Start your home-buying journey with Standard Bank’s new free online home-services tool
LookSee helps consumers make informed decisions about buying and selling property
Many of us have grown up hearing that it’s better to own your own home, rather than pay off someone else’s bond by renting. Parents and guardians encourage their working-age children to buy property as soon as they sign their first employment contract. Friends silently compete about who will be the first to own their own home. Yet, according to available data, many of us will wait until we are at least 37 years old before making that first entry into the residential property market.
There are many reasons for this. The economy hasn’t been kind to the young, and property - widely considered to be a reliable barometer of the state of an economy - has been particularly harsh. The property price bubbles of the first decade of the 21st century have kept the ownership of property at bay for many young people. During this time, rental prices have been slow to catch up to the selling price of residential properties, making them far more attractive to young adults.
... young adults are known to be quite risk averse and sensitive to changes in interest rates and taxation
There was a time in the not-too-distant past when, for only R7,500 per month, you could rent a two-bedroomed flat valued at R1.5m in Cape Town’s Sea Point. Many reputable real-estate agencies often estimate monthly bond repayment costs for residential property at around one percent of the sale price of the property. In other words, a home that is listed for R1.5m, is expected to cost approximately R15,000 per month in home loan repayment costs. This is of course, before considering expenses relating to home ownership, such as municipal rates and taxes, transfer costs and the like.
This knowledge may be enough for many people to consider buying a home instead of renting. However, it seems that young people are still reluctant to take that big step into the property market. This is an understandable hesitation. The information, if not readily available, can be overwhelming without the proper guidance. Add to that, young adults are known to be quite risk averse and sensitive to changes in interest rates and taxation.
Andrew van der Hoven, head of Standard Bank home loans says: “Whether you’re in the market to buy a home or you’re a homeowner trying to understand your suburb, you are faced with the challenge of accessing relevant information and then interpreting that information. This can cause create great anxiety and often feels disempowering.”
To help overcome these feelings of uncertainty, LookSee, Standard Bank’s online home services tool offers guidance as well as free and readily available information for first-time home buyers and sellers 24/7.
LookSee allows buyers, sellers, homeowners and industry participants to research properties by accessing free guides to help them make informed decisions on their homes.
The online home services tool offers:
- a property value including highs and lows, last sale price and how the growth rate compares to the national average;
- an understanding of the once-off and unique monthly cost involved with owning property;
- an estimate of home insurance, rates and taxes;
- an interpretation of the crime trend and understanding of key surrounding amenities
- a review of the area in terms of demographics, sales trends and property turnover
- a downloadable comparison report of up to three properties on various dimensions
If you’re a first-time buyer, you can follow a seven-step guide called “Home buying tips for first-timers”, starting with working out your affordability, as well as offering a range of financial assistance for low-income earners. Most importantly, Standard Bank also provides first-time buyers with insights into the properties you are interested in, which empowers you to negotiate a more favourable sale price. The insights provided in this service also alert potential buyers of any hidden monthly costs such as municipal rates and taxes. This can help buyers avoid any financial surprises once the deal is sealed.
As the largest home loan provider with a market share of 34%, we are guided by the decision-making requirements of our customers and partners, and to help everyone on their unique home journey.Andrew van der Hoven
According to the latest available data, the average sale price of homes sold to first-time buyers is R680,000. In terms of location, size and amenities, this price is may mean one thing in a rapidly integrating city like Johannesburg; and yet another in a rigidly planned city like Cape Town.
At 37 years of age (the average age of many first-time home buyers) this price may also not buy enough space for someone who might be starting their family (or looking after younger siblings or elderly parents).
For these reasons, township homes are becoming more and more attractive to many first-time buyers. Increasing demand for township homes has resulted in a rise in sale price of around 11% in 2015 alone.
It’s not easy moving to a township one didn’t grow up in. While the close-knit nature of township life may be attractive, there are other considerations that must be taken into account like accessibility, proximity to shopping centres and crime trends among other factors. LookSee extends far beyond just the rands and cents issues that need to be considered.
Buying your own home is a daunting task, but it is made easier with the right partner to help you plan and make an informed decision. As many of us have limited family experience in these matters, it helps to know that there are experts out there who are willing to hold your hand, at no extra charge, every step of the way.
Van der Hoven says: “As the largest home-loan provider with a market share of 34%, we are guided by the decision-making requirements of our customers and partners, and to help everyone on their unique home journey.
Standard Bank is in the process of adding more functionality to LookSee. These updates will be added in the course of the year.
“As an example, we will soon be releasing a unique review of sectional titles using information we have gathered over many decades. Again, we want to empower all participants to provide relevant, accessible and interpreted information for customers,” he says.
Fast-track your research by visiting LookSee, Standard Bank’s free property guide, so you can make informed decisions.
This article was paid for by Standard Bank.