4 Brilliant Old School Property Tips

You’re thinking of selling your property, but how will you get the best price? The value of your property is only worth what a buyer is prepared to pay for it at any given time. If a prospective buyer wishes to raise a home loan to purchase your property, the assessors of the financial provider will need to find sufficient value in your property to merit financial assistance. Will they find this value in your property?

Tune In To the Market

Speak to the professionals and obtain an unbiased and professional opinion on the estimated value of your property. Estate agents will possibly be happy to grant this visit and give their evaluation of your property freely.

However, you might have to pay for the professional advice of others you might engage, such as an engineer, if you are unsure of certain existing or proposed new building structures. You will need to ensure that your property is cleared in terms of the certificates of compliance: electrical and termite soundness.

In accordance with the CPA (Consumer Protection Act), all information must be disclosed to a prospective buyer. It would be wise to maintain and repair while living in your home and not to not allow it to deteriorate over time, which could ultimately prove costly.

Good Old-Fashioned Tips for Adding Value before Selling

  • Professional Opinion
    Paying for a consultation with a professional could be well worth the upfront cost and add value when a buyer applies for a home loan. Persons with a trained eye and experience will quickly realise which changes will make an enormous impact. The removal of a wall can create an impression of space and give an updated open-plan appearance to a home, which could translate into a quicker sale at a better price.

    It is advisable to have serious alterations performed by professional workmen. The quality of the repairs will be evident in the time saved and value added to your home.

  • Bathrooms
    Bathrooms and kitchens are the rooms that date a home and are especially important in a selling market. An olive green bath, toilet and basin in a setting of busy brownish coloured tiles, is enough to trigger a bout of depression.

    Entering a bathroom with pristine white porcelain set against neutral light stone-coloured tiles and effectively lighting, immediately creates images of relaxing in a bubble bath, sipping a glass of wine and listening to Andrea Bocelli…

  • Kitchens
    The amount of time spent in the kitchen cannot be denied. Crowded, sad-looking work areas, insufficient light and undersized storage spaces will kill off any Master Chef aspirations in anyone.

    Repaint the cupboard carcass but think about replacing the doors. If the doors are wooden perhaps sanding them with a fresh coat of varnish will restore the original glow. Textured paint finishes were the trend a while ago; but today consider having a white, or neutral coloured, coat of paint professionally applied to the cupboard doors.  The state of the counter tops should also be taken into account.

    It might be prudent to allow certain appliances that have custom-built spaces, such as a really large double-door fridge, to remain as an added incentive to the buyer. Besides, it would probably be difficult to accommodate it in your new home.

  • Cleanliness Is Next To Godliness
    This is a proverb which should take you back to your old school days when you had to learn lists of sayings, and it is brilliant advice when selling a property. Nothing comes close to discouraging a buyer as does dirt, clutter and bad odour.

    Firstly, pack away the clutter. Yes, you have been meaning to get to it, but now is the time to do it. Sell it; give it away or if you are unsure: pack it up, hire a storage garage and put all “clutter”, including excess furniture, out of sight. The importance of visual space cannot be over emphasised. Your home will be lighter, brighter and appealing without subjecting buyers to visual overload.

    Why does your home smell old and musty? Is there damp to be dealt with; do the carpets need to be removed or is it too crowded with furniture, books and belongings? If the task appears daunting, hire an interior decorator or professional cleaners for help.

    You will be given advice on how to put your space and furniture to effective use. Professional cleaners will not only pack away excess goods but will bring in a cleaning team and soon have your home fresh and sparkling.

  • De- Personalise Your Home
    The truth of the matter is that others are not as interested in your special mementos, family photographs and Aunt Susan’s grotesque ‘silver’ vase you keep so as not to offend her. Your prospective buyers will want to imagine themselves in the home, adding their own personal touches, valuables and belongings.

An opinion is formed within the first few seconds of contact. This is true, especially when viewing a property. A beautiful approach and entrance to a property will win anyone over leaving them anxious to discover more. A tidy, well laid out and cared for garden is an asset to work on. A well-presented clean home with a wow entrance and approach will be a sure winner in acquiring a home loan for the property you have fallen in love with.

Estate Agents you can help Your Buyer Qualify for a Home Loan by asking them to get prequalified. Get in Touch with Homeloan Junction for more details about our homeloan options.

Yours In Property

Vincent

 

Are you living dangerously?

