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The impact of a Budget on a homeowner

The impact of a Budget on a homeowner

In this current turbulent economy, creating and sticking to a personal budget is a fundamental step towards really managing your money effectively and avoiding debt. This requires time and discipline – you will need to honestly examine your income, spending habits, and debts, and make some key decisions about how you will spend your money going forward.

 

The word budget might bring on negative feelings in some; they associate it with restrictions and a lot of hassles. “With a budget, you can begin to prioritize your spending and better manage your money and financial future. Instead of viewing a budget as a negative, view it as a tool for achieving your financial goals, and a step closer to owning your new home or even a second home” says Craig Hutchison, CEO Engel & Völkers Southern Africa.

 

You may perhaps feel like you do not have any funds to budget with, and that each rand already has its allocation. However, keeping a budget might highlight areas where you would never have suspected an over spend. Budgeting is simply the process of creating a plan of how and where to spend your money that you receive, by balancing your expenses with your income.

 

Benefits of having a budget and sticking to it

A budget is there to enable you to get a hold on your spending and save where you can, and it will also keep you out of debt or help you work your way out of debt.

 

It gives you control: If you feel like you are not in control of your money and you are constantly wondering where it went and what happened to it, budgeting can put you in control. When you budget wisely and understand where your money is going, you will feel more in control and at ease with your financial situation.

 

Puts the brakes on spending what you don’t have:  It forces you to work with the money you have – you’ll know exactly how much is coming in this month, how much you need to spend and save and how much you have left over. It will discourage you from relying on credit cards to make unnecessary purchases and end up with major debt problems.

 

Work towards your dreams: It teaches you to save first and to decide what to save for. This will help you to map out your life goals and you can focus your money on the things that are most important to you. You will find it easier to turn down impulse buys and to put your money where you really need it. This may be getting out of debt, saving up for a home or working on starting your own business.

 

Prepare for emergencies: An emergency fund should cover 3 – 6 months of your living expenses so that you can survive until you are back on your feet. Don’t try to save this fund all at once. Rather, build a payment plan into your budget and start growing the fund as soon as possible.

 

Keeps your credit score healthy: 35% of your credit score is based on your payment history, while 30% is based on your debt-to-credit ratio. By paying your bills on time and paying down your debt, you’ll boost your credit score considerably, which means that you’ll have an easier time qualifying for loans with lower interest rates when you need them.

 

Tips for starting a budget

  1. Gather every financial statement you can. This includes bank statements, investment accounts, recent utility bills, and any information regarding a source of income or expense.
  2. Record all of your sources of income.If you are self-employed or have any outside sources of income, be sure to record these as well.
  3. Create a list of monthly expenses.Write down a list of all the expected expenses you plan on incurring over the course of a month. This includes a mortgage payment, car payments, auto insurance, groceries, utilities and entertainment – essentially everything you spend money on.
  4. Break expenses into two categories: fixed and variable.Fixed expenses are those that stay relatively the same each month. Variable expenses are the type that will change from month to month.
  5. Total your monthly income and monthly expenses.If your end result shows more income than expenses, you are off to a good start. This means you can prioritize this excess to areas of your budget or pay more on credit card balances to eliminate that debt faster. If you are showing a higher expense column than income, it means some changes will have to be made.
  6. Make adjustments to expenses.If you have accurately identified and listed all of your expenses, the ultimate goal would be to have your income and expense columns to be equal. This means all of your income is accounted for and budgeted for a specific expense or savings goal. If you are in a situation where expenses are higher than income, you should look at your variable expenses to find areas to cut. Since these expenses are typically non-essential, it should be easy to shave a few Rands in a few areas to bring you closer to your income.
  7. Review your budget monthly. After the first month take a minute to sit down and compare the actual expenses versus what you had created in the budget. This will show you where you did well and where you may need to improve.

 

Budgeting to buy a home

A good budget plan begins one or two years before the buyer makes an offer. Having a monthly budget has more advantages than simply making sure you have enough in the bank to cover your bills – it can also help you determine how much house you can afford.

 

Here are four tips for renters who plan to become homeowners:

  • Build strong credit and raise your credit score – The most important focus for all potential buyers should be improving their credit score. A low score can prevent someone from buying a home or at least from qualifying for an affordable mortgage rate. To improve credit scores, buyers should pay off past-due bills, pay every bill on time and reduce their balances to less than 30% of the credit limit on every account. It is best to have three to five credit accounts, such as a car loan, student loan or credit card, for one year or longer.
  • Reduce debt – while buyers increase their savings, they should also reduce their debt. Paying off debt tops saving in terms of priorities because of the interest payments on the debt, which exceeds the amount of interest they can earn on their savings. Lenders want to see that you are managing your debt and keeping your credit card balances low.
  • Practice making house payments – future homebuyers are encouraged to make “virtual” mortgage payments as a way to build up savings and learn to budget for actual mortgage payments down the road.

Keep an eye on DTI – debt-to-income ratios are an important element in a loan approval. This ratio compares minimum monthly payments on all debt to gross monthly income. If your debt-to-income ratio is over 50%, you need to pay off your debt before even thinking of buying a home.

