Buying a house on a single income?

Here’s how!

05 August 2020 | Life Style

While many might think it impossible to purchase real estate on a single income, Lightstone Property reports that single females make up the largest portion of real estate buyers, out-purchasing both their married and single male counterparts.
Although the process of buying a home as a sole owner may seem daunting, Adrian Goslett, Regional Director and CEO of RE/MAX of Southern Africa, says that this can be an extremely good financial move if done correctly.
“Real estate purchases are one of the safest and highest yielding long-term investments a person can make. To make a safe real estate investment that will yield good returns, it is vital to work out an affordable budget and stay within those limits.
“When deciding what is affordable, consider all recurring monthly expenses such as home maintenance and repairs. Especially when purchasing on a single income, it is incredibly important to leave room in the budget to contribute towards a contingency fund in the case of an emergency. Considering there will only be one person responsible for the bond repayment, there needs to be enough money put away to counter any unexpected circumstances or loss of income,” Goslett advises.
An additional factor to consider is that, as a solo buyer, there is likely to be a smaller budget than a couple who can join their savings and income. Therefore, solo buyers will need to be smart with their money. Goslett advises having at least a 10% deposit saved up, along with enough money to cover all the other costs associated with buying a home (including transfer duty, attorney fees, home insurance and bond costs).
“By avoiding taking out a 100% loan, not only will the monthly repayments be lower, but the buyer will also often secure a lower interest rate on the home loan and save a substantial amount on interest charges over the span of their loan term,” says Goslett.

Long-term investment
The next thing single income buyers need to consider is that real estate is a long-term investment. To ensure that the buyer will one day make a profit on the sale of the home, the buyer needs to purchase a home in which they can imagine living for at least the next five to ten years.
“The buyer’s plans will largely determine the type of home that will suit them best. They might be single now, but do they foresee having a partner within the next ten years? Single income buyers might want to consider homes with the potential to add-on. Alternatively, they could find a small starter home that can be rented out in the future if the property no longer suits his/her needs,” Goslett advises.
The reality is that a buyer purchasing a property on their own may need to compromise on certain aspects and features owing to budget limitations. From an investment point of view, Goslett recommends looking for the location before the property itself.
“A property can be renovated or changed, but where it is situated cannot. It is important to research the areas that are within the budget and then work from there. Buying in a better area might mean purchasing a smaller home. However, it will be a wiser investment that will see greater returns over the long term,” he says.
While going it alone can be overwhelming at times, it doesn’t mean that every decision has to be made alone. Family and friends who have purchased a property can act as a soundboard, providing honest and objective feedback. “A real estate practitioner can also guide buyers through the process and be by their side to help them make the tough decisions. A reputable, experienced real estate professional can be a valuable asset, providing guidance and advice through the home buying process,” Goslett concludes.

Similar News

 

Adjusting to the responsibilities of homeownership

4 days ago - 15 September 2020 | Life Style

You’ve taken the leap: Bought your first home!And now suddenly reality has hit…The truth is new homeowners are likely to go through a period of...

Shrink your carbon footprint – here’s how!

1 week ago - 08 September 2020 | Life Style

Covid-19 has awakened the world to how quickly we can change our behaviours when confronted with a crisis that threatens our very existence. Yet, once...

Save time when house-hunting online

2 weeks ago - 03 September 2020 | Life Style

Today’s technology streamlines the house-hunting process to help buyers sift through the hundreds of listings available and narrow down the options. When buyers complement the...

Spring clean to reduce the stress of lockdown living

2 weeks ago - 01 September 2020 | Life Style

Café coffee has been replaced by a countertop coffee pot and commuting to work means going from bedroom to kitchen. Spending more time indoors right...

Moving? Do so safely

3 weeks ago - 27 August 2020 | Life Style

Moving homes can be a physically draining task. Deciding to make use of a professional moving service can eliminate a lot of the hassle and...

Peaceful dreams

3 weeks ago - 25 August 2020 | Life Style

The countless sleep monitoring and wind down apps currently available paint a worrying picture of the health of our sleeping habits. With our high-powered lifestyles,...

Staying stylish

1 month - 20 August 2020 | Life Style

Well-designed kitchens and bathrooms are invaluable assets to sellers as most buyers will consider these rooms to be either the deal breaker or a deal...

New beer on the Horizon

1 month - 19 August 2020 | Life Style

Namibia Breweries Limited (NBL) introduced a new non-alcoholic flavoured beer - Horizon, available in three flavours.According to NBL’s Global Marketing Manager, Rene Duffy, “Horizon broadens...

Upgrades and new trails at Farm Windhoek

1 month - 13 August 2020 | Life Style

The IJG Trails on Farm Windhoek are undergoing some changes that the team there is very excited about.According to Peter van der Merwe, these changes...

Create your ultimate home theatre

1 month - 06 August 2020 | Life Style

Lockdown has caused the re-emergence of drive-in cinemas and increased the demand for at-home theatres.According to Adrian Goslett, Regional Director and CEO of RE/MAX of...

Latest News

Qatar also heading back to...

2 days ago - 17 September 2020 | Transport

Come 15 October, Qatar Airways will be flying to Windhoek three times a week again.The announcement came earlier today, and follows the decision by Eurowings...

Sen Pang leads UN Namibia

2 days ago - 17 September 2020 | People

Sen Pang, the newly appointed United Nations Resident Coordinator in Namibia, was received at State House, where he handed over his Letter of Credence and...

Informal market coming for Havana

2 days ago - 17 September 2020 | Infrastructure

Windhoek mayor Fransina Kahungu said the city received a pledge of N$5 million from the ministry of industrialisation, trade and SME development to help build...

Eurowings makes a Namibian return

2 days ago - 17 September 2020 | Transport

Eurowings will resume their Frankfurt-Windhoek route this weekend, with the first flight landing at the Hosea Kutako International Airport (HKIA) on Sunday.In a media statement,...

Another Air Namibia resignation

2 days ago - 17 September 2020 | Business

The national airline’s chief financial officer Werner Schuckmann has tendered his resignation with effect 30 September 2020.The process to recruit a substantive chief financial officer...

Card fraud on the increase

2 days ago - 17 September 2020 | Opinion

Windhoek • Riaan ViljoenDuring the lockdown, a whole new generation of users discovered the joys and convenience of online shopping.Worldwide, online debit or credit card...

Masking Namibia

2 days ago - 17 September 2020 | Social Issues

Local social impact agency, Arba Stature, in partnership with Namibia Breweries Limited (NBL) donated 2253 face masks to 25 schools through its #CoverNamibia campaign.Designed to...

GIPF says investments safe

2 days ago - 17 September 2020 | Economics

The Government Institutions Pension Fund (GIPF) said that it is aware of the de-registration of the Baobab Capital (Pty) Ltd (the fund manager) and Baobab...

International accolade for EIF

3 days ago - 16 September 2020 | Environment

The Environmental Investment Fund of Namibia (EIF) received a certificate of merit for outstanding Sustainable Project Financing at the Karlsruhe Sustainable Finance Awards, recognising its...

Load More