Are you ready to be a homeowner? Answer these questions and find out.
Category Property Advice
Buying your own home probably seems like a huge step when you're just getting your career started and experiencing independence for the first time. However, there can be huge advantages to paying off your own property rather than paying rent every month. The CSi Property Group has put together a list of questions to help you understand whether or not the time is right to become a homeowner.
Question 1: Do you earn enough money to become a homeowner?
Being a homeowner is more expensive than being a tenant because you have to pay for things like rates, levies (if applicable) and property maintenance - as well as paying for your water and electricity as you would likely do as a tenant.
In the long term, being a homeowner has huge financial benefits. Ultimately, you are paying off an asset that becomes your own, rather than paying rent money to your landlord that goes into paying off their asset. In the short term, however, it's worth thinking about whether your budget and current earnings allow you to become a homeowner.
In a nutshell, if your salary just covers your rent and other expenses, and you would want to buy a property similar to the one you live in now, it may not be the time to buy yet. Similarly, if you have not yet saved up a deposit to put down on the property of your dreams, it may make more sense for you to rent for the time being.
Question 2: Are you settled enough to become a homeowner?
Buying a property is a long-term commitment. Your home loan will usually require you to make payments for 20 years, and it is likely to be at least five to ten years before you could sell your property and hope to make a reasonable return on your investment. Do you plan to be in one place for the next five to ten years? If so, this could be a sign that you're ready to be a homeowner.
Question 3: Are you ready to make a serious commitment?
One of the best things about being a tenant is how easy it is to move on. If you haven't loved where you're living or you get a new opportunity somewhere else, you simply give a month's notice and move out at the end of your lease period, which is typically one year. If you're a homeowner and you need to move suddenly, it becomes a lot more difficult. You will need to put your home on the market and find a buyer, which can often take three to six months or even longer depending on your neighbourhood and other factors.
Have you thought about what the future holds? If your dream is to relocate to another country within the next five to ten years, then renting a property may be the most practical option for you. The same applies if you have a job that is likely to need you to relocate to another part of South Africa.
Question 4: Have you thought about where you want to live?
Even if you know you want to live in Pretoria, as an example, there are plenty of different areas of the city. Unless you're sure you've made the right decision about the specific neighbourhood that you want to live in, it would be better to rent.
If you're financially, emotionally and practically ready to buy a property, then the first step is to get preapproved for a home loan. The CSi Property Group's End User Finance mortgage originator is here to help you with your home loan application. Let us leverage our well-established relationships with South Africa's various banks to get you the best possible deal.
Author: CSi Property Group
