Owning a home is every individual’s dream. However, most people cannot afford to buy a home with savings of their own and need their purchase to be financed by a financial institution. A loan provided by a financial institution to purchase or renovate a home is known as home finance. Purchasing a home offers several advantages. Perhaps the biggest advantage is that it allows you to build home equity when you pay the mortgage each month.
It is a common myth that paying monthly mortgage payments is much more expensive than paying rent. Often mortgage payments may be less than the rent. Unlike rent, which might escalate each year or every few years, mortgage payments are usually fixed throughout their tenure. The interest paid on a mortgage payment is tax deductible. Also, you can take a loan against your home equity at attractive rates of interest and convert it to cash.
With the thought of buying a home, there arise many questions and doubts. The questions that one needs to think about include one’s purchasing power and the monthly payment that can one easily afford towards the home purchase. These are the main criteria that need to be considered. They help one decide the budget for the purchase of a home and narrow down the search to homes that fit in the budget.
You should also consider other initial and ongoing costs. These include a down payment, closing costs, home owners insurance, mortgage insurance, utilities, maintenance and property taxes.
Before beginning the process of looking for a home, you should figure out whether you are able to get home finance and an estimate of what you pre-qualify from a lender. Getting pre-qualified is an indication to the real estate agent that you are a serious and knowledgeable buyer.
Property insurance is the kind of insurance that provides protections against certain risks on property like fire, theft or weather damage. This also incorporates socialized insurances like fire insurance, flood insurance, earthquake insurance home insurance or boiler insurance.
But before opting for any kind of insurance, one must keep in mind certain points that explain the best way to look after your property insurance. You must know how it works and your reasons for opting for one.
1) Analyze your need for property insurance – There are many reasons that may call for property insurance. If it’s a fire accident or burglary or vandalism, insurance is the best option to face. You may also need property insurance as you may need to replace, repair or rebuild your home after any accident. Apart from home you may also need to protect your jewelry, silverware, business property, cameras, phones etc.
2)Things to consider carefully – You should first consider the basic need for property insurance. Don’t forget that your need is unique so will your insurance be. Select the scenario whether you are buying a home or you have got a condominium, or you got a mobile home or just might be that you are renting. These all factors have different need and specialized insurances too.
3) Make the right choice – Choosing the right company for property insurance is also very important. One should always keep in mind the reputation, the availability, the service, the product selection and the rates before choosing any company. Choose among the various insurance providers, the right company for you. The company with strong reputation, high standards and financial stability will no doubt be the one that you might ask.
4)Find your coverage options – You should also understand the coverage elements of any property insurance policy. Personal property includes the protection to the movable properties such as your home your home with certain coverage limits. You may also ask for business property insurance and that will have its own coverage and limits. There are certain additional coverage that is provided such as replacement cost coverage, scheduled personal property coverage, building code coverage, portable cellular communication system coverage and many more.
5)Check out the discounts and savings – There are many companies that recognize multiple policies, safety conscious and claim free customers with premium insurance discount. Depending on the conditions, situations and state, you may be eligible for many discounts that are provided on the property insurance.
6)Getting quotes – You can always try and search for the property insurance companies online. This will readily provide you with the various quotes and rates that may suit your purpose. Filling the forms with your necessary details you can also ask for the best suitable quote for your property instantly.
7) Expert Advice – Another important point that you should keep in mind is the selection of a proper property insurance lawyer. Your lawyer will help you to look after your property insurance providing the necessary legal advises along with.
Today’s wallpapers are convenient and practical to use in case you want to renovate or change the appearance of your walls. You can choose from various widths (18 to 27 inches) of wallpaper in the market. A whole sheet of wallpaper can cover an area of 36 square feet but since walls too have different sizes, certain parts of the wallpaper sheet are trimmed so one sheet usually ends up with a covered area of about 30 square feet of wall area.
Wallpaper has indeed undergone important innovations. These days, if you are shopping around for wallpapers and related supplies, you can choose from a lot of wallpaper with extensive designs. There are wallpapers which need separate pastes so they can be attached to walls. There are also wallpapers which are pre-pated at the back, installers need only to remove the protective covering and the wallpaper is ready to be installed on the wall. Today’s wallpapers are also made of different materials depending on which type of wallpaper they are.
- A Common Wallpaper is one which requires the installer to apply adhesives at the back before it can be attached onto the wall. It is the classic wallpaper that adds grace and elegance to homes. Common wallpaper is ideally used in walls and areas where it is less likely to be damaged or worn such as in dining rooms, bedrooms and living room.
