Recently the current minister of finance explained in parliament that there was a serious need to optimise spending in this context of current economic uncertainty.
But this situation does not mean that investing in property is a bad idea. Indeed, according to Standard Bank’s home loans sales manager, Caroline Orange, buyers have to take advantage of this period to buy much cheaper properties.
“Is it bargain hunting season? Possibly so. However, it is important not to get caught up in the prospect of buying a bargain and end up overcommitting financially in a property you are not able to afford.
“When considering to purchase a property, it is vital to establish your liquidity capability to service the debt and it is important to factor in your decision-making, such as if the interest rates go up would you still be able to afford the property.
“If your liquidity is strapped a 0.5 percent increase on your current interest rate can lead to unnecessary strain on your overall wellbeing,” Orange advises.
“Another component you need to factor into your decision making is how much work is required to the home you wish to purchase. Here I am not referring to a fresh coat of paint, but more so updating rooms, like bathrooms and kitchen.
“These are expensive refurbishments and can definitely derail your finances if not budgeted for carefully from the beginning. So what does this mean? When buying your new home, make sure it does not become a nightmare of expenses you are not able to sustain, as pipes burst and cupboards fall apart.
“Be clear that if there are items in the new home you wish to purchase that do require longer term updates, you are able to set money aside to fund those… “Property will always remain a viable investment. All that is required is careful consideration whether you can afford it now and later,” Orange said.
