Looking to buy property in 2025? Yes, you can
Category Newsletter: Lead Article
Buying your first property is always going to be a big deal. It's a significant, long-term commitment but also an investment into one's financial future.
Willem Lottering, property expert and principal at Leapfrog Vereeniging, describes witnessing somebody take ownership for the first time as one of the best feelings in the world. "Not only is it something to aspire to, but also something to be proud of as it requires foresight, hard work and dedication to make it happen for yourself and your family."
And while there's no denying that times are economically tough at the moment, Lottering encourages would-be buyers to still seriously consider buying property, known to be a resilient investment type over the long tem.
"The good news is that the interest rate came down for the second time in November, which always brings relief to existing owners and hope to would-be owners. With due consideration and careful planning, purchasing property could be something you do in 2025," Lottering believes.
Start with A: for affordability
Affordability - literally whether you have enough money to cover the bond each month - is key, and typically calculated by considering your income and expenses against the cost of the property.
Lottering reminds us that costs such as levies, interest and municipal charges must also be taken into account when considering affordability.
Bond originator BetterBond has useful online affordability calculators to easily work out exactly how much you can afford to put towards a bond each month. Play around with it as part of your planning to see where possible shortfalls are.
Additional expenses related to property purchases include:
Bond registration and transfer costs: A once-off cost paid to the conveyancing attorney to register the bond over the title deeds and is related to the loan amount.
Rates, taxes,homeowners association fees and levies: Determined by the value of the property, as well as the size and the area in which the property is located, rates and taxes are unavoidable as they represent the fees payable to the local authorities for waste removal and sewerage, and the tax payable on the value of the property.
Homeowners insurance: This offers financial protection in the case of damage or loss related to the property. Depending on the type of cover you opt for it may include emergency repair services or cover for temporary living arrangements in the event of the property needing to be evacuated. In the case of bonded properties the lender (typically the bank), may require that the homeowner has comprehensive insurance that covers the value of the property.
Maintenance: All properties require a level of upkeep and maintenance and budgeting for this variable expense is a good idea. A well maintained property helps your investment retain - and grow - its value.
Lottering also notes that potential buyers should pay attention to their credit record and score, as this has a direct impact on your ability to secure a home loan. Companies ClearScore offer free credit checks, as well as plenty of useful information and advice on your credit score.
Better with a bond originator
A bond originator, such as BetterBond, assists buyers in getting the best bond at the most favourable interest rate.
"We strongly recommend using a bond originator. They apply to the bank on your behalf and their aim is to get the best rate and loan term, and they take care of the paperwork," says Lottering.
It's a service that's free to the buyer as the bond originator is paid by the bank for bringing in the client.
No such time as the present
Not unlike other big commitments in life, the best time to purchase property is when you make the decision to. "Decide to make it happen for yourself and then work really hard at realising that goal. And get in touch with a trusted property advisor. We can advise and assist you on every step of the journey," Lottering concludes.
Author: Leapfrog Property Group