- A Foil Wallpaper can create a small area to be interesting with details on the walls. It is wallpaper made with a metal foil printed with a variety of patterns. This type of wallpaper requires serious and considerable amount of effort when being attached to the wall. Once folded or wrinkled, the foil wallpaper will not look very inviting. It also tends to reveal and show the flaws of the walls on which it was attached.
- The Vinyl Wallpaper has been replacing the Common wallpaper in popularity. This wallpaper may be used in variety of purposes; can be bought from paint hardware store and other home renovation shops. It may be used in almost any room of the house including bathrooms, kitchens and nurseries. Some vinyl wallpapers are manufactured with mildew resisting materials. It is easier to work with, durable and can endure some light scrubbing or exposure to moisture.
- The Flock Wallpaper is most commonly attached to the walls of dining rooms and more formal area which needs some decorative highlights. Flock wallpaper was originally made by gluing onto the sheet of paper some wool waste product. The loose flock particles must be vacuumed first before application. The flocks are washable yet may be damaged when rubbed or scrubbed.
- The Fabric Wallpaper is made from cloth and textiles. It is difficult to work with fabric wallpaper and prevent it from getting stained.
- The Grasscloth wallpaper is an exotic type of wall covering as it is made of grasses woven together. Areas or spaces where it is likely to get worn are ideal to be decorated with grasscloth wallpaper. Since it has intricate and interesting design, children are likely to touch it and thus result to possible wear.
Whether you are happy or unhappy to be moving houses or offices, moving is a significant life stressor. You can help reduce your anxiety about getting yourself and your belongings relocated by developing a good understanding of the moving services available to help you make a successful transition and by learning tips for choosing the right mover.
Before selecting a mover, take a few minutes to think about your needs. Do you want to do most of the packing yourself, or would you prefer a full service mover who will handle all of the packing and unpacking for you?
When it comes to moving services, some people prefer to do everything themselves. They want to pack and load their own belongings, take care of the transportation, and unload and unpack at the new location. There are some advantages to this approach. It is usually less costly than hiring traditional movers, and people with a lot of fragile items such as fine china or delicate computer equipment may feel better doing all the handling themselves, rather than trusting movers who might accidentally cause damage. The disadvantages, or course, are that self-moving takes a lot of time and energy. It is also physically demanding. One person alone usually cannot manage it, especially if there is heavy furniture that must be moved.
Another moving services option is known as self service moving. In self service moving, a moving company delivers a pod or crate to your home. You pack all of your belongings and load them into the crate. You then notify the moving company, who transports the crate to your new residence. You are responsible for unloading and unpacking your things. This saves you the trouble of having to drive a moving truck or a van, but you are still the one providing all the physical labor of packing and loading. Like moving completely by yourself, self service moving is only a viable option if you have friends or family who can help you move.
Another popular moving services option is hiring the moving company to load, transport, and unload your belongings. You take responsibility for packing your household goods into boxes and unpacking them when they have reached your new location. You can often obtain boxes and other packing supplies from the moving company at little or no additional cost; alternatively, you may locate your own boxes or purchase ready-to-assemble boxes from office supply shops.
This limited-service moving option allows you to arrange your own belongings so that you can be sure that fragile items are carefully packaged and that the boxes are labeled and sorted to your satisfaction. It still requires time, energy, and a certain amount of physical labor, but at least you are spared the effort of having to load and unload heavy boxes and furniture.
A final type of moving services is called full service moving. If you arrange for full service moving, the movers will come to your home, pack up all of your belongings, load them onto the truck or van, transport them to the new location, unload them, and unpack them. Full service moving can be especially convenient if you are physically unable to handle the exertion of packing, if you have a full schedule and don’t have time to pack, of if you are moving out of town or out of the country.
No matter which type of service you choose, it is important to select your mover carefully. You should only work with moving companies that are licensed and insured by the U. S. Department of Transportation. Movers should be able to provide a motor carrier license number. It’s also a good idea to check with your local Better Business Bureau to make sure there are no complaints against the company you plan to use, and to ask the company for references. Finally, to avoid misunderstandings about cost, be sure to tell the moving company exactly which services you want and what type of items they will be moving. This will enable them to give you an accurate estimate.
Contrary to belief, there are various options in which to hold property. The extent and type of property investment, one wishes to have is largely determined by the level of personal involvement during the life span of the investment, as well as the reason for the investment. Owning property for the purposes of renting to third parties may require substantial personal involvement as apposed to investing in a holiday home. For the average person in South Africa, property investment means obtaining a physical shelter for their families. Some investors may be interested in property due to its capital growth component as well as its ability to generate attractive yields and returns over time. For others it may be to pursue non financial objectives, such as being able to control a tangible asset. Thus before one decides to invest in property one needs to clearly define the reasons behind the investment. Furthermore, from an investment perspective considerations of ownership tax and management issues are of vital importance. This decision needs to be considered carefully as shifting from one type of ownership to the next may be very costly. The property conveyancing process is a lengthy process which one would not like to encounter more frequent than necessary. In this newsletter we discuss the most prominent ways in which investors can hold property in South Africa
This is by far the most common form of ownership in South Africa. It implies the owner holds direct title over the property. Ownership would be registered in the deeds office in the name of the owner. Freehold property may be owned by both companies and individuals alike. The advantage of this type of ownership is that the owner has maximum control over his/her investment and may dispose of the property as they wish. Ownership in this form also means the property may be used as security to obtain loans and finances.
