Buy in Haste, repent in leisure

Buy in Haste, repent in leisure

International research shows people spend more time deciding on computers & holidays than homes.

A home is one of the biggest purchases most of us will ever make and yet many of us rush into the buying decision only to regret it later on.

"After years of buyers making snap decisions in a sellers' market, conditions now favour buyers so they should take their time and make certain that they really know what they are buying.

"The more information you have, the more confident you can be," says Saul Geffen, Chief Executive of MortgageSA, South Africa?s leading bond originator that places one in five South Africans in their homes.

"In 2004, people often had moments to make up their minds such was the buying fervour at the time. But when making such a massive emotional and financial commitment, people need to consider more than just the property.

"Looking at local amenities, neighbours and assessing the new work commute for example is all equally important." Research by Abbey, the UK building society, shows the average time a buyer spends viewing homes in the UK before putting in an offer is just 96 minutes, 43 minutes less than people typically spend deciding where to go on holiday or what computer to buy. As a result, it says, 49 per cent of house buyers then experience a problem - anything from noisy neighbours to showers malfunctioning because of low water pressure - which could have been avoided had they spent more time researching the property.

"This is a function of this year's strong property market across much of the UK. It has forced the would-be buyer to take short cuts.

"We saw this kind of behaviour in South Africa a couple of years back and in fact still see it in certain areas than have remained hot despite the cooling in rate of growth in the overall market. "We often hear of stories of people that have their approved mortgage and generally appear on the doorstep of an available property as soon as they get the word from agents very eager to buy.

Geffen notes that it is more important than ever for buyers to get beyond superficial details and hearsay and see what a property is really like.

"Websites like propertygenie.co.za are a great resource to get a good overview of what is on offer and compare and contrast prices in different neighbourhoods.

"Buyers must also ask for the sale history find out how long it has it been on sale and if there have been any offers." It's a good idea to prepare questions and your own list of minimum requirements.

"Work out how many bedrooms you want. Imagine how you would use the place yourself and see where key pieces of your furniture might go.

"Go back to a property at different times and different days to see what it's like. Don't be seduced by a lick of paint. Tap the walls to ensure there isn't damp or poor plasterwork. Look for tell-tale signs like moss on the patio which means it's damp or doesn't get sun."

Geffen also advises potential buyers to watch out for sellers' tactics to mask less desirable aspects of a property. These include keeping a buyer talking as they climb stairs to a flat in a block without a lift to distract the purchaser from the hike up; some sellers also keep lights on in a house in the daytime.

"That probably means the place is dark, so turn out the lights and see," says Geffen.

Hello ooba news

ooba (formerly MortgageSA) welcomed the 0.5% interest rate cut announced yesterday by the South African Reserve Bank which will save South African home owners an estimated R259m in home loan repayments each month, but says more cuts are needed.

According to a new poll by South Africa's leading property listings website, nearly a third of home hunters decide that a property is right for them before they even enter the house - and a kitchen is overwhelmingly the most important room when it comes to the buying decision.

Propertygenie.co.za has entered into a partnership with fractionalownership.co.za to provide access to the latest fractional ownership listings which will be available from the 12 December, 2008.

South Africans spent over R10 billion during the festive season last year. This year ooba suggests carefully planning your holiday season spending to avoid a financial hangover in January 2009. "Festive season debt can take months to pay off in the new year," says Jenny Rushin, Provincial Sales Manager for ooba (formerly MortgageSA).

Weak economic conditions, higher interest rates and the global credit crisis have forced banks to be far more picky about who they will lend money and less generous with their lending rates. But Mary Jane Lefevre, Regional Sales Manager of ooba, said that before you apply for a home loan, there are steps you can take to improve your credit status and encourage lenders to look more favourably on your application.