 

 

What should you budget for?

Hollard lists some of the major expenses, to help you prepare for the other costs associated with your new dream home:

  1. Deposit

Banks typically require a 10% deposit on the purchase price of your home, but this can be as much as 30% depending on your credit rating. If you are in the market to buy, you’ll need to have a deposit in hard cash. It is paid upfront and once-off to the transferring attorneys.

  1. Initiation fee

This fee is charged by the bank at the start of the loan (if you take out a bond).  It can be paid upfront and as a once-off fee, or capitalised to your loan amount.

  1. Transfer duty

After your deposit, the transfer duty is one of the biggest upfront and once-off costs to consider when buying a property. Transfer duty is a tax levied by the government and no property can be transferred to a new owner if this is not paid. The only time transfer duty is not payable in a normal sale of property is when you are buying from a registered VAT vendor (developers as an example), in which case VAT is included in the price. The higher the value of the property you buy, the higher the percentage of duty payable. Property transactions below R900 000 are exempt from transfer duty.

Tip: See SARS website for transfer duty rates based on property price categories.

  1. Transfer costs

Transfer cost is the professional fee that the conveyancing or transferring attorney charges in a property transaction to register your ownership of the property with the Deeds Office, protecting your legal title to the property. This is paid once-off before registration and is not to be confused with transfer duty.

  1. Bond registration costs

For the bank to make sure that they have some form of security over the property you have taken a loan on, they will register a mortgage bond that confers certain rights on them. This bond is registered at the same time as the transfer of the property and is done by the bond registration attorney, an attorney on the bank’s panel. Similar to transfer costs, this attorney will also charge his professional fee for registering the bond, which the buyer has to pay.

  1. Occupational rent

This is a fee that is payable only if you take occupation of the property before the transfer of the property into your name has been registered. The rate is usually stipulated in your Offer to Purchase.

  1. Moving costs

Shop around for the best rates and service, and remember that typically month-end is busiest and more expensive. Some removal companies offer special pricing during off-peak times, so don’t be afraid to ask.

  1. Protect your finances with a Home Warranty 

Research shows that most defaults on home loans occur within the first 18 months from when the loan is taken, because this is likely to be the time you’re most financially stretched and can least afford costs associated with hidden defects. Hollards Home Warranty addresses the issues around defects, with a professional property inspection that is coupled with an insurance policy. This protects you as the buyer against the financial ramifications of any hidden defects that may emerge in the property for two years after taking transfer.  The cost of the warranty is covered by the seller – all you have to do is ask for it in your Offer to Purchase.

  1. Homeowners and life insurance 

The bank will require protection to ensure that the value of their security on your loan, the house, remains intact. To achieve this, the bank will require that you take out two types of insurance which need to stay in place for as long as you have the loan with the bank.  The first is homeowners’ insurance which protects the bricks and mortar of the property against an insured peril such as fire, flood and so on. The second is life cover which in the event of the death of the property owner or bond holder, the insurance will settle the outstanding bond amount so that your family is not lumbered with the debt you owe to the bank.  In both instances, you have the option to take this insurance through the offering via your bond provider, or through your current preferred broker or insurer. It is often worth comparing and shopping around to see where you get the best offer. Where you do not use the bank’s offering you will need to provide proof of external insurance.

  1. Contents insurance 

Although not obligatory, it’s highly recommended that you insure the contents of your home against loss or damage as a result of theft or burglary and other perils such as fire, flood and extreme weather conditions.  This insurance is often combined with homeowners insurance, and if you have car insurance, with one insurer, this usually results in a much cheaper combined premium.

  1. Rates and taxes

Once the transfer is completed, you will need to register for rates and taxes as well as your water and electricity services. The municipality will require a deposit – the amount varies from municipality to municipality and is linked to the municipal value of the home.

  1. Total cost of ownership

Owning a home comes with on-going costs such as electricity, water and refuse removal (on your municipal account), garden and cleaning services, maintenance, painting and so on, which all need to be budgeted for.

 

 

If you need help, there are various tools to help you get started on the road to financial freedom, and if you are planning on buying a property a real estate agent might be one of your best. They can precisely give you the breakdown of what you need and eliminate any hidden costs along the road which could cause your new home bliss to quickly turn into a nightmare. Prevention is always better than cure.

 

Engel & Völkers Pretoria New East – Who is behind the door?

Engel & Völkers Pretoria New East – Who is behind the door?

This January Engel & Völkers Pretoria New East celebrated their 6th Birthday as well as their 2nd year under the helm of the new Licence Partner, James Verwey. Chantalle Bell, Feature Writer of Engel & Völkers Southern Africa had a chat with him to gain some insight into his life, his interests, his outlook on the business and industry, and what plans he and his Team Leader, Mariëtte Schoeman, have for the future.

