Offer to purchase question

Andrew001 said:
Totally get you, I was petrified as I knew nothing about them.
I’m not aware of anyone who reviews otps for a fee.
You could try approach a bond attorney or conveyancer, and ask them for advice in return to use them as your attorneys when buying or selling. I’m sure they would be willing.
If not you can send it to me, or perhaps post it here and I can try to see if I can help.
Click to expand...

Thanks for the feedback and offer for assistance. I think the bond attorney is appointed by the bank after the home loan is approved - so not sure I would be able to choose my own to get the OTP reviewed before hand? But I'll see how it goes once I receive the OTP. Hopefully it's all standard and nothing too unsettling in it.
 
Praemon said:
Thanks for the feedback and offer for assistance. I think the bond attorney is appointed by the bank after the home loan is approved - so not sure I would be able to choose my own to get the OTP reviewed before hand? But I'll see how it goes once I receive the OTP. Hopefully it's all standard and nothing too unsettling in it.
Click to expand...
Seller can pick the conveyancer, while the buyer can pick the bond attorney if they are on the banks' approved list
Sometimes you can wombo-combo for extra discounts if the seller isn't fussy but i'd definitely have a conveyancer not appointed directly by the seller look it over if you go that route
 
SauRoNZA said:
I have never paid the asking price for a property.

Always go in lower and push it down. And lower than you actually want to pay so they think they are winning with their counter offer.

Also just be willing to walk away. Magic happens when you have the discipline to do that after making an offer.

Every situation is unique though. The property could be priced right or they need a specific amount to get their own plans rolling so there isn’t always leeway. Most of the time though people overprice expecting a negotiation.

If you know why they are moving it can help. Also helps knowing how long it’s been on the market.
Click to expand...
True.

After I read Ask Outrageously, I learnt how to negotiate. Two decades back I was trained to negotiate for buying second-hand goods when Cash Converters still had a standard, and this book just filled in all the gaps.

The thing to consider is how to come in low without offending the person. How do you test the waters without giving a number.

I did this for my investment property, made a low offer with justification and they took it in the first go. I said offer is X because of Y, Z, etc. They knew it was a fair offer because if they said no, then I would have required them to do more costly repairs.

51XWTzJehxL._SX319_BO1,204,203,200_.jpg
 
Praemon said:
Thanks for the feedback and offer for assistance. I think the bond attorney is appointed by the bank after the home loan is approved - so not sure I would be able to choose my own to get the OTP reviewed before hand? But I'll see how it goes once I receive the OTP. Hopefully it's all standard and nothing too unsettling in it.
Click to expand...
You can pick your own bond attorney. The bank has a list they work with usually. Either way give them a shout. I'm sure they will give some free advice in return for the 25+k they might be getting from you ;)
 
Praemon said:
That's something I worry about - missing something or getting taken for a ride in the OTP. What company could I approach to get an OTP reviewed before signing for a once-off fee? Do most realtors offer something like that, or would I need to approach a legal firm that specializes in property?

And a different question: do you think offering a too low price could damage your chances of negotiation for a property? I want to offer R1.65m for a property being sold at R1.75m, as I feel it's more aligned to the actual value of the property, but don't want it to feel like I'm trying to low-ball the owner with an unfairly low offer which may make further negotiation more difficult.
Click to expand...
It's far better to be called a low-baller than a tyre-kicker. If your research is good enough, you will soon know exactly what the property is worth. Properties prices are not based on emotion and sentiment, and if they are, move on. Likewise if you start feeling an emotional attachment to any specific property, rather have a cold shower, avoid the agent / seller for at least 2 weeks and find something else, because you are about to be ripped off.

Property prices are based on their market value, which is what people in the market are willing to pay for it. An offer is an offer, it means that someone has found the property to be worth a specific amount of money, and is interested enough (and has balls big enough) to enter into an agreement. It may not be the amount that the seller values the property at, but no-one who is serious about selling a property would ever be "offended". If someone is offended then they are being emotional about business, and are wasting your time. Rather move on.
 
Good day myBBers,

I bought my first 3 bedroom property as an investment earlier this year. I'm looking to rent it out towards the end of the year, and go find a smaller place to rent, which will save me some Randelas, which I can gooi back into the bond.

As a hypothetical, let's assume I bought my current property at 95% max of my disposal income. Would I qualify to buy another property in mid 2023, as I now have a salary(more disposable) + new rental income? How do the banks look at salary+rental income to buy more properties?
 
Tjoker said:
Good day myBBers,

I bought my first 3 bedroom property as an investment earlier this year. I'm looking to rent it out towards the end of the year, and go find a smaller place to rent, which will save me some Randelas, which I can gooi back into the bond.

As a hypothetical, let's assume I bought my current property at 95% max of my disposal income. Would I qualify to buy another property in mid 2023, as I now have a salary(more disposable) + new rental income? How do the banks look at salary+rental income to buy more properties?
Click to expand...

If its your first property, the bank will look at R0 incoming rent. Banks work on facts (as in existing rental income).

