Home Buying

[Stillie]

Hi Guys,

My wife and I are looking to buying our 1st home next week.

I recently read http://businesstech.co.za/news/general/78063/a-guide-to-buying-a-home-in-sa-in-2015/ which was a great source of info. One thing we dont have is a deposit. Is a deposit something you HAVE to have? I heard that 1st time buyers can sometimes get a 100% bond? would this include some sort of deposit or am i looking at it all wrong?

Thanks

 

[D3x!]

Hi Guys,

My wife and I are looking to buying our 1st home next week.

I recently read http://businesstech.co.za/news/general/78063/a-guide-to-buying-a-home-in-sa-in-2015/ which was a great source of info. One thing we dont have is a deposit. Is a deposit something you HAVE to have? I heard that 1st time buyers can sometimes get a 100% bond? would this include some sort of deposit or am i looking at it all wrong?

Thanks

you need more than 100% if you have no deposit, there are transfer fee's (if the property is over R600k which no doubt it is) and bond origination fee's.

I believe some people can get lucky and get 108% loans, but it is very slim and would depend on the institution and you.
if you can't afford to save for a deposit you cant afford a house.

 

[Coasti]

if you can't afford to save for a deposit you cant afford a house.

This.

Calculate what your monthly bond payment plus rates and taxes would be, save that for x months until you have 10% of the property value that you are looking at.

 

[Enzo Matrix]

you need more than 100% if you have no deposit, there are transfer fee's (if the property is over R600k which no doubt it is) and bond origination fee's.

I believe some people can get lucky and get 108% loans, but it is very slim and would depend on the institution and you.
if you can't afford to save for a deposit you cant afford a house.

Simply not true

 

[D3x!]

Simply not true

cool bro, you know best. so your average person who can't afford to save but lets say is renting is able to pay at least 25% more than their current rent per month on a house bond at 108% plus rates and taxes, garden maintenance, general maintenance etc?

teach me your ways master.

I take it you are a home owner at the very least?

 

[^^vampire^^]

A deposit would put you at a great advantage. As stated above if you can't save for a deposit you can't afford a house.
Also you need to have a credit history. I put down roughly 15% of the purchase price on my place and got the bond at prime - 0.5%.

A friend I know had no credit history and put down 20% deposit on a bond and they wouldn't give her 100%. Also they gave her prime + 4% which is bloody expensive!

You also need to make sure that you have cash for transfers etc. 5 years ago I bought a place for 900k and all transfers etc came to around 77k. If you buy under R600k the transfer duty doesn't apply. Important to note is that this is only a small portion of all the transfer fees so even buying under 600k can cost a lot in lawyers fees etc. Alternatively you can buy off plan from a developer. All costs are included in the purchase price. I bought a place roughly 2 years ago for R619k and that's all I pay. I got the bond for R619k and all other fees etc are handled by the developer.

You need to make sure you can afford rates/taxes, levies if you are buying in a complex, water, electricity, insurances (building insurance, household contents insurance), and make sure you can save some extra cash each month so that you can do repairs when necessary. Also don't buy at the max of what you can afford as when the repo rate changes then your bond interest rate will change and then you won't be able to afford the repayments - a mistake I see so many people make.

Also make sure you have adequate security (bars, gates, alarm) in the new place BEFORE you move your stuff in. Thieves are always looking around to steal your stuff when you first move in.

 

[Stillie]

if you can't afford to save for a deposit you cant afford a house.

Thanks for this, i agree with you but in my case this is not true, i can afford to save it, just haven't been saving it. Which is going to change. 4 bonuses a year will speed this process up

A deposit would put you at a great advantage. As stated above if you can't save for a deposit you can't afford a house.
Also you need to have a credit history. I put down roughly 15% of the purchase price on my place and got the bond at prime - 0.5%.

A friend I know had no credit history and put down 20% deposit on a bond and they wouldn't give her 100%. Also they gave her prime + 4% which is bloody expensive!

You also need to make sure that you have cash for transfers etc. 5 years ago I bought a place for 900k and all transfers etc came to around 77k. If you buy under R600k the transfer duty doesn't apply. Important to note is that this is only a small portion of all the transfer fees so even buying under 600k can cost a lot in lawyers fees etc. Alternatively you can buy off plan from a developer. All costs are included in the purchase price. I bought a place roughly 2 years ago for R619k and that's all I pay. I got the bond for R619k and all other fees etc are handled by the developer.

You need to make sure you can afford rates/taxes, levies if you are buying in a complex, water, electricity, insurances (building insurance, household contents insurance), and make sure you can save some extra cash each month so that you can do repairs when necessary. Also don't buy at the max of what you can afford as when the repo rate changes then your bond interest rate will change and then you won't be able to afford the repayments - a mistake I see so many people make.

Also make sure you have adequate security (bars, gates, alarm) in the new place BEFORE you move your stuff in. Thieves are always looking around to steal your stuff when you first move in.

Thanks this was a great help! Would waiting for when its a buyers market be a must(if you can afford to pay it) a possible 8 - 10yrs or should i just bite the bullet and do it now, if i could afford that too?

Thanks for all the responses, wait to hear other opinions

 

[czc]

Apparently Standard bank is giving 100% loans again.

 

[Enzo Matrix]

cool bro, you know best. so your average person who can't afford to save but lets say is renting is able to pay at least 25% more than their current rent per month on a house bond at 108% plus rates and taxes, garden maintenance, general maintenance etc?

teach me your ways master.

I take it you are a home owner at the very least?

