How to take advantage SA buyer's market for first-time home buyers

Over the last decade, the South African property market has experienced very little growth.

While some areas have experienced a sales boom, most have remained stagnant and experienced little change. There are many reasons for this, from the sluggish economy to political turbulence to higher living costs. South Africans are feeling the pinch and have been hesitant to purchase new homes.

However, we are starting to see a renewed interest in property, as the younger generation look to enter the market, especially in homes under the R2 million mark. This is as a result of South African banks more easily approving 100% loans, providing favourable lending rates and the decrease in property prices; we are also seeing the older generation looking to downsize to smaller, more manageable properties.

2020 is likely to be a year of reshuffling within the SA property market with most of the activity taking place in the 'value-for-money' property price bracket, including sectional title properties and low-cost areas.

Seeff takes a look at some of the opportunities available to first time home buyers as a result of the current market.

Start by gathering information about properties

Whenever you shop for anything, understanding what you’re looking for and what might be available is a good idea.

There are multiple property platforms online where you can browse through listings in the vicinity you’re considering.

This gives you a good idea of property value in the area and what it’s based on - preparing you in advance for meetings with property agents and sellers. There’s nothing wrong with asking the right questions.

Review your finances to establish what you can afford

There are many expenses associated with buying a house. These include everything from the actual price of the property to transactional, legal and maintenance costs, so make sure you crunch the numbers before you sign yourself into financial distress.

Identify what features matter most to you and prioritise them when choosing properties to view

Different areas come with their own pros and cons. Depending on whether you’re looking in a suburb, township, or rural area, property prices will be affected by a variety of factors such as proximity to amenities, safety, among others.

Decide on what you’re willing to compromise on and what you aren’t so that you can filter down your options and refine your search more accurately.

If you don’t have somewhere to live rent-free, buy a home

Unless you’re living comfortably with family, your first property presents an opportunity to build your ideal home the way you want it. You can take the time while paying off the property costs to make additions and adaptations that suit your needs.

Once you’ve made some progress financially, you can start exploring other property investment options and by that time, your additions and renovations will have increased the property value considerably.

Don’t be scared to negotiate the price of a property

Sellers are likely to try their luck by placing property values as high as possible, so don’t just take the first amount you see. Make a reasonable offer to open negotiations so that you can come down to a price that benefits both parties.

While the market has been slow, it is steadily picking up and providing an opportunity for first-time property buyers. Be sure to equip yourself with the right information and real estate agent to ensure that you take full advantage of the current market situation.

Whether you are buying your first home or second property, Seeff can help you find the home that suits your life stage.

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