In times of economic uncertainty, high value property opportunities tend to become more available, says Harcourts Africa Richard Gray. It is easy, though, to become confused and unnecessarily wary of buying a home with waves of negativity washing over you at such times.
What buyers of distressed sellers may not know is they are offered up to 100% on bonds and 50% discounts off both transfer costs and registration fees (terms and conditions apply per bank). Not in all cases, he says, but certainly a lot. How buyers can take advantage of these deals is when the conclusive Offer to Purchase is submitted to the relevant bank, that particular bank which has the right of first refusal, will ascertain if the buyer qualifies for these benefits.
Planning to buy a home usually takes a long term strategy, with many buyers having to either save for a deposit, assess affordability or scout for the perfect property to call home. Then when the time finally comes and the country’s economy seems to be unstable – interest rates are higher, banks are implementing stricter lending criteria, doomsayers are warning against long term investments, buyers could be caught in a funnel of information.
Gray advises prospective home buyers that the local property market has shown relative resistance to economic instability and buyers continue identifying opportunities. The first thing they need to know is that if you can afford to buy, you’ve done your research, located a reputable agent, then this is the best time.
Ooba, South Africa’s leading bond originator, reported that in January of this year, 54% of applications received were that of first time buyers and with a home loan approval rate of 73% during that month, property remains attractive. Which proves that buyers are still interested despite market fluctuations.
Opportunities for buyers present themselves in all sorts of places. For example agencies like Harcourts, who are on all four banks’ distressed sales panels, can introduce buyers to sellers who are selling their properties under the bank distressed sales programmes. These are normally realistically priced and the banks provide some incentives to buyers.
Other opportunities seemingly resistant to economic downturn have been in the affordable sector. If you’re thinking of buying a second home to let, and your affordability calculations are conservative, divulge your plans to your agent and keep an eye on properties in affordable communities.
There are many prospects in the market. If you play open cards with your agent and have taken the time to carefully select an agency then this market can prove to be a great opportunity for a long term investment.
To take note of though, the fundamentals apply across the board, no matter what the economic pressures are. Do your research. It is crucially important to keep an eye on property sales and listings in your areas of interest to take note of prices, trends and successful agents. Laying this foundation provides you with relevant information that will assist you in determining your affordability, community of choice, nearest amenities and which agent to pair with.