 

The professional side of James

James spent his childhood in Stellenbosch and later matriculated from Menlo Park High School Pretoria, where-after he returned to Stellenbosch to study Law at the University of Stellenbosch. He never practiced Law and opted to take up a unique career opportunity with Toyota South Africa as one of their first Graduate Management Trainees. His career grew rapidly over the 10 year period he spent with them and received great exposure and experience in the corporate business world.

Wanting to revisit his plans for the future, the next year was spent on a sabbatical traveling all over Europe and Southeast Asia, also opening his eyes for international opportunities. During these travels, he got exposed to Dubai and when a great opportunity there presented itself; he decided to join the Toyota and Lexus group of companies in Dubai as Marketing Manager. After another 10 years, he decided to semi-retire back to South Africa and purchased a guest house in Paarl, which he still owns today.

Whilst operating the guest house, another major automotive group in the Middle East approached him to head up a new company in Abu Dhabi, Premier Motors. Premier Motors is the sole agents for premium brands like Ferrari, Maserati, Jaguar, Land Rover and Ford. James filled this position for 9 years and it grew into one of the largest and most profitable motor companies in the United Arab Emirates. After almost 20 years in Dubai, James decided to return permanently to South Africa at the end of 2014.

 

James at home

James is married to Irina, who is originally from Siberia in Russia, and whom he met in Dubai 9 years ago. Irina is very fond of South Africa, particularly Pretoria, which is where they decided to call home upon their return from Dubai. Irina has a passion for gardening and loves to experiment with various flowers and plants, in addition to her freelance career as a Fashion Designer. They visit France annually, where Irina also sells most of her designs. They love traveling, both local holidays as well as exploring unique places. James has a son of 32 (James Junior) who resides in Namibia, which is also one of their favourite destinations.

As for hobbies and in addition to his passion for the real estate business, James enjoys playing golf and to spend time with his family and friends.

 

James & Property

As we have now gathered, James does not let an opportunity pass by, and clearly he is not one to sit and simply enjoy a quiet life. James kept in touch with a friend, Debbie Stevenson, Licence Partner of E&V Broadacres. Not too long into his “retirement”, he phoned her up to gain some insight into the property industry, what E&V was all about and what the business model entailed.

From here on things moved rather quickly. James met with Craig Hutchison, the CEO of Engel & Völkers and as fate would have it, the Pretoria New East territory was available. Within a month the deal was sealed and he took over the Silver Lakes Licence in January 2016. Since then James has acquired 2 further licences for the adjacent areas to have a diverse and large footprint in Pretoria New East, stretching from Moreletta Park down to Silver Lakes.

The property industry seems to run in James’ blood. His Mom (88) and his “best friend” owned real estate company called Gem Properties in partnership with two friends. So it comes as no surprise that when James registered his business, he named it GemProp Real Estate (Pty) Ltd t/a E&V Pretoria New East.

 

Outlook on the industry

James believes that even with the current economic climate, investing in property often presents unique opportunities for investors and buyers alike, whether residential or commercial. James started investing in property at a young age, with help from his parents. He convinced his parents to purchase a townhouse in Stellenbosch; at that stage it was purchased at R 18,000 and today it is worth R 3 million – proof that there is just no investment that grows as much as property does. Over the years, he has built a diverse property portfolio, reflecting his belief and confidence in property investments.

When asked about his outlook on the real estate industry James says it’s a very exciting industry, challenging but rewarding in the sense that knowing you and your team are fulfilling people’s expectations and dreams. It is very rewarding when you exceed clients expectations in finding their perfect property, whether a rental, a first property or their dream home.

 

What happens behind the doors at E&V New East?

About 7 months ago James’ team was joined by Team Leader, Mariëtte Schoeman. James says since Mariëtte joined, a new energy has been evident in the office, professional sales and marketing activities have increased dramatically and there are structured planning processes in place. James’ role is more strategic and supportive by nature and he leaves the day to day operational running of the business in Mariëtte’s capable hands. Mariëtte is also supported by Lyle Landsman, who has been with the operation since inception.

Mariëtte joined the team as she saw the opportunity for growth. Her connection to real estate stems from a historical interest in property as she comes from a commercial property management, residential sales and rental background. She has a keen business sense as she had her own successful landscaping business for 20 years, which she later sold to join the real estate industry.

Within the real estate sector she worked for a renowned estate agency for 8 years and completed her NQF4. Once this was mastered she was ready for a new challenge and she went into Commercial Property Management where she started her studies towards NQF5 & 6 in Commercial Property Management.

Mariëtte joined E&V as Team Leader at the Waterkloof Office where she spent 2 years before joining James’ team as their Team Leader, where she is currently busy with her NQF5 Residential Real Estate.

We asked her why she originally joined E&V and she said “because it’s an international brand and she liked the way the business plan is executed”. As the Pretoria New East office incorporates 3 licence areas, Mariëtte feels the challenge has great development capacity, both from a career as well as an investment perspective. Mariëtte has been given the opportunity and is working towards becoming an equity partner in Gemprop.

Mariëtte states the one thing she has learnt from the industry is that buying and selling property is a very personal and emotional experience and should not just be seen as solely a business transaction.

