Get pre-approved for a home loan and understand your financial ability - In a competitive market, having financing pre-approval in hand can give you a significant advantage over other buyers. Work with a reputable home loan origination company to obtain pre-approval for a bond, which demonstrates to sellers that you are a serious and qualified buyer. Pre-approval not only streamlines the buying process but also provides clarity on your purchasing power, allowing you to confidently make offers within your budgetary constraints, plus a pre-approval is free. Keep in mind that market dynamics may fluctuate in response to election-related economic forecasts, so stay informed and be prepared to adapt your financing strategy accordingly.
Be flexible and act quickly - In a competitive market, speed is of the essence. Properties often receive multiple offers within days of listing, making it crucial to act swiftly when you find a home that meets your criteria. Remain flexible in your approach, be open to compromises, and prioritise your must-haves to avoid missing out on opportunities. Stay engaged with your real estate agent, set up alerts for new listings, and schedule viewings promptly. While market dynamics may experience short-term fluctuations during an election year, maintaining agility and readiness to make decisive decisions can position you as a competitive buyer.
Conduct thorough due diligence - In the excitement of finding a potential dream home, it's easy to overlook critical aspects that could impact your long-term satisfaction and investment. Take the time to conduct comprehensive due diligence on any property you're considering, including inspections, neighborhood research, and evaluation of market comparables. Factor in the potential implications of election-related policies on property values, taxation, and regulatory frameworks. Consult with real estate professionals and legal advisors to ensure that you fully understand the terms of the transaction and any potential risks involved.
Lean on expert guidance - Navigating the complexities of the real estate market can be overwhelming for first-time buyers. That's where experienced professionals come in. Partner with a trusted real estate agent who has in-depth knowledge of the local market and a proven track record of success. An experienced agent can provide invaluable guidance, negotiate on your behalf, and offer insights into election-related market trends and implications.
While the prospect of buying your first home in a competitive market during an election year may seem daunting, it also presents a unique opportunity for growth and empowerment. By following these top five tips and leveraging expert guidance, first-time home buyers can navigate the challenges with confidence, make informed decisions, and embark on their homeownership journey with clarity and peace of mind. “Remember, with the right preparation and mindset, your dream of owning a home can become a reality, regardless of the external factors at play,” says Herbst.
Local Real Estate agents Lara Hamilton Potts and Keith Harrison suggests buyers work with an agent: (read full article here)
“In addition to only using an accountable and experienced Agent/Agency when purchasing a property always consider if you were to resell what are the pros and cons about the potential property. ie. be wary of steep driveways, lots of stairs, and other aspects that may hinder a potential sale further down the road.”
“If you are buying an apartment or sectional title property check the levies and special levies so there are no hidden surprises that will affect you and especially the pet policies," says Hamilton Potts.
Harrison says as this will be the largest purchase you are likely to make, ensure you work with an agent you trust and who listens to you and understands your requirements regarding price and size of property.
"Ensure that the agent will guide you through the purchasing process especially and discuss important aspects such as location, security, schools, access to amenities like hospitals and shopping malls and access to Highways and Airports amongst others," he suggests.
Understand the entire costs of purchasing a property:
"It is important that first time buyers understand the entire costs of purchasing a property particularly that there are bond costs and transfer duty costs which are over and above the actual purchase price," says Richard Anderson of Local Real Estate, Ballito.
“There are differences between purchasing land, an already built property and off plan purchases. The agent should establish the end goal for the buyer to assist with this decision.," he says.
Local Real Estate agent Jake Morgan, says: “Being pre-qualified as a buyer who can afford a certain priced property is a definite advantage. This is a free service so use a trusted originator, as it also saves time on the purchase".
“When buying a ready built home, request the house plans and make sure that they are up to date and approved with an occupational certificate as sometimes renovations have not been approved by the municipality which really complicates the process. This is a vital piece of information.
“If buying for investment purposes, such as a rental property ensure you are purchasing in a popular area and usually less is more, as there is demand for a 2 bed 2-bathroom apartment. Avoid higher priced purchases as this means the rental needs to be higher and it could be a struggle to rent out," says Morgan.
In the meantime Rory Anderson another Local Real Estate agent in Ballito says, many buyers are now leaning towards secure Estates and complexes wanting security and facilities but even within these Estates, location is critical for future growth and resale.
"The properties that see the best returns on investment are those that are not on fence lines, that enjoy lovely outlooks and are also not too far from the entrance gate(s). It is also important for purchasers to think ahead and choose properties that will appeal to a wider market such as a lovely single level property as these will also enjoy faster growth than their counterparts with stairs and no gardens".
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