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Real Estate Basic Buying Process Guide continue…
By arlene | September 13, 2008
It is important to be realistic about the price of a house. Some people insist on getting a so-called “bargain” - a property they can buy at a significant discount to market price. A house, when you buy it is seldom a “bargain”. Mostly you will buy it at fair market value, at a price it would have been available to any other buyer. It’s only when, in a couple of years (after the value of the house has increased), that you’ll look back at the purchase price and say: “I bought a bargain!”.
After taking all these factors into consideration you must decide on a fair price, one which the seller should be expected to accept.
Should the seller decide not to accept the price offered, he/she could make a counter-offer by simply changing the purchase price on the agreement. Once you accept the counter-offer, it will become a legally binding agreement.
Home loan approval
The Offer to Purchase should include a clause that reads: “This offer is subject to the condition that the purchaser is able to obtain a mortgage bond for the sum of R… from a financial institution within… days.” (You will only be in a position to buy the property if the necessary financing can be obtained.)
Note that you will need to have your home loan approved before a set date — you should therefore not waste time in submitting your home loan application as soon as your offer has been accepted by the seller.
Date when you’d like to move in
The date of occupation, to suit both you and the seller, should be determined in the agreement. This could be on a specific date, such as the first day of a month, or on date of registration of the property into your name. It might be better to agree on a specific date, as this will allow you to plan with a greater degree of certainty. The date of registration is difficult to determine exactly and it could fall in the middle of
The month.
If you moved into your new house before it has been registered in your name, you will have to pay “occupational rent” (also called “occupational interest”). This amount should be agreed upon in the Offer to Purchase.
When buying a property occupied by tenants, get hold of a copy of the rental agreement. The rental agreement will take preference above any purchase agreement as our law acknowledges that “huur goat voor koop”.
Therefore, if the tenants still have a contract to live in the property for another period of time, you will not have the right to move into the property until the contract has expired.
The so-called “voetstoots” clause
This clause means that the property is sold “as is” and that the seller is not responsible for any latent defects in the property. However, this clause is only applicable to non-visible defects of which the seller is unaware.
Other conditions
You could add clauses in your Offer to Purchase to say that certain faults must be fixed before you move in. You can also add a list of movable items that the seller has agreed to include in the sale, such as the stove, light fittings, TV aerial, curtains, swimming pool equipment, etc.
Possibly related posts: (automatically generated)
Real Estate Basic Buying Process Guide continue…
- UK Garages Rental
- Letter of Intent
- Contract Negotiations
- Supply and Demand
- What an Real Estate Agent can help?
- Breaking a Contract
- Breaking a Contract
- The Need for Legalese
- Bad Luck or Bad Attitude?
- Negotiating Skills Part 2
Topics: Contract, Market, Property, Rental, Sale |
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