“The most enjoyable part about the industry is that no two days are the same; however as with anything else in life, it also comes with its challenges as every client is different and presents her and her team with their own unique challenges. Meeting monthly targets and continuously keeping the team motivated under pressure at all times are definitely challenging, but also very rewarding at the same time” she added.

 

What makes a winning team?

Both James and Mariëtte agree that in order to have the ideal and perfect team, the team must have good core values, which are well defined. These core values are also a critical component in the recruitment process – “A Team goes as the Leaders go”.

This, together with a good team spirit and support culture, forms the basis of their operations in striving for excellence. The management team developed an integrated business plan for the next 5 years, all encompassing, from strategic goals, corporate values and SWOT analysis, to budgeting and detailed action plans to execute the finer details of each business activity. The core values are shared with all the staff regularly to ensure all are aligned and positive in achieving their goals.

When asked what would her advice be to someone who is not in the industry and wants to join Mariëtte says, “Join a company that shares and offers you the required knowledge, tools and support to be able to be successful agent”. With all that in place there is a slim chance that an agent will be unsuccessful and then the potential to earn a very good income becomes a reality.

 

Tell us about the area

Pretoria New East is a very diverse area ranging from first time homeowners, developments and plots, to exclusive estates (e.g. Woodhill, Mooikloof and Silver Lakes) in both price and lifestyles. The long-term plan is to have the correct outlets, agents and infrastructure to support the activities with satellite shops. The end goal is to dominate the Pretoria New East in terms of sales, awareness and reputation. This will remain the main focus, backed up by a profitable and premium rental division to compliment the core business.

Exciting times lay ahead for the Pretoria New East area in the next 10-15 years. In anticipation of this, investors and developers are buying plots and rezoning them for residential housing.  Major metro plans for the east is on the cards including a second highway which will be accessed from the N4 through a new R90 million road – the PWV17 – which will link the N4 and the R21, as well as the planned road upgrade for the N4 to link to Graham road directly.

 

What does the future hold?

Even although their team has doubled over the last 7 months, the focus and priority for the year ahead remains on recruitment of agents for all 3 of their licence areas, both qualified agents and intern agents.

James is of the opinion the business is still in a growth phase and requires further exposure to dominate their licence areas. To achieve this, they again need to double the current team – property sales and rental agents, as well as support staff. This is an integral part of the business plan to dominate their market.

If you are looking for a new challenge to take on this year, why not call Mariëtte for a confidential interview on 079 874 5572 and explore the options they have available.

The Cape Town Southern Suburbs: One of the most sought – after addresses

The Cape Town Southern Suburbs: One of the most sought – after addresses

The Southern Suburbs make up some of the most popular residential areas in Cape Town, comprising charming groups of suburbs which lie to the south-east of the slopes of Table Mountain. It is seen as the city’s most expensive residential neighbourhoods with a choice of various private schools, upmarket eateries, wine estates, beautiful homes and trendy apartments.

 

“The Southern Suburbs area is large and varied, and is predominantly residential. It is identified as being the more affluent of the Cape Town Metropolis with incredible family neighbourhoods. The properties vary from large plots of land, to a variety of older-style homes that range from cottage-style semis in Mowbray, Claremont and Wynberg, to more ornate and certainly far larger homes in Constantia, Newlands and Bishopscourt” says Delia Walters, Office Manager Engel & Völkers Southern Suburbs.

 

It boasts the ever popular University of Cape Town which lies on the mountain above Rosebank, Rondebosh, Mowbray and Observatory. When visiting the area there is always something to do to for young and old with a diverse mix of amenities and shopping areas like Cavendish Street, and depending on the time of year, you can even catch a game of rugby or cricket – in Newlands at the side-by-side rugby and cricket grounds, which are the home of the Stomers and Cape Cobras teams respectively. Tourists are attracted by the wine estates, the beautiful botanical gardens, various museums, hiking and walking trails and horse riding trails found throughout the suburb.

 

One can see why the Southern Suburbs will always be in demand and why it commands some of the highest property prices in Cape Town.

 

Average property value

There is no average, but there is certainly something for every buyer. Property values range from R1.2 million for a flat in Plumstead to R55 million for a house in Constantia.

 

Typical property type

As varied as the property prices are so are the homes. From R5 million for a trendy apartment in Upper Claremont to the beautiful palatial homes in Bishops Court and Constantia Upper. There is a combination of lock-up-and-go family homes with large gardens, beautiful cottages dating back to the late 1800’s early 1900’s and ample student accommodation in modern and affordable apartment blocks.

 

Trends and tips when buying property in the Southern Suburbs

Prices in the area will always be on the increase, so try not to be too set on an area or type of house. Delia advises that you consider your budget and then be realistic about what you can afford, you might have to compromise and buy an older home which needs some work in order to be able to afford to live in certain parts.

 

When moving from other parts of the country to the Southern Suburbs it can be quite a shock when you find that R2 million doesn’t really go very far. However, if you are on a limited budget, you do your research, and are prepared to downscale – anything is possible. If you are specifically moving into the Southern Suburbs for the schools, be sure to check the zoning for the school’s first. Real estate agents could be of great help here, so do not be too shy to ask.

