Low interest rates have seen an unprecedented amount of people entering the property market as first-time home buyers. But what are the steps to take after you spot your dream home? Please see the below piece from Carl Coetzee, CEO of BetterBond, that explains the home-buying process, with savvy tips for every step a new homeowner needs to take.
How to make an offer on a home
You have found your dream home, and now you want to sign on the dotted line to make it your own.
“Remember that an Offer to Purchase (OTP) is legally binding, so only offer what you can afford. Make sure everything else is in order and soon you’ll be holding the keys to your new home,” says Carl Coetzee, CEO of BetterBond.
Here’s how to make sure your OTP is successful:
Find a place to call home
Do your homework during your house-hunt and find a place you can happily call home. Take your time, and view it more than once, to make sure it’s the place for you. Some of the most important questions to think about, include:
- Is the location right for your lifestyle?
- Is the property in good condition – physical structure sound, with no obvious defects?
- Does it offer the space and accommodation you need?
- Is there enough parking?
- If it’s a sectional title property, is the complex neat and well-maintained, and is everything in working order?
- Are pets allowed?
- Can you live with the levels of noise in and around the property?
- What is happening in the surrounding area – is it rundown or being developed?
- Is crime under control in the neighbourhood?
Get a professional to draw up an OTP
Ask an attorney or an experienced estate agent to draw up an OTP for you, instead of downloading one from the internet, advises Coetzee. “Your OTP should be tailored to the property you’re buying to make sure it covers all the important aspects of the sale. Do not rely on a generic document that might leave out essentials that could cost you time and money later.”
Read it with care
Make sure that the following are included and correct on the OTP before you sign anything:
- Your details.
- Seller’s details.
- Description of the property as it appears on the Title Deed.
- Purchase price that you are offering.
- Occupation date.
- Fixtures (permanently attached, e.g. ceiling fans) vs chattels (not attached, e.g. appliances).
- Full list of defects.
- Special conditions, for example getting bond finance or selling your current home before the new deal can conclude.
Agree on the purchase price
“Offer what you can afford, but make sure it’s a reasonable amount that will appeal to the seller, says Coetzee. Strengthen your case by providing a reasonable explanation and motivating why you’re proposing that amount. “A good way of showing that you are a serious buyer is by providing bond pre-approval, which can be done with BetterBond, at no cost,” he adds.
Sign on the dotted line
Once everything has been checked and agreed, all that remains is for you and the seller to sign. “An OTP is a legal document, so once you’ve both signed, it’s a binding agreement. Assuming your bond gets approved, an OTP constitutes a Deed of Sale so there could be financial penalties if you pull out,” says Coetzee. The bond application process can start once the OTP is signed.
*Article sourced from SA Property Insider*