A deposit is great, but if you dont have it saved up it doesnt mean u cant afford the monthly. But i can take it from your demeanor that you wont be convinced otherwise and will talk down to anyone who does.

I bought a house with a deposit because i had the funds. I could have also got a 105% bond at the time, which im sure isnt that easy nowadays. But just because u cant put a deposit down doesnt mean u can get that first house, and scrape by for a year.

 

[D3x!]

Thanks for this, i agree with you but in my case this is not true, i can afford to save it, just haven't been saving it. Which is going to change. 4 bonuses a year will speed this process up



Thanks this was a great help! Would waiting for when its a buyers market be a must(if you can afford to pay it) a possible 8 - 10yrs or should i just bite the bullet and do it now, if i could afford that too?

Thanks for all the responses, wait to hear other opinions

on waiting for a buyers market, are you currently renting? if so then waiting is like saying waiting for the right time for a baby, there will always be something, just do it.

If you are living with other and sharing rent maybe then sure wait.

 

[D3x!]

A deposit is great, but if you dont have it saved up it doesnt mean u cant afford the monthly. But i can take it from your demeanor that you wont be convinced otherwise and will talk down to anyone who does.

I bought a house with a deposit because i had the funds. I could have also got a 105% bond at the time, which im sure isnt that easy nowadays. But just because u cant put a deposit down doesnt mean u can get that first house, and scrape by for a year.

so you argue for something you have no experience in, cool story bro

 

[Enzo Matrix]

so you argue for something you have no experience in, cool story bro

Retarded reply, as i expected. One can work out what the bond would be monthly less the x% deposit one pays or doesnt pay upfront. But thats clearly rocket science to you. The OP can work out if he can afford it or not.

Your blanket statement of saying you cant afford a house if u cant pay deposit isnt true. Im out.

 

[D3x!]

Retarded reply, as i expected. One can work out what the bond would be monthly less the x% deposit one pays or doesnt pay upfront. But thats clearly rocket science to you. The OP can work out if he can afford it or not.

Your blanket statement of saying you cant afford a house if u cant pay deposit isnt true. Im out.

cool story bro you are my idol.

 

[Jweb_@@]

Simply not true

I agree. Rent is insane these days. Depending on the area, you might find that your bond repayment will actually be cheaper than the rent.

 

[Napalm2880]

Some tips from my recent nightmare house purchase.

1. Get the approved plans up front. If they don't have them, make sure that it's a clause in the Offer to Purchase (and make sure you give them a deadline to provide the plans otherwise it's not really binding)
2. Make sure that you get the 'extended' rates figures from the council. The council will issue a Rates Clearance Certificate even if there are debts older than two years.
3. Make sure the seller is not so heavily in debt with the bank that their bond exceeds the sale value of the property. YES, this happened to me and delayed the transfer by months as we had to wait for the seller's bank to accept an acknowledgement of debt from the seller.
4. Make sure there is water pressure in the taps when first visiting the house.
5. Check for damp.
6. Make sure you list the fixtures you want to receive 'in working order' in the Offer to purchase. Gates, Garage door, Geyser, Oven, Stove. etc.
7. Make sure there is sufficient parking.
8. Go for a house which has as much privacy as possible and check out what the neighbors are like. ie. you don't want to move next door to a bunch of students.
9. TAKE PICTURES when viewing the house.
10. Buy the cheapest house in the best area.

 

[Hamster]

I agree. Rent is insane these days. Depending on the area, you might find that your bond repayment will actually be cheaper than the rent.

Heavily depends on area (I believe Cape Town is very expensive to rent). As for JHB, well I live in the North in a very good/secure complex. If I had to buy the place I rent I can immediately add R3000k pm for bond costs (assuming I have no deposit). Then there is levies, utilities, property tax, insurance (if not covered by levy), interior maintenance. Can easily end up being close to double what I'm paying for rent.

Regarding the comment that you cannot buy if you cannot save for a deposit - no true, as it is possible. But you'll most likely overextend yourself. If you pay R8k pm for rent and want to buy a place without a deposit you should be looking at something you can afford comfortably, like R6k pm bond. Basically, if you can't save for a deposit you probably shouldn't be buying (in JHB anyway).

 

[Stillie]

Is there any bonus when being 1st time buyer?

 

[Stillie]

Some tips from my recent nightmare house purchase.

1. Get the approved plans up front. If they don't have them, make sure that it's a clause in the Offer to Purchase (and make sure you give them a deadline to provide the plans otherwise it's not really binding)
2. Make sure that you get the 'extended' rates figures from the council. The council will issue a Rates Clearance Certificate even if there are debts older than two years.
3. Make sure the seller is not so heavily in debt with the bank that their bond exceeds the sale value of the property. YES, this happened to me and delayed the transfer by months as we had to wait for the seller's bank to accept an acknowledgement of debt from the seller.
4. Make sure there is water pressure in the taps when first visiting the house.
5. Check for damp.
6. Make sure you list the fixtures you want to receive 'in working order' in the Offer to purchase. Gates, Garage door, Geyser, Oven, Stove. etc.
7. Make sure there is sufficient parking.
8. Go for a house which has as much privacy as possible and check out what the neighbors are like. ie. you don't want to move next door to a bunch of students.
9. TAKE PICTURES when viewing the house.
10. Buy the cheapest house in the best area.

thanks for this! this is very helpful! didnt think of some of these

 

[D3x!]

Is there any bonus when being 1st time buyer?

no.

 

[scudsucker]

Simply not true

Simply not true, but so close to the truth that it makes no difference.