But it differ from bank to bank
 
Tjoker said:
Good day myBBers,

I bought my first 3 bedroom property as an investment earlier this year. I'm looking to rent it out towards the end of the year, and go find a smaller place to rent, which will save me some Randelas, which I can gooi back into the bond.

As a hypothetical, let's assume I bought my current property at 95% max of my disposal income. Would I qualify to buy another property in mid 2023, as I now have a salary(more disposable) + new rental income? How do the banks look at salary+rental income to buy more properties?
Click to expand...
I've been wondering the same thing.
I discussed an idea of airbnb for a new property with a bond originator and she said it would help to secure a loan. Slightly different situation but don't see why existing rent would not count. Especially if there is a long term lease involved.
 
zerocool2009 said:
If its your first property, the bank will look at R0 incoming rent. Banks work on facts (as in existing rental income).

But it differ from bank to bank
Click to expand...

Related to the question, I got the facts

You need to afford both properties. With no valid rental agreement, and history, fnb will see your rental as R0. (And by history, 3 months incoming payments as rent)

So in short, as I said, you need to prove to them you can afford both (with no tenant) for starters.

If you bought your first place last year, and projecting to buy in 2023 (its a very tall order), except you put loads of capital in, and locking it in to get your debit order down.

And with projected interest rates to raise this year.....

Dont think big, push your existing bond
 
Last edited:
zerocool2009 said:
Related to the question, I got the facts

You need to afford both properties. With no valid rental agreement, and history, fnb will see your rental as R0. (And by history, 3 months incoming payments as rent)

So in short, as I said, you need to prove to them you can afford both (with no tenant) for starters.

If you bought your first place last year, and projecting to buy in 2023 (its a very tall order), except you put loads of capital in, and locking it in to get your debit order down.

And with projected interest rates to raise this year.....

Dont think big, push your existing bond
Click to expand...
My current plan is to still rent out my current property and rent a smaller space. Save up this difference, as well as 3-5 years' worth of bonuses and side hustles, and then just buy the second property cash. Use the second property rental to snowball the existing bond payments.
 
Tjoker said:
My current plan is to still rent out my current property and rent a smaller space. Save up this difference, as well as 3-5 years' worth of bonuses and side hustles, and then just buy the second property cash. Use the second property rental to snowball the existing bond payments.
Click to expand...

Just remember, I can forecast that property prices will go up radically as interest rates goes up (predicted for this year), and that tables changing from buyer to seller!
 
zerocool2009 said:
Just remember, I can forecast that property prices will go up radically as interest rates goes up (predicted for this year), and that tables changing from buyer to seller!
Click to expand...

Except higher interest rates means less people will be able to afford bonds and less buyers. Higher interest rates also means better returns on cash instruments, reducing the appeal of property (from an investment standpoint).
 
Hey all. I just had an offer accepted, and want to include a suspensive clause for a favourable home inspection in the OTP. What length of time is reasonable for this to happen in, as I assume I would have to specify a time frame?
 
Praemon said:
Hey all. I just had an offer accepted, and want to include a suspensive clause for a favourable home inspection in the OTP. What length of time is reasonable for this to happen in, as I assume I would have to specify a time frame?
Click to expand...

a bit late to be adding onto the OTP now...

it would ahve had to be for your cost any way so timeline isn't really an issue.

Unless you mean the buyer of your property wants one? I would give them a week tops.
 
Steamy Tom said:
a bit late to be adding onto the OTP now...

it would ahve had to be for your cost any way so timeline isn't really an issue.

Unless you mean the buyer of your property wants one? I would give them a week tops.
Click to expand...

The OTP hasn't been created or signed yet (I'm the buyer). They've just said they are willing to go ahead with my offer. I spoke to someone at HouseCheck and they said generally 7 days, and also include wording on their website which is helpful ( https://www.housecheck.co.za/pre-purchase-inspection/ ), so will go with that.
 
Praemon said:
The OTP hasn't been created or signed yet (I'm the buyer). They've just said they are willing to go ahead with my offer. I spoke to someone at HouseCheck and they said generally 7 days, and also include wording on their website which is helpful ( https://www.housecheck.co.za/pre-purchase-inspection/ ), so will go with that.
Click to expand...
Lol an offer isn't accepted until it is accepted in writing.
 
Praemon said:
Hey all. I just had an offer accepted, and want to include a suspensive clause for a favourable home inspection in the OTP. What length of time is reasonable for this to happen in, as I assume I would have to specify a time frame?
Click to expand...
"Too late!" she cried
 
Praemon said:
The OTP hasn't been created or signed yet (I'm the buyer). They've just said they are willing to go ahead with my offer. I spoke to someone at HouseCheck and they said generally 7 days, and also include wording on their website which is helpful ( https://www.housecheck.co.za/pre-purchase-inspection/ ), so will go with that.
Click to expand...
Get this https://www.legalwise.co.za/sites/d...-12/WEB CONTRACT OFFER TO PURCHASE DEC 21.pdf
Fill it out, see section 10.
Present to Agent, or seller.
NB: ensure that it expires within 24 hours, even less is better.
 
You must log in or register to reply here.
Back
Top
Sign up to the MyBroadband newsletter
X