A home loan is the means that allows most people to buy a home.  Your home is your sanctuary: the place where you can relax and be yourself; the place where you can entertain and enjoy your spare time and most importantly, a safe space to raise a family.  However, have you made sure it is really safe?

In South Africa we all know that the crime rate is very high.  In 2015 the crime statistics released by the South African Police Service indicate that there were 20 281 “robberies at residential premises” and there were 253 716 “burglaries at residential premises”. The difference in definition between robbery and burglary is that burglary is the illegal entry into a premise with the intention of committing a crime (mostly theft), and robbery is theft that is accomplished with force or the threat of force (such the use of a weapon or violence).  A sobering thought.

None of us wish to end up a statistic.  We also do not want to live our lives in perpetual fear.  So what can do to make sure you don’t become a victim of crime in your home? Your home loan secured the house for you; now you need to secure your home.

Home Security Tips:

1. See it to Believe it!

The first thing you can do is look at the physical security of your home.  In times gone by you could build a deep moat inhabited by crocodiles.Today it is more customary to build a wall or fence around your perimeter.  Whilst many people choose a wall for aesthetic purposes, bear in mind that there is much more visibility with a fence and it makes it more difficult for an intruder to gain entrance to your property without being seen.

Burglar bars, security gates, electric fencing, razor wire.  These are all examples of devices that can be used to physically protect your home and its occupants.  You can often structure your home loan in such a way that you have access to money to finance these options.

2. Sound the Alarm!

Another obvious way of securing your property is using an alarm system.   This could be a sophisticated alarm with beams in your garden, motion detectors in the house, panic buttons, sirens, and a radio signal to an armed response company. It could also be a simple, makeshift, early-warning system.

3. Bring the Village back to the Suburbs

Most of us do not know our neighbours. High walls or fences separate our properties.  In the suburbs many live an insular existence, retreating into their homes behind gates and locked doors.   Have you considered how different it could be if you knew your neighbours?  What if your neighbour was keeping an eye on your house because they knew you were away?  How would it be if you could message your neighbour that there is a suspicious looking character loitering in the street?

Modern technology can be a facilitator for creating community and safe spaces. A Whatsapp group including all the people in a street or neighborhood can be a powerful tool to connect people and share information.  A Facebook group can assist people in getting to know each other, and create a community that feels connected and looks out for the welfare of others.

Now that you have the home loan and you have the house…

International statistics show that the majority of thefts in the home occur within the first twelve months of moving into a property. This is even truer in South Africa.  You are new to the area, and to your home, and you are not yet aware of the vulnerabilities of your neighbourhood and your house.  This makes you a prime target.

The best advice I have heard in this regard is “act like a skelm”.  Approach your home as if you were a thief that wanted to exploit the vulnerabilities your home presents.  Most burglaries are opportunistic – the weakness presents itself and is too good to pass up – and if you “case” your own property you can see what changes you need to make.

Your home loan has assisted you in getting your dream house.  Don’t let it become a nightmare.  You can secure your home by making simple changes and being more aware of your surroundings.  Connecting to your community, or being the catalyst that creates a community, is a worthwhile and valuable endeavor.

Yours in Property

Vincent

INTEREST RATE REVIEWS AND THEIR IMPACT ON OUR HOMES

A very interesting week last week. Two interest rate reviews, one up and the other, sideways.

But before we think about the effect of this on our home and homeloan businesses, here’s a quote from Ayn Rand to encourage you:

“In the name of the best within you, do not sacrifice this world to those who are its worst. In the name of the values that keep you alive, do not let your vision of man be distorted by the ugly, the cowardly, the mindless in those who have never achieved his title. Do not lose your knowledge that man’s proper estate is an upright posture, an intransigent mind and a step that travels unlimited roads. Do not let your fire go out, spark by irreplaceable spark, in the hopeless swamps of the approximate, the not-quite, the not-yet, the not-at-all. Do not let the hero in your soul perish, in lonely frustration for the life you deserved, but have never been able to reach. Check your road and the nature of your battle. The world you desired can be won, it exists, it is real, it is possible, it’s yours.”
– Ayn Rand

On 28 January, the Monetary Policy Committee of The South African Reserve Bank [SARB] announced an increase of 0.50% in the Repo rate, which will result in the Banks’ Prime lending rate increasing to 10.25% with effect from 29 January 2016. This was the first interest rate review mentioned above.

