The residential sector has been thriving, supported by factors like a rapidly growing middle class. This has seen an increase in disposable income, allowing more people to afford to buy their own homes. Owning a home is the ultimate dream for many, and affordable housing is the solution for those who cannot build for themselves due to varying factors. It helps that there’s renewed focus on affordable housing from both public and private sectors. With that said, buying a house is exciting, but one should keep in mind that it is a long-term investment. The road to the dream is paved with many potential mistakes, but these can be avoided if the process is approached with caution.
Here are seven potential land mines first-time home-buyers should aim to sidestep.
1. Making a trade-off between address and functionality
As much as getting a piece of real estate within the ‘right’ address or neighbourhood is recommended, this should not be a priority. Many people lose sight of getting value for money just to own a house in a neighbourhood they’d want their friends to know about. To avoid the blind allure of crowd choices, list what your ideal home should be like, as well as the ideal location – but prioritise getting value for your money.
2. Banking on planned infrastructure
Many real estate agents sell property on the basis of a ‘Government-promised’ access road to the tarmac. Implementation of such infrastructure projects takes a considerable amount of time. Weigh if the benefits of the promise are worth the wait.
3. Following the crowd blindly
Unfortunately, some people choose where to live based on where people of their community or economic class tend to gravitate towards. Considering that the house you buy could end up being your lifetime residence, plan your purchase with what matters to you in mind. The important things could be proximity to your workplace, your family, or amenities like schools, hospitals and police stations.
4. Not checking the credibility of the developer
Does your developer have a track record of quality finishes or finishing in time if you’re buying off-plan? Make a point of visiting the developer’s previous houses or apartments to assess the quality of work and maintenance of communal areas once the project is done. This will give you a clearer idea of the actual product and answer questions, such as whether the developer takes up the role of facilities management.
5. Ignoring the other costs of the house
The devil is in the details. One should always keep in mind that there are other costs in addition to the buying price. These include legal fees, stamp duty, maintenance costs and service charges, which more often than not are largely dependent on the neighbourhood and type of project built. Ensure you understand how much other developments in the area cost, and whether the deal you’re considering is too expensive or is in tandem with the market average.
6. Future functionality
What do you hope the size of your family will be in five years’ time. Will you need to move into a bigger house? Will the children move out and leave you with a nearly empty five-bedroom house? Is it a house you can comfortably grow old in? These are important to think about. For instance, for a couple approaching retirement and whose children no longer need to live in their parents’ house, would getting a three-bedroom villa with two domestic servants’ quarters (DSQs) work better than a five-bedroom house? With the first option, the DSQs can be let out or used to accommodate guests.
7. Ignoring zoning regulations
When investing in a home, conduct thorough land-use due diligence for the area. What are the possibilities that the face of the area will change in the future? If it’s a low-rise designated area, are the regulations strict or controlled enough? Are there upcoming high-rise buildings that have been approved? As a first-time buyer, chances are that you’re more susceptible to hidden mistakes that could be financially and emotionally expensive. However, as tedious as the process can be, you must continuously educate yourself to remain in the know. Talking to real estate experts and reading research reports would help. Additionally, before parting with your money, ensure that you are financially stable to make the purchase. To avoid future financial constraints, budget and get your finances in order first and then identify a home based on the budget – not the other way round. For mortgage buyers, ensure you understand the size of mortgage you are eligible for from your financier. A mortgage is reliant on factors like the size of your income and the house deposit. More importantly, understand the repayment plan, which is also determined by your age and current interest rates.
Source: Read more at: https://www.standardmedia.co.ke/article/2001252278/property-ownership-seven-mistakes-to-avoid-when-buying-your-first-home