Buying your first property can be overwhelming . Before you sign your first property deal , your mind may be reeling with questions :
“ Is it a good investment ?” “ Will the area stay nice ?” “ Will I find good tenants ?” “ Can I afford the loan ?” or “ Will the banks even grant me a loan ?!”
And you know what ? It ’ s completely normal to feel like this because it ’ s a big decision ! So , to help you in the right direction , we have compiled our top 10 tips for first-time home buyers and new property investors .
1
Small Action is
Better than no Action You will get BIG results when you continuously take the correct small steps !
• Start by educating yourself !
• View as many properties as possible before submitting an offer to purchase ( OTP ) because the more properties you view and the more homework you do , the better you will be able to determine if a property purchase will be good or not .
• Don ’ t buy on impulse — one of the biggest mistakes new property buyers make is buying impulsively or emotionally .
2
Have Cash Reserves
Cash is king , and you need cash reserves for the transfer fees and bond registration costs when buying a property .
3
• If you do not get a 100 % bank loan , you will need cash reserves for a deposit .
• You ’ ll also want some cash reserves for emergencies because it is game over if you run out of cash reserves . You can lose everything you ’ ve built up - as simple as that .
• Ensure you have some cash reserves available after acquiring the property in case of emergency .
Improve your Credit Score If you want to finance a property , you need a good credit record .
• Although it is noble to have no personal debt , it is a disadvantage when you want to finance a property .
• You need credit to get credit , so start with a small credit card , overdraft , and a clothing account or two .
• Remember to check your credit score annually . The better your score , the better financing you ’ ll get .
SA Real Estate Investor Magazine FEB 2022 27