A few comments:

  • I heard a leading economist interviewed this week and he would not be drawn into quantum of the interest rate hike in 2016, whether 1 or 2%, but he did make the point that it would be well considered and managed.

  • I did stick my neck out in the last blog and say 2 % this year as I feel the Rand and inflation will have the final say on how much.
  • As regards the Rand, it was wonderful to see it pull back; from the mid-R16 range, to about R16.26 to close around R16.18 on Friday. So the market was factoring in a significant rate hike on Thursday and got it.
  • We are between a rock and a hard place with the interest rate. From a growth perspective, we cannot afford rising rates. Both indebted business [Employment] and consumers [Affordability] will find the going tough. Harming either constituency will harm the country. Sadly, though, with the Rand slide by about R3 from R14 to R16 (and as high as R17) to the US$, Inflation will rise. The 6 tons of Maize being imported does nothing to improve the situation. Last year, Inflation averaged 4.6% and in 2016, is expected to average 6.8%. The SARB target range is 3-6%.
  • Remember, absolute versus relative maths. “Only 2.2%” does not seem like much Inflation, but it is 48% [2.2/4.6*100] more Inflation than in 2015. In turn, the 0.5% rise in rates is not “just half a percent”, but forms part of a 1.75% rate rise off the lowest base, 8.5% on 20 July 2012,  since 15 November 1973 [See the Chart attached] when it was 8%. Therefore in relative terms, the cost of interest has risen since July 2012 by 21% in three and a half years. That’s a lot more interest being paid.
  • The process is being well managed and is simply unavoidable. The SARB has done the responsible thing and protected the Rand exchange rate which has been in a mess even before El Nene given Emerging Markets battling a very strong US$. By the way, a stable exchange rate to all major currencies is one of the core functions that a Reserve/Central Bank executes. In addition, if our Finance Minister has any chance of staving off a Non-investment grade rating by the Rating Agencies, he is going to need a strong, independent SARB doing what is right for Inflation. Also, by the way, his fight with SARS is also very important as they need to collect the revenues in order to keep Government stable. In the absence of efficiency in SARS, taxes will go up much more in February.

So, to sum it up, the rate rise was good for SA Inc, Inflation and the Rand/$ exchange but bad for Debt users. Overall, probably unavoidable after December 2015. I sincerely hope my 2% rise (1.5% remaining) proves very wrong for us. Watch the Rand, Inflation, the Drought and Oil.

With less detail, the US FED decision to retain the US interest rate where it is was is also them saying they do not want to dampen the US economy. That is really good news as:

  • The stock markets accepted that as meaning the US economy remains strong enough for about 2% growth in GDP. Hence the global markets rallied somewhat.
  • That fact makes up for China and provides them some headroom to work through their issues.

So, overall, a good week for rates in a fragile environment.

So what about us, you ask?

FNB put the house price rise for 2015 at an average of approximately 6.4%. that would give a real price rise of almost 2% after Inflation. ABSA, in their January 2016 synopsis expects an approximate 5% rise in 2016 and this will result, as we can expect from the rise in Inflation, in approximately -1.8% decline in real house prices this year. They quote a number of factors but the one that would concern me the most is weak Consumer Confidence. But please remember, the reversal in the real house price growth rate is because of the large increase in inflation and not necessarily because less homes are being sold.

That means that house prices will continue to rise so the question then is:

–        What volume will be sold?

–        How much of that will I, as the estate agent/principal, sell?

My sense is that less houses will be sold this year and the affordable homes will continue to dominate sales. My reasoning is simply that affordability will be affected by higher interest rates and Inflation will eat away little by little at our disposable income. I expect some tax increases but I’m not sure if the Finance Minister will target the rich or make them across the board. I don’t think VAT will rise as it is just too sensitive – we’ll see.

The last question remains yours to answer. When all the pundits have had their say and I have written mine, you must decide if you are going to list less, show less and sell less. That answer remains with you and your energy and enthusiasm. Believe all you read and internalise it, and anyone could predict your outcome – sales will slide.

Read it, think it through and find the way around obstacles with optimism and determination, not letting  the hero in your soul perish, and you will enjoy success. Check your road and the nature of your battle. The world you desire can be won.

Homeloan Junction has made that decision and will be there to support you in yours.

Yours in Property.

Jack