 

What does the current market look like?

Buying a home in the Southern Suburbs will always be an investment. High rental returns make it a first choice for investment buyers wanting to grow a rental portfolio. Areas such as Rondebosch and Newlands have an ever increasing demand for student accommodation due to their close proximity to the University of Cape Town.

 

A large percentage are cash buyers due to the high price brackets of the properties, while first time buyers might find it harder to find their dream home at an affordable price. Don’t despair though, there is a property to suit almost everyone.

 

The Southern Suburbs as an investment option

  • Consistent upward trajectory in house prices
  • High rental return
  • High rental demand for students and young professionals
  • Excellent private girls and boys schools
  • Close proximity to the city centre
  • Scenic walks, hikes, equestrian trails and parks focused around a family lifestyle
  • An abundance of restaurants, coffee shops, upmarket deli’s, art galleries and boutique shops
  • A vast choice of modern homes, townhouses, mansions, heritage homes and apartments

 

 

Events to consider if you are in the area:

  • Kirstenbosch Summer festival – every Sunday from the middle of November until the end of March. Live music performances by Prime Circle, The Parlatones, Mango Groove, Lira and Freshly Ground are some of the main acts which can be seen. Bring a picnic blanket and basket and enjoy an evening concert with a glass of wine.
  • Cape Town Cycle Tour 2018 – Sunday 11th March 2018. Where thirty-five thousand cyclists embark on arguably the most scenic cycling race in the world.
  • Two Oceans Marathon 2018 – 31 March 2018. This is by far the most scenic ultra-marathon in the world. It’s also one of the toughest, with the route taking runners over the gruelling Chapman’s Peak and Constantia Nek.

 

Delia’s recommendation of the top 10 things to do in the Southern Suburbs:

  • Kirstenbosch National Botanical Garden is acclaimed as one of the great botanical gardens of the world; few gardens can match the sheer grandeur of this setting against the eastern slopes of Cape Town’s Table Mountain.
  • Rhodes Memorial situated on the Northern slope of Table Mountain, this vantage point not only allows a panoramic view but is one of the few vantage points where both the Atlantic and Indian oceans can be seen.
  • Garden Tour at Cellars Hohenort – the exquisite gardens of The Cellars-Hohenort Hotel, nestled in the verdant winelands of Constantia, Cape Town, is nothing less than breath-taking to see. Colours erupt as Clivias and roses bloom; and countless shades of green blanket the landscape thanks to ferns, delicious monsters, herbs and camphor trees.
  • Relax at the Liesbeek River – The Liesbeek River Project is a community project that has transformed an overgrown wasteland into an area where people can now go to read a book, meet the friends for tea or entertain the children with a spontaneous picnic lunch. Situated on the banks of the Liesbeek, the river is deep enough for children and dogs to have a paddle!
  • Baxter Theatre – as both stage venue and producer the Baxter has received national awards for outstanding local performers and home productions. Classical music, opera, comedy, dance and dramatic theatre is presented throughout the year on a daily basis mornings, afternoons and evenings for all ages and tastes. Seasonal festivals run annually.
  • Constantia Nek Farm – Gordon and Anne Kling own and produce Kling wines on Constantia Nek Farm. Constantia is the oldest winemaking region in the Southern Hemisphere and originated in 1685. Some of the finest wines are produced in this region and regularly received international and local acclaim.
  • Purple Wine Tour – is a free extension of the Cape Town Blue Mini Peninsula City Sightseeing bus (more commonly known as the hop-on-hop-off bus). It explores a few of the wine estates in the Constantia Valley, which form part of the Constantia Valley wine route.
  • Newlands Brewery – nestled at the foot of Devil’s Peak and neighbour to the historic rugby and cricket grounds, is the oldest operating brewery in South Africa and the home of great South African beer.
  • Groote Schuur Estate – Groote Schuur big barn used to be the home of Cecil John Rhodes. The house sits in Rondebosch and was refurbished by Herbert Baker many years ago. This fascinating house is steeped in history, filled with original colonial furniture and is now a museum.
  • South African Astronomical Observatory – up on what passes for a hill, just across the Liesbeeck River from the Southern Suburb of Observatory, is SAAO (South African Astronomical Observatory).  It lies wedged between the River Club and Valkenburg, its grounds home to a number of domes, one of which houses the Victoria telescope, built back in 1897.

 

A list of ultimate favourite restaurants

Spoilt for choice, whether it is fine dining, pub food or the best burgers and chips, there is something for every palate and pocket.

  • Harbour House in Constantia offers beautifully presented dishes and an array of seafood.
  • Bistro Sixteen82 in Steenberg Tokai boasts their signature wines and tasty dishes served with a view.
  • The Square at the Vineyard Hotel in Upper Claremont serves delicious meals for anytime of the day.
  • Rock Sushi Thai – in Meadowridge serves the best sushi; noodle and Thai curry dishes in the Southern Suburbs.
  • Starlings in Claremont, perfect for brunch and quick catch up with friends.
  • Four & Twenty in Chelsea Village Upper Wynberg, a firm favourite for breakfast.
  • Cafeen in Claremont Village, a gem of a coffee shop serving light meals and great coffee.
  • Hudsons in Upper Claremont is a popular spot with students with great burgers and cocktails.

