Essential tips for first-time homebuyers in South Africa

As South Africans navigate ongoing uncertainty around fuel prices, geopolitical tensions, and volatile equity markets, the idea of owning a home has never felt more meaningful. With New Homeowner’s Day on May 1 in mind, I would like to highlight the value of property ownership as both a financial anchor and a personal milestone, while offering practical advice for first-time buyers.

In times of uncertainty, owning your own home offers a sense of stability that few other investments can. While markets may fluctuate and external pressures may shift, a home remains a tangible asset that provides both security and long-term value.

While property ownership is a rewarding goal, it is also a significant financial and legal commitment that requires careful consideration and planning. Purchasing property can feel overwhelming, especially for first-time buyers. However, with the right preparation and guidance, it can be one of the most empowering decisions you make.

 Practical tips for first-time homebuyers:

• Know your numbers: Before starting your home search, understand what you can realistically afford. Use an online bond calculator to estimate your loan eligibility and monthly repayments.

• Budget for additional costs: Beyond the purchase price, factor in transfer and bond registration costs, which must be paid upfront before the property is registered in your name. Planning for these early can prevent unexpected financial strain. Some banks offer loans of up to 105% to help cover these fees if you meet specific qualifying criteria.

• Explore home loan options: You do not need to apply for a loan exclusively at your bank. It is advisable to compare offers from multiple banks, as even small differences in interest rates can result in significant savings over time.

• Look beyond appearances: A property may look perfect at first glance, but it is important to inspect it thoroughly. Test water flow and pressure, examine electrical fittings, look out for signs of damp, and make sure the plumbing is in good working order. Find out where the geyser and distribution board are located, and ask about the condition of the roof, including any past leaks or repairs. Request a comprehensive defects disclosure form from the seller outlining any known issues. While sellers are not required to point out visible defects, the responsibility ultimately rests with the buyer to assess the property carefully. Any concerns should be clearly recorded in the sale agreement.

• Understand the paperwork: Take time to review all relevant documents before signing an offer to purchase. This includes title deeds, approved building plans, the latest municipal rates and utility accounts, as well as, where applicable, body corporate or homeowners’ association rules and financials. Also, read the offer to purchase carefully to ensure it includes everything you want and that you fully understand the terms before signing.

• Ensure FICA compliance: Be ready to provide all required documentation to the estate agent and conveyancer when requested, such as proof of residence, certified ID copies, and, for corporate entities, income tax and other relevant documents, to avoid delays in the transfer process.

• Clarify VAT and transfer duty: Whether VAT or transfer duty applies depends on the seller’s VAT registration status or the nature of the purchase. “Always confirm what is included in the purchase price and seek professional advice from a qualified accountant or auditor if needed,” says Abro.

While global and local economic conditions may feel unpredictable, property ownership remains a steady, long-term investment that offers both financial and emotional returns.

A home is more than just a place to live. It is a foundation for your future. Taking the time to understand the process and asking the right questions will put you in a stronger position to make confident, informed decisions.

* Abro is an attorney at Susan Abro Attorney.

PERSONAL FINANCE