adminvalue of their money (purchasing power) juxtaposed to the real estate investment desired.
There is therefore a propensity to either overestimate the actual buying power of the money available creating illusions of grandeur which may never be satisfied by the agent or seller given the resources available.
Whether the intended property is to be purchased for cash or using a mortgage, the first-time buyer must be certain of the minimum requirements the house is to possess vis- a-vis the capital available.
It is a fact that any extra bedroom or lounge may require more than what one will pay for a similar property situated in the same area that does not have that extra room.
In an ideal world, the first house that one buys should satisfy all the dreams that the buyer has. However, this is not the norm and normally practical decisions need to be made.
This in some instances may mean that a house that was previous not an option may need to be considered and renovated to suit the vision of the purchaser.
It is essential that one does a practical review of the prevailing prices. Since it is difficult to save money and given that windows for mortgage opportunities in our market open and close unceremoniously, the first-time buyer should have a basic idea of prevailing market rates for target areas as a prerequisite to lessening the potential of repeated disappointments of rejected offers to purchase.
Most of the buyer’s time is spent pursuing deals that are not achievable while the actual property that is ideal, given the capital available, is bought by another person.
I am not advocating that one purchases a property blindly or without a thorough search through available listings, what I am advocating for is that one engages a competent person in real estate for advice and assistance of finding the right property within their price range that meets the minimum requirements.
It is critical that the first-time buyer is not blinded by the advent of the transition from being a tenant to a property owner to the extent that one forgets that the property itself is an investment.
In the euphoria of buying the first property, one must ask the assisting professional which may be the agent what prospects of return the property will have in the future.
What has the previous price movements been like in the area over a specific period of time. What modifications may one do to increase value and up to how much may one invest in a certain area before the law of diminishing factors take effect.
These are all relevant questions that people hardly ask when purchasing first property. In the end the buyer may make a wrong decision based on what the naked eye sees, the classic cliche of a rabbit being attracted to the car lights of the car that will kill it.
Stories abound of first-time buyers who over-invested, failed to take cognisance of the small problems that became big problems on the property. This may result in the expense of maintaining the particular property not being commensurate to the benefit being enjoyed
The first-time buyer must also be aware of the expenses one will incur after purchasing the property, although estate agents commissions are paid by the seller, conveyance fees are normally the preserve of the purchaser and must be factored when calculating the total amount payable for purchase.
One must also consider the expenses of maintenance of particular property whether it is sustainable given the income available so that the property either maintains value or appreciates in value. Good luck on your first purchase.
l Vengai Madzima is a property investment consultant and analyst and writes in his personal capacity. He can be contacted on 0772468093 or [email protected]
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