Places to stay in the Southern Suburbs

Catering for families on holiday or short business trips, there is a large variety of accommodation.

 

 

Whether planning a visit or relocating – if you are not familiar with the Southern Suburbs yet, make sure to add it to your list of places to visit this new year.

 

Tips for a sound night’s sleep

Tips for a sound night’s sleep

A comfortable bed doesn’t necessarily mean that you are getting the quality sleep you need; the most important item for a good sleep experience is your mattress. It has been shown that we spend approximately a 1/3 of our lives sleeping, so it is fair to say it is a valuable part of our lives. It is the only time our body gets to repair and recharge itself for the next day’s activities, making it vital to choose the right mattress to feel rejuvenated and not lethargic when waking up.

 

“Investing in a good quality mattress that is perfect for you is significant as it could be quite costly, but if done right, be a valuable investment for years to come. With all the choices available, it could become quite overwhelming, so arm yourself with knowledge before purchasing, do not be afraid to test and to ask what you need to know” notes Tihara Baker, Relationship Manager for Engel & Völkers Southern Africa.

 

If you’re in the market for a new mattress, here is a list of things you should keep in mind when buying:

 

LIFESPAN

Each mattress is unique and can last for as long as it is cared for. If you treat your mattress properly it could easily last up to 7 – 10 years, however this is merely dependent on its maintenance and use.

 

Best brands for longest lifespan: It’s impossible to give a generic answer as to what brand of mattress will have the longest lifespan and be the best for you. It is very much based on the type of mattress you prefer or require due to health reasons, and your own personal comfort preference. Well-known brands include Simmons, Cloud Nine and Sealy.

 

Best type for longest lifespan: Any mattress that is used more frequently will have a shorter lifespan. So for example in your spare room you can maybe buy a cheaper mattress as it will be used less. For the main bedroom, buy a good quality as it needs to last longer. As a basic rule of thumb, air and innerspring have the shortest, memory foam offer mid length, whilst latex types are known to last the longest. However, you need to keep in mind that it will still need to be taken care of and cleaned regularly to ensure optimal a longer lifespan.

CARE TIPS

Read the instructions: Most manufacturers provide specific information on how to care for your mattress. It is always best to follow their guidelines and to understand what the limits are for optimal results and to save you from spending extra money in the future.

 

Protect your mattress: Mattress protectors are the best way to keep your mattress free from dust mites, bacteria, bed bugs and to create waterproof barriers. These covers are great especially when potty-training kids, and for people who tend to sweat in their sleep, to ward off bacteria getting through to the mattress as they are simple to remove and wash.

 

Beds are not trampolines: If you or your kids want to use your bed as a trampoline, this will seriously damage your matrass. Jumping on the mattress can do a lot of damage to its coil unit, comfort layers and foundation. The mattress will become too soft and compressed in no time at all and will leave you with a creaky and sagging surface.

 

Know where to sit: Avoid repeatedly sitting in the same spot for prolonged periods of time. For example don’t sit on the same edge of your bed to get dressed or tie your shoes, as doing so may eventually cause sagging or a weakened edge your mattress could lose its structure prematurely.

 

The Base: A base provides the best foundation for your mattress and ensures that it stays supportive and comfortable for years to come. Most manufacturers recommend buying a base and a mattress as a unit to ensure optimal performance.

 

Rotation: While most new mattress models offer a no-flip design, it’s a good idea to give your mattress a clockwise turn every 3 months to ensure even wear and avoid lumps and bump. Rotating it should be preventive maintenance, not something you try to do later to fix an already uncomfortable mattress.

 

Cleaning: Launder your sheets and mattress protection weekly in hot water to remove irritants like pollen and dust mites. Stains or spills should always be treated with caution – use slightly soapy water and a soft wash cloth to gently blot, never rub the affected area. Avoid harsh chemicals, as they may damage the foams and fibres.

TYPES

Memory foam

  • Consists of at least 5cm of memory foam, over at least 15 cm of support foam
  • Min 10 years warranty, if kept ventilated, clean, and rotated

Pros:

  • Has the unique ability to conform to your body while dispersing your weight evenly throughout the bed. It improves circulation, making it ideal for achy joints, morning pains and restless sleepers
  • Resistant to mould, bacteria, bed bugs, dust mites and many types of allergens
  • Less prone to sagging

Cons:

  • Retain heat, restrict body movement
  • Lack bounce, and have extended break-in periods
  • Fairly expensive

 

Innerspring  

  • A variety of steel coil support systems consisting of springs connected into a single unit or individually wrapped pocketed coils
  • Most likely will need replacing within 7-8 years

Pros:

  • Consumer familiarity and widely available
  • Various firmness and comfort options to choose from
  • Most affordable mattress type on the market

Cons:

  • Heavy and hard to move in order to clean or flip
  • Movements are distributed through the whole surface, if you sleep with a partner, you will feel their movement
  • Because of their underlying layers of wool and fibre, it provides the perfect environment for dust mites to breed without being disturbed.

