- The very low current interest rate is making buying a property attractive for first-time buyers.
- At the same time, they need to be cautious about buying a property with some hidden problems.
- An insurance expert suggests putting in a relevant clause in the purchase agreement and to use experts to inspect the property for you.
With the SA Reserve Bank's repo rate currently at 3.5% and the prime lending rate in the country at 7%, it has made the property market more accessible to first-time home buyers.
At the same time, it is important to make sure that all damage is fixed before you move into your new home, as a condition of your offer, suggests Marius Steyn, personal lines underwriting manager at Santam.
A purchaser needs to know that a property is structurally sound, safe and damage-free.
Steyn suggests conducting a home inspection prior to purchase, then putting in a clause that an offer to purchase is subject to stipulated repairs. A home buyer is fully entitled to include a home inspection clause in the purchase contract, which makes the offer conditional on a home inspection being conducted and the property being found to be in a satisfactory state.
"Do not purchase a property which has damage. Rather include a clause in the purchase contract that the seller must repair the specified damage before registration can take place," says Steyn.
"Remember, your insurer is only responsible for damages occurring from the date of registration of your new home at the deeds office, onwards – not for any prior problems. This means you need to have any damages fixed by the seller, as a condition of your offer. Otherwise, these could become big issues down-the-line."
Steyn also points out that including such a clause could sometimes make an offer less desirable for a seller – especially if there are things that need fixing.
Therefore, Steyn advises having a professional inspection and taking a family member or friend along, who has experience and knowledge in spotting potential structural problems.
5 things to check
Check the geyser:
Have the geyser inspected by a registered plumber in order to establish the general condition and the adherents to regulatory requirements. The general replacement cost of a standard size geyser amounts to R8 500. When bursting or leaking it has the potential to wreck a room, so you need to be sure you're getting one in tip-top condition.
Check the roof
Have the roof inspected by a registered builder to determine the general condition of the roof. Are any of the tiles cracked, for example. The state of a roof and gutters can indicate a lot about the general maintenance of the home as a whole.
Check the ceiling
Most ceilings have secrets. Look especially for mould, or maybe fresh paint jobs to hide mould or damp.
Check the garden
If this is lush and green, be careful. How much will you need to spend to maintain it? Is it drought-friendly given certain parts of SA's ongoing water issues?
Check for electrical faults
Electrical faults will be identified with the issuing of the electrical certificate, which is the responsibility of the seller. Any repairs or shortcomings identified in this investigation would also be the responsibility of the seller.
Homeowner's insurance covers the building and house contents insurance covers the contents within your home. Steyn suggests obtaining this already a few days before moving in.
"Your first seven days in a new house are when you're most vulnerable, because you're usually still figuring out security and all your things are in boxes. So, make sure your insurance is already in place," says Steyn.
"You can also request to have certain security features installed before moving in – especially those that are essential to meet your insurer's stipulated conditions – like burglar bars and an alarm.
Compiled by Carin Smith