Leasehold, also referred to as renting property does not give ownership to the tenant, however throughout the duration of the lease or rental agreement, the lessee (person who pays rent for the property) will enjoy virtually the same benefit as in the case of freehold above. It allows them to use and occupy the property for the duration of the agreement. The tenant pays over a monthly agreed rental to the landlord (Lessor) which entitles them to stay in the property. There are various types of lease agreements which include short term rentals, long term rentals or even rentals structured with the option to buy the property. Often the Landlord will have a very important right called a “tacit hypothec” included in the rental agreement, which entitles him to take possession of movable goods in the rented premises should the tenant or lessee not be able to pay their rent timelessly. Rental agreements are good options to consider for individuals who may not qualify for mortgage bonds as well as those who do not wish to settle permanently at a particular residence. Money paid out is money lost, thus this may not be a long term profitable investment vehicle.
Under Sectional Title, there are several owners owning different sections of property. An example would be owners of townhouses and clusters all built on the same portion of land, albeit in various sections. Each owner has exclusive ownership of his own section as well as shared ownership in the communal property such as the swimming pool, clubhouse and staircases. Sectional Title in South Africa is regulated through the Sectional Titles Acts No 95 of 1986. The Act requires that a Body Corporate be created to govern the interest of the various owners. The Body Corporate collect levies, pays rates and taxes, insurance and maintenance expenses.
This refers to the grouping together of individuals to pool finances in order to invest in property. Syndication provides the small investor with an opportunity to invest in a specific property which would otherwise not have been possible considering the size of the total capital outlay.
Property companies are similar to the above however more formalized in the form of a company specifically established for the purpose of owning property. Under this type of ownership, a company is established in terms of the Company Act 61 of 1973. These are largely institutions and individuals who form these companies and use them as intermediary vehicles to invest in property. For the investor, a property company offers the advantage of it being a separate legal entity which has distinct liability from its shareholders. Property companies tend to be large entities that are mostly listed on the Stock Exchange.
Share block Companies
A share block company is similar to the above, however it is governed by the Share block Control Act 59 of 1980. These are specifically formed companies with shareholders each owning a share in the company. Income is taxed in the hands of each individual shareholder, thus making it a convenient vehicle for investors who wish to invest in property, allowing each to have their own tax profile. Owning a share in the property entitles to use and occupy the share of property they own. The rights are stipulated in the memorandum and articles of the share block company. A variant of this form of ownership would be Fractional Title, normally associated with owning a fraction of a holiday home. This form of ownership is also governed by the Share block Act alongside the Sectional Title Act. The difference is that Fractional Title has a management company setting up a defined roster for the scheduled periods of usage throughout the year, whilst usage is informally discussed with shareholders of a share block company.
Unlike the above discussed forms of ownership, owning timeshare is much like Fractional ownership, however it only entitles the owner to usage for a week or more of a particular unit. This is applied primarily to holiday accommodation. Timeshare in South Africa is governed by the Timesharing Contract Act, Act 75 of 1983. Beware of falling for the “Timeshare trap”. Owning timeshare does not equate to holding property, it merely entitles the holder to usage rights for a specific week/s during the year. Furthermore Timeshare in South Africa does not have a good reputation and thus sales agents will often use aggressive selling tactics to lock people into buying timeshares. This is particularly evident along the Durban coastal beaches and holiday resorts such as Sun City. Timeshare is often associated with accommodation establishments which are of lower quality. Exchanging weeks across resorts is also often difficult since it is subject to availability at the particular resort. It will also be very difficult to get rid of the purchased timeshare depending on the weeks during the year purchased, in the meantime levies will still have to be serviced.
Listed Property Investments
There are various ways in which one can invest in property indirectly without having to physically hold the property. This includes Property Unit Trusts, Property Loan Trusts, Investment Trusts and Collective Investment Schemes. Listed property investments are listed on the Johannesburg Stock Exchange and traded similar to equity stocks. As this topic is voluminous, it will be discussed further in future newsletters. It is however important to note that one can invest in property stocks listed on the stock exchange thus capitalizing on trading movements.