 

Hybrid

  • Combining two or more different types of support systems, typically sophisticated memory foams with an advanced innerspring system
  • Poly foam is cheap and degrades quickly, so if the bed uses a lot in its base foam, the overall lifespan of the mattress will be shorter than the innerspring

Pros:

  • Reduces the motion transfer that can occur with tossing and turning
  • Cool sleeping surface
  • Less expensive than memory foam mattresses, making them a good choice for budget-conscious shoppers

Cons:

  • Initial off gassing odour
  • Shorter lifespan due to large amount of poly foam
  • Heavy and difficult to move

 

Latex  

  • These are the crème de la crème, and tick all the boxes for quality and longevity. All-latex mattresses consist of all-natural, blended, or synthetic latex.
  • One of the most durable, resilient mattress materials which can last up to 15 years

Pros:

  • Extremely comfortable – this is due to the natural springiness of latex
  • Promotes pain relief and is an ideal choice for those with back pain or joint pain
  • A huge advantage of latex mattresses is their ability to promote proper spine alignment

Cons:

  • Tend to be more expensive than a cheap spring coil mattress or polyurethane (PU) foam mattress
  • Somewhat heavier than many other types

 

Foam 

  • Constructed of different weights and densities of petrochemical-based flexible polyurethane foams or latex rubber foams.
  • Low density foam has a short lifespan where higher density foam means more support and more durability.

Pros:

  • Limited heat retention
  • Adequate motion isolation
  • Affordable

Cons:

  • Too firm for some
  • Relatively thin
  • Below-average edge support

 

Pillow Top 

  • Additional padding sewn into the top of the mattress. This padding can consist of regular foam, memory foam, latex, fibrefill, cotton or wool
  • Can last up to 5-8 years

Pros:

  •  Above average initial comfort
  • Tops that include memory foam tend to have exceptional pain-relief potential
  • Conforming ability

Cons:

  • Not being able to flip the mattress is one of the biggest objections
  • Heat retention
  • The pillow top part doesn’t last as long as the rest of the mattress

 

GUARANTEE VS. WARRANTY

The most reassuring thing about buying a bed or mattress from a reputable retailer is the guarantee and warranty that comes with it. It is great to be comfortable in the knowledge that your investment is protected.

 

For example, if you have bought a bed with a 10 year manufacturer’s warranty, the first 2 years (depending on the manufacturer’s terms), you will be reimbursed in full for any defective workmanship, this is known as a guarantee. The guarantee covers poor workmanship and/or material defects only. The manufacturer will either replace or repair your bed in accordance with their guarantee policy.

 

Tihara explains that your warranty comes into effect as soon as your bed’s guarantee period has elapsed. After this time period, you will be asked to pay a pro-rata cost for any repairs for the remaining 8 years, this is called a warranty. Warranty periods differ between all manufacturers, anywhere from between 1 to 25 years.

 

KEEP MAINTENANCE IN MIND

Rotating and flipping your mattress is not the only important thing it needs to last its full lifespan. Mattresses are home to bacteria, germs, mould and mildew, that can slowly eat away at the mattress materials and could later also start causing allergies. “It is advisable to have it cleaned professionally from time to time, though cleaning it yourself now and again is better than not at all” Tihara added. It’s very important when you clean your mattress to do it with proper cleaning products that it can withstand:

 

Step 1: Vacuum it

Vacuum all the overlapping, narrow paths and the sides of your mattress, to get rid of any dirt namely pet hair and dust that’s accumulated over time.

 

Step 2: Get the stains out

Mattresses typically acquire 3 types of stains: blood, urine, and any other fluids.

 

  • Dried blood stains can be treated by making a paste of 1/4 cup hydrogen peroxide (3%) mixed with 1 tbsp. of liquid dish soap and table salt. Lightly spread this onto the stain and allow it to dry before scraping the residue off. Dab at any remaining stain with a white cloth dipped into hydrogen peroxide, rotating the cloth as the stain lifts off. (Using a white cloth prevents dye transfer from the cloth to the mattress).

 

  • Urine stains dissolve 3 tbsp. baking soda in 236ml of hydrogen peroxide and add a drop or two of liquid dish soap. Dab this solution onto the spot. (Do NOT drench your mattress). If the stain persists, wait until the area is dry then whisk together 3 tbsp. dry laundry detergent powder and 1 tbsp. water to make a dry foam. Lightly spread this on the stain and let it sit for 30 minutes. Scrape the dried paste away with a spoon. Use a white cloth dipped into hydrogen peroxide to remove any stubborn bits of paste. Vacuum the area.

 

  • Other bodily fluids (vomit, etc.) can be removed by blotting the stain with undiluted, unscented household ammonia. (Do NOT drench your mattress).Wipe the area with a clean, damp cloth and sprinkle the spot with baking soda to neutralize the odour and pull out any lingering moisture. Let this dry then vacuum the area thoroughly.

