By Anja van den Berg

Buying property is never a decision to be taken lightly and can have long-term ramifications. Real Estate Agent Jabulile Lefu of JL Properties answers the most common property questions concerning buying during tough economic times like these.

1. Considering the country’s current financial state, what are the advantages and disadvantages of buying property now?

Advantage: It is a buyers’ market due to low-interest rates. According to home loan consultants, this is set to continue for at least 18 months. It is now cheaper to buy than to rent. Generally, a buyer’s market means that many buyers are looking to purchase, which is a favourable seller position.

Disadvantage:  Uncertainty of employment and income. The COVID-19 pandemic has led to several people losing their jobs.

2. What should potential property buyers look out for before buying?

Buyers should do their homework thoroughly before signing on the dotted line. Consider the following:

• Affordability
• Attorney fees.
• Hidden fees like levies and homeowner’s cover.
• The location and reselling value of the property.

3. Is it advisable to buy property on a fixed interest rate term?

Lefu says that it isn’t advisable to buy property on a fixed interest rate term. Your monthly repayment stays the same throughout the agreed period. Yet, the fixed rate will revert or be reviewed once the term ends, which is sometimes after one to two years. “The reviewed rate is always higher,” Lefu adds.

Source:

East Coast Radio: https://www.ecr.co.za/lifestyle/house-home/covid-19-pros-and-cons-buying-property-during-tough-economic-times/