Money

How to Take Those All-Important First Steps on to the Property Ladder

Story Highlights

  • Save, save, save
  • Find a mortgage
  • Invest in your future

For many South Africans, owning a property is a lifelong dream.

But with figures showing that in popular cities like Cape Town prices can rise by over a third in three years, it’s clear that there are still some barriers in place to getting there.

Getting the deposit together is one thing, but ensuring that you’re eligible for a mortgage is another.

While it might be a difficult path, it is possible to do:

Save, save, save

When it comes to accumulating enough cash for a deposit, there are several routes to getting there: for some people, a deposit for a home is handed to them on a plate – perhaps through inheritance, but for most, however, saving up is the only way.

Saving isn’t always easy, though, and sometimes it’s simpler talked about than actually done.

With the average cost of a healthy food shop for a family of four now well over R2,000, it’s clear that luxuries may need to be the first to go.

This sort of rule applies to you whatever your job or background, too, as money doesn’t discriminate!

Graduates may have higher earning potential, for example, but cost-cutting advice for those with degrees is just as valuable as advice for those without.

Find a mortgage

Once you have the cash for a down payment, the next step is to look for a mortgage provider.

There’s no hard and fast rule about much you’ll be able to borrow: it’ll depend on a number of factors, including the particular lender and also what your own personal financial circumstances are.

In order to avoid getting your hopes up, it’s a good idea to meet with a mortgage broker early in your home-buying journey to get a realistic picture of your chances.

Invest in your future

Taking out a mortgage or agreeing to look after a property is about more than just paying off debt.

It’s about forecasting your behaviour, earnings and more over the course of the next few years – or even decades.

Exactly for that reason, getting on to the property ladder isn’t enough: you also have to ensure that you’ll be able to pay your mortgage and maintain the property as time goes on.

Focusing on your career is a good way to do this, and it’s wise to consider retraining if you feel like you might not be able to earn enough to cover the burden in the future.

Getting on the property ladder may seem like a pipe dream for many people – especially young people, who are often faced with uncertainty in the workforce, rising prices and more.

But all is not lost.

By saving up, hunting out the best mortgage provider and looking out for your future, you can help to ensure you have the best possible chance of getting your foot on the first rung of the property ladder.

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