With a total rate cut of 50 basis points expected by the end of 2024 and further reductions likely in 2025, South Africa’s property market could see renewed activity, particularly in regions like Gauteng and the Western Cape, which has already experienced a rebound in recent months. For those in the market for a new home, these shifts present both opportunities and challenges.
READ: Buying: 3 practical tips for house hunters
Antonie Goosen, founder and principal of Meridian Realty, believes that with the right approach, buyers can still find great opportunities despite the evolving landscape.
Goosen highlights that, while the market may appear daunting at first glance, it’s all about being prepared and informed. “House hunting should never be rushed. By understanding your priorities, finances, and the local market dynamics, you’ll be in a much better position to make smart choices,” he advises.
One of the first and most important tips for house hunters is to have a clear understanding of their financial situation. “Before starting the search, it’s essential to know exactly what you can afford,” says Goosen. This means not only securing pre-approval for a bond but also factoring in additional costs like transfer duties, legal fees, and potential renovations. By setting a realistic budget from the outset, buyers can avoid the disappointment of falling in love with properties outside their financial reach.
Location, as always, remains one of the most critical considerations. “The old adage ‘location, location, location’ still holds true,” Goosen points out. Buyers should research areas that align with their lifestyle and work needs, considering factors such as proximity to schools, public transport, and amenities. However, it’s not just about convenience; location also plays a significant role in property value growth. “In an uncertain market, choosing a property in an area with strong growth potential can provide a safety net for future resale value. This makes it crucial to consider the long-term prospects of a neighbourhood rather than just the immediate appeal.
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Understanding the current market dynamics is another vital tip for house hunters. South Africa’s property market has seen fluctuations in recent years, and buyers need to be aware of whether they’re entering a buyer’s or seller’s market. “In a buyer’s market, you have more room to negotiate,” Goosen advises. “In contrast, a seller’s market means properties move quickly, and you may need to act fast.” Being informed about market conditions allows buyers to time their purchases better and make offers with confidence.
Another important aspect is conducting thorough inspections of any potential home. “Don’t rush the process—take the time to inspect the property carefully,” says Goosen. This includes checking for structural issues, plumbing and electrical systems, and even the condition of the roof. Many buyers fall into the trap of focusing on aesthetics, but Goosen stresses the importance of understanding the property’s overall condition. “Cosmetic issues can be fixed, but major structural problems can turn into costly repairs down the line,” he cautions.
READ: Homebuyers: 9 things no-one tells you about owning a home
In today’s digital age, the property search often begins online. While property websites provide a convenient way to browse listings, Goosen advises that house hunters shouldn’t rely solely on digital searches. “Virtual tours and online listings are helpful, but nothing beats seeing the property in person,” he says. In-person visits allow buyers to get a true sense of the space, the surroundings, and any potential red flags that may not be apparent in photographs.
Flexibility is also key when house hunting. “You may have a dream home in mind, but be prepared to compromise on certain features,” Goosen suggests. With limited stock in certain areas, it’s essential to prioritise the must-haves over the nice-to-haves. For some, this might mean opting for a smaller home in a better location or choosing a fixer-upper with the potential to add value over time. “Being adaptable can help you find a property that meets your core needs, even if it doesn’t tick every box on your wish list,” he adds.
Read: First-time homebuyers' fears - how to overcome them
Finally, Goosen emphasises the importance of working with a knowledgeable estate agent. “A good agent knows the local market and can guide you through the entire process,” he explains. An experienced agent can not only help find properties that match a buyer’s criteria but also assist with negotiations and legal paperwork, ensuring the transaction goes smoothly.
In summary, buying a home in South Africa’s current market requires careful planning and informed decision-making. By understanding their finances, researching locations, and staying flexible, house hunters can navigate the challenges of the market and secure a property that meets both their immediate and long-term needs. “With the right approach and a bit of patience, finding the perfect home is achievable,” says Goosen.
In an article published on 11 May 2023, Pam Naidu, Director of Sales and Marketing at Devmco Realty, shared some key learnings which every first-time buyer should know when deciding to purchase their dream home.
1. Location, location, location! Also known as the Three L’s:
There are three micro locations that define the actual location of a property on a macro level. If the property you want to purchase is in an estate for example, you may want to find out what area of the estate it sits in and what that actual area provides, such as a good sea views, etc.
2. Financial stability is important:
Get your credit card payments and debts in order.
3. Budget:
Establish a realistic budget to determine your affordability. Create a budget and try to stick to it so that you can enjoy the process and not put yourself under too much pressure.
4. Find a trustworthy real estate agent:
This is the person that will assist in picking out your potential home and exploring your new neighborhood and is also responsible for scheduling tours and negotiating important contracts on your behalf. Ensure that this is someone you trust, to have your best interests at heart.
5. Get approved:
Get a pre-approval letter before you start shopping! This will help you have realistic expectations on what you can afford.
6. Be mindful of transfer and closing costs:
First time buyers usually tend not to factor these costs in, and it comes as a huge surprise at the end. Doing your homework is a very vital part of house hunting.
Becoming a first-time homeowner can be an overwhelming experience and requires careful consideration of several factors. With the expert advice from Devmco Realty, first-time home buyers can make an informed decision and successfully unlock the door to their dream home.
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