Buyers who don’t want to worry about running into financial difficulties when economic situations decline should “start small”, advises Deborah Davis, a sales and rental partner for Rawson Properties Green Point.
An example of this is a lock-up-and-go flat in a secure block that can later be used as an investment property once the owner grows out of it. “Affordability is key. Do not overextend yourself and buy into things you cannot afford. Take into consideration the monthly costs that come with buying into sectional title schemes as well.”
Bank approval and the mortgage repayment are only part of the affordability calculation buyers must do to determine whether they can afford to buy, says Jawitz’s Herschel Jawitz.
“Even with a bond grant, buyers must factor in what would happen if interest rates go up in future – by as much as 1% is a good safety margin. Then there are rates and taxes, levies and utilities, including electricity.”
Buyers should also buy smart. The age-old advice of buying in the best position you possibly can is still important, says Lew Geffen Sotheby’s Jill Lloyd.
“Usually, buying the worst and cheapest house in the best street is better than a mansion in a run-down area. Cape Town, in particular, can change in value almost street by street ,and it is important to have an agent who knows the area well to advise you.” She says buyers should also look at the potential of a property.
“Look for a house you can live in for the moment that is probably not perfect, but where there is room to maybe add another bedroom at a later stage when you have a second child, or you can upgrade the kitchen to a stylish one.”
Mariella Peretti, an agent for Greeff Christie’s International Real Estate, says buyers should purchase the “ugly duckling” in the best area they can afford. “You can’t change the area or road you’re in, but you can change your home.”