5 top tips for buyers
Talk to reputable estate agents
Buying fixed property or immovable property is likely to be the largest investment an individual will make in a lifetime and therefore the importance of taking sufficient care with the process cannot be overstated. When you’re doing your research, talk to reputable agents in the area(s) that you’re considering, as they will be able to give you good insights into any investment, rental yield or lifestyle questions you may have.
Read the agreement of sale carefully
The Offer to Purchase (OTP), which becomes the agreement of sale once signed, can be a fairly lengthy document. It is essential to read all the terms carefully, and to ask questions if there is any uncertainty to ensure that you understand your obligations and rights under the contract. This is where you can draw on the expertise of conveyancing attorneys who will be able to assist in unpacking the detail of such a contract.
Do a thorough property inspection
Going into a property sale with your eyes open is essential in making a good investment decision. Knowing all the details of the condition and maintenance requirements of a property is vital to being able to make a reasonable offer. This is why conducting a thorough property inspection should be an essential part of the process in order to identify any defaults that may require the seller’s attention prior to the sale, as most properties are sold voetstoots, or ‘as is’.
Be sure about your finances
It is important to have a clear understanding of what you can afford before going to property viewings or contemplating making an offer. This can help narrow your property search and will also ensure that you are able to afford the necessary repayments should your bond be granted. To determine your affordability, use our calculator or engage a reputable financial institution or mortgage originator to guide you on the costs involved and how to calculate your monthly repayment affordability.
Provide all information and payments on time
There are many potential reasons for delays in the property registration process. Some of these may be out of the control of the parties to the sale, however some can be easily avoided. When it comes to required documentation and payments, ensure that all relevant information is sent to the transferring attorneys timeously and that funds are available to make payment within the timeframe requested.
Avoid these common mistakes
Losing out due to lack of finance
Understand your affordability in the bank’s eyes well ahead of time through a financial institution or mortgage originator. Without clear knowledge of your affordability, or better yet a pre-approval from a bank, you may lose out on buying the property you’ve fallen in love with as a bond application may take time and your offer may lapse, or your application may be unsuccessful.
No matter how well organised and planned a property sale may be, there is always the potential for unforeseen issues to creep in. While some may seem insurmountable, discussing these with the estate agent as soon as they arise will give you the best chance of resolving them amicably.
Complications with compliance certificates
Compliance certificates are not only an essential part of a property transfer, but also provide valuable information to the buyer ahead of registration. Insist upon receiving the necessary compliance certificates ahead of time to ensure the property is safe and in good working order.
A signed OTP is legally binding
An offer to purchase, once signed by both seller and purchaser is a legally binding contract, meaning that both parties to the contract are bound by the terms and are required to fulfill their responsibilities. Failing to adhere to the terms of an OTP, or attempting to cancel it once signed without any legal cause, amounts to breach of contract, allowing the other party to claim for damages or enforcing specific performance in terms of the contract. Think carefully before you sign.
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