Prequalification very important in home sale

2010-10-16 00:00

WITH the banks still in cautious mode, home sellers should continue to insist on strict buyer pre-qualification by their agents, especially with regard to the funds required to pay a deposit, as well as the hidden costs of property purchase.

Apart from the transfer duty, these transaction costs include valuation fees, bond initiation and registration fees, legal fees, deeds office fees, a portion of local authority rates during the transfer period, connection fees and stamp duties.

The cash required to cover a 10% deposit plus costs would be around R132 000 for an average home costing R850 000.

This is according to Harcourts Africa CEO Richard Gray, who noted that long transfer delays and even cancellation of the sale will occur if the buyer does not already have this cash on hand at the time of purchase.

“Thorough prequalification has become increasingly important, and many savvy property sellers are now making it a condition of any mandate they award.”

Potential buyers, meanwhile, should not resist the process of prequalification, as it provides the opportunity to become fully informed about the total cost of purchase “and, if necessary, to reshape their aspirations without embarrassment”. — WWR.

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