South
Africa's property market is being driven by an
influx of first-time buyers as the historically low interest rate makes it more
affordable to buy property rather than rent.
Homeowners insurance is mandatory to
qualify for a bond as it covers the financial institution’s investment. One of
the factors determining the monthly premium is the replacement value of your
property. Most financial institutions offer this coverage, however, it is
advisable that you shop around for an offer that suits your needs and
your pocket best.
It is important to note that homeowner’s
insurance, otherwise known as building insurance, does not cover the contents
of your home. Therefore, you will need to also apply for home contents
insurance should you wish to insure your personal possessions.
Everything inside a house that can be
taken with you the day that you permanently move is known as its contents, and everything that is fixed - from any built structure like the
main dwelling, garage, walls and fences to fixtures like an air-conditioner,
pool pump, intercom system and geyser – will be covered under building
insurance. Most insurance companies will offer reduced insurance premiums if
you combine your home contents, vehicle and building insurance. Click here to understand the benefits and save money.
Get a quote on
combining your building and home contents insurance and save.
If you’ve found your dream home, then
there are some strongly advisable checks you should consider conducting, prior
to putting in an offer to purchase.
Marius Steyn, Personal Lines
Underwriting Manager at Santam – SA’s leading short-term insurer -
suggests conducting a home inspection prior to purchase, then putting in a
clause that an offer to purchase is subject to stipulated repairs.
“Remember, your insurer is only
responsible for damages occurring from the date of registration of your new
home at the deeds office, onwards – not for any prior problems. This means you
need to have any damages fixed by the seller, as a condition of your offer.
Otherwise, these could become big issues down-the-line.”
Conduct a home inspection prior to
purchase, then put in a clause that an offer to purchase is subject to
stipulated repairs.
So, what essential checks should a
first-time buyer conduct?
You need to know your property is
structurally sound, safe, damage-free and up-to-code. Remember, you are fully
entitled to include a home
inspection clause in your contract,
which makes your offer conditional on a home inspection being conducted and the
property being found to be in a satisfactory state. However, it’s worth noting
that including this clause can sometimes make an offer less desirable for a
seller – especially one who knows there are things that need
fixing!
Here are five areas of the
home to potentially focus on:
1.
Check the geyser: Have the
geyser inspected by a registered plumber in order to establish the general
condition and the adherents to regulatory requirements. The general replacement
cost of a standard size geyser amounts to approximately R8 500. When bursting
or leaking it has the potential to wreck a room, so you need to be sure you’re
getting one in tip-top condition.
2.
Check the roof: Are the
tiles cracked? Have the roof inspected by a registered builder to determine the
general condition of the roof. The state of a roof and gutters can indicate a
lot about the general maintenance of the home as a whole.
3.
Check the ceiling: Most
ceilings have secrets. Look especially hard for mould, or maybe fresh paint
jobs to hide said mould or damp.
4.
Check the garden: If this
is lush and green, be careful. How much will you need to spend to maintain it?
Is it drought-friendly given certain parts of SA’s ongoing water issues?
5.
Check for electrical
faults: Electrical faults will be identified with the issuing of the
electrical certificate, which is the responsibility of the seller. Any repairs
or shortcomings identified in this investigation would also be the
responsibility of the seller.
Steyn advises having a professional
inspection and taking a family member or friend along, who has experience and
knowledge in spotting potential structural problems.
A few insurance considerations for first-time buyers:
1.
Make sure you get homeowners
insurance (this covers the building)
and house
contents insurance (this
cover the contents within your home) a few days PRIOR to moving in. Your first
seven days in a new house are when you’re most vulnerable, because you’re
usually still figuring out security and all your things are in boxes. So, make
sure your insurance is already in place. You can also request to have certain
security features installed before moving in – especially those that are
essential to meet your insurer’s stipulated conditions – like burglar bars, an
alarm, etc.
2.
Make sure your home
contents insurance is adequate and the equivalent to the new current
replacement value of all your items.
3.
Remember you have a duty of
care as the policyholder. Should a theft occur, you need to do everything you
can to limit the damage – so ensure your front door is fixed and secure if it
was damaged through forced entry, for example. Additionally, report any items
stolen to the police and your insurer. With the approval of your insurer you do
have a prescribed time to do a proper inventory of everything taken.
It is importance to making sure that
all damage is fixed up before you move in, as a condition of your offer.
Do not purchase a property (home) with damage. Rather include a clause in the
purchase contract that seller must repair the specified damage before
registration can take place.
For assistance with your Home and
building insurance phone 031-5021922 or click here to go to our
website.
Article courtesy of Property24