IT’S NOT JUST THE PRICE YOU HAVE TO WORRY ABOUT

THE PROCESS of purchasing one’s first home provides a steep learning curve but there are other concerns for first-time buyers, says Adrian Goslett, chief executive of Re/Max of Southern Africa.

These include the deliberations of the national Monetary Policy Committee, which meets every two months to decide on the prevailing repo rate, on which banks base their home loan interest rates.

“Historically, the committee usually adjusts interest rates by around 25 basis points, which means that homeowners’ bond repayments could fluctuate slightly over time.”

Another aspect of homeownership of which first-time buyers are probably unaware, says Goslett, is the General Valuation (GV) Roll which is used to calculate a household’s municipal rates. The roll is valid for a period of four years and is presented to the public for inspection before any new rates are implemented.

“Homeowners will need to check if they agree with their property’s valuation in the roll, as this will have a direct impact on how much their municipal rates will be.”

First-time buyers should also be aware of the finance minister’s annual budget speech and listen for any announcements that could affect their income.

“Announcements that would have a direct impact on homeowners include any changes to the transfer duty threshold and capital gains tax, as this will affect the costs of buying and selling property in general.

“Other indirect impacts include changes to the income tax brackets, VAT and other taxes, as this will impact a household’s income which might affect one’s ability to afford the bond instalments,” he says.

New homeowners need to be aware of a few things that will directly and indirectly affect their finances. RODNAE PRODUCTIONS / PEXELS