5 Clever Tips if You’re Buying a House

1. Know what you can afford
Before you start your house search you should have a very clear idea of what financing is available to you for the transaction. “Rough estimates of what you think you can afford just aren’t good enough in these days of stricter lending policies from financial institutions.

A prudent starting would be to use a bond affordability tool. You could also avail yourself of the (free) services of an experienced bond originator such as Silent Partners.  We assist potential buyers with a comprehensive pre-qualification in order to accurately assess your buying power. Another upside of doing this work upfront is that once you find the right home, a lot of the financial paperwork is already underway.

2. Understand the seller’s situation.

Insight into the homeowner’s motivation for selling can be invaluable when negotiating on the final price. Don’t be afraid of asking questions, both of the seller and the estate agent. If sellers are under pressure or in a hurry to move, it is more likely that they will accept a lower offer. It can also be useful to know what bond, if any, is still outstanding on the property as there are costs to the seller in servicing this debt the longer the property remains unsold.

3. Find out how long a property has been on the market.

The longer a house is on the market, the more likely it is overpriced for current market conditions. Over-pricing a property is arguably one of the worst things a seller can do. Conversely, it presents one of the greatest opportunities for astute buyers who can expect price cuts of up to 15% from buyers who are becoming desperate.

4. Research comparable homes.

A home’s value is governed by the current market in that specific suburb. Typically, the property market is localized, so it is important to have a good understanding of what similar homes (in terms of size, space and location) are selling for at a particular time.  One of the easiest ways to do this comparative research is to use a property website that showcases houses for sale by neighborhood from all the leading estate agencies. A large inventory of homes for sale in an area, especially in a buyers’ market, typically gives the house hunter the leverage to negotiate aggressively on price.

5. Think beyond price.

Price is not the only negotiable. If a seller won’t budge on the price, he or she may be negotiable on other issues. Sellers can often be focused on the final offer, and the more attractive the price, the more flexible they may be on other points. Buyers should also consider asking for concessions on transaction costs or items of repair or improvement.

In the case of newly built homes or new developments, developers are often less willing to lower selling prices, especially when they are selling identical units in the same complex. In these instances, however, they may well be amenable to provide other incentives, such as upgrades or free landscaping, to sweeten a sale.

So, while buyers may not be able to negotiate the asking price, there are still significant gains to be on these types of transactions for those willing to drive a hard bargain.

Get pre-qualified, or apply for a home loan with Silent Partners today.

What is Pre-Qualification?

Pre-qualification is the process of attending the primary elements required for a successful home loan application.

In order to be properly pre-qualified, the following checks need to be completed;

  1. Identity Verification. This entails providing a clear copy of your ID book (or passport if you are not a South African citizen).
  2. Proof of Address. Normally a utility bill or something similar that is posted to you at your street address provides enough proof that you do live at that address.
  3. Bank Statements. At least three months of bank statements showing your regular income/salary as well as your monthly expenses. This assists in verifying both your income and how much you have available after you have covered all obligations and living expenses.
  4. Salary Slips. Again, three months of salary slips proves that your income is consistent, and that you are both permanently and gainfully employed.
  5. Credit Report. A credit report is obtained by your bond originator and this is done to confirm that you do not have an unfavorable borrowing history. The credit report shows which retail accounts you have (or have had), and how well they are conducted. It also shows if you have any credit judgments listed against your name.
  6. Pre-qualification application. This application collects your personal details, job details, contact details and income and expense details.

From the above information, it can be quickly seen if you are a candidate for a home loan. The process has identified you, and proved that you do live where you say that you do. It also has verified that you are employed and that you have a regular income. Of equal importance is that it can be seen that you have a clear credit record and that you accounts are paid on time every month.

At Silent Partners, we have an industry-leading record of approved home-loan applications because we attend to the pre-qualification process properly. There are many other service providers who do not do a proper pre-qualification. This results in prospective home-buyers having an incorrect idea of what they can afford. Disappointment is assured when banks later decline a final home loan application.

Compare our online pre-qualification application with other bond originator’s websites and you will clearly see that we are very thorough. When you go looking for a house to buy, being armed with a Silent Partners Pre-qualification Certificate shows that you are a serious buyer, and that you have a very high likelihood of getting bank approval.

You can access our pre-qualification process here.