 

Step 3: Deodorize it

Over time sweat can build up. To rid your mattress of foul odours, sprinkle it well with baking soda and gently rub it in with a scrub brush, so it gets into the mattress fabric. Let the baking soda sit for at least 10 min, and then sprinkle another light layer of baking soda over the entire surface and let it sit for a couple of hours. It will absorb any excess odour or liquid from the stain removal process, and leave your mattress smelling fresh and clean. Vacuum the area thoroughly.

 

Step 4: Flip mattress and repeat steps 1-3

 

 

MATTRESS BUYING CHECKLIST

  • How much can you afford? Knowing your budget is a great help, but saving a little more for a superior brand or type of mattress is a better plan. Rather opt for a 10 year long-term investment than having to purchase a new one every 3 years.
  • What size do you need? If you are buying a complete new bed including the base, you must remember to measure your room as you also need to make sure you have enough space, not only for the bed to fit, but also to move around the bed freely. The ideal comfortable space around the bed should be 90cm.
  • Check the warranty and guarantee. This differs from manufacturer to manufacturer obviously the longer the warranty, the better.
  • What type do you prefer? This will depend on your budget, personal requirements and needs as well as your individual comfort preference.
  • Keep your original base in mind. Should you not be buying a complete new bed you will have to find out if your base will it be able to give the mattress of your choice the ultimate support.
  • Keep your weight in mind. A firmer comfort level is generally recommended for individuals of above average weight and build. The recommended mattress for plus-size people should be around 30cm thick; this is because thicker mattresses are able to better contour to the sleeper’s body, providing better pressure relief. Overall, memory foam and latex ranked as the best mattress types over spring beds and typically last years longer.
  • Is the bed long and wide enough for you? Want to know if a mattress is going to be wide enough? Lie down on your back and put your elbows behind your head. Do your elbows touch your partner or stretch past the edge of the mattress? If yes, then you probably need a bigger size. A good mattress fit should give you at least 15cm of space at the foot of the bed.
    • Firm or soft? Be aware that firm mattresses aren’t always better for your back. Contrary to popular belief, a mattress doesn’t have to be firm to be good for your back – there’s a difference between firm support and a firm feel.
  • Your sleep position is also important:
    • Firm – if you sleep on your stomach, a firm mattress will keep your spine aligned.
    • Medium – best if you sleep on your back, as it’ll provide support for your spine, back and neck while keeping you comfortable.
    • Soft – great for sleeping on your side because it’ll support and contour to your body’s curves.
  • Most importantly don’t dial for your mattress – try before you buy. Whoever will be sleeping on the bed should go shopping for the bed. You really do have to lie down in your usual sleep position and give yourself a few minutes to see if it’s right for you. Turn from side to side, evaluate the support level, and make sure you feel relaxed and comfortable in all positions.

 

Are agents still needed in today’s digital age?

Are agents still needed in today’s digital age?

The boom of the digital age has opened up many doors to the way we buy and sell property. In the past we used to pop out and pick up the latest copy of the property magazines available, today we switch on the PC or grab our smart phones as online property portals & Facebook has become the new ‘go-to’ for anything, including shopping for your new home from the comfort of your couch.

 

So selling your own home today should be just as easy right? Not quite… With so many new services out there, how does one know which is the best, most cost effective way to go? Will you opt for acquiring the services of a professional, making use of the latest ‘package’ solutions to come to market, or trying DIY – either or your goal is to get into contact with as many serious buyers as possible.

 

Craig Hutchison, CEO of Engel & Völkers Southern Africa notes that there is more to selling a home than meets the eye. The decision of how to handle the sale yourself is ultimately yours. However, no matter how digitally savvy or advanced we are, there are a few elements to selling or buying property that one cannot bypass. As with any other service, having a professional, experienced agent at your disposal to take calls, manage paperwork, handle the negotiations and processes and decipher the finer details, to ensure a smooth sale will ultimately save you considerable time and money. This does however come at a fee, and it is important to know what you are paying for.

 

It is important to know what your options are when it comes to selling, an unprofessional service could end up costing you so much that you lose all your investment gains. “In most cases this is your most valuable asset and not following a professional approach could potentially cost you a significant amount of money” Craig cautioned.

 

We take a closer look what is required during the sale process…

 

An eye for detail:

It is not always that easy to remove ourselves out of our situation and to imagine what others would see or want – we can so easily get caught up in our own fixations. We all have a personal idea of our homes and what might need fixing or not before we put it on the market. What we would like or, or more importantly what we don’t want to see when looking for a home. This is a very personal opinion and could be quite costly. If seeing a gourmet kitchen appeals to you – consider that someone else might be more concerned about roof leaks or not mind making the kitchen a DIY project themselves.

 

Having an outside perspective in terms of needs to be changed or renovated could benefit you with regards to the sale. Agents should know what is critical when inspecting, they know what buyers look at and they are able to validate why some things have been fixed and why the rest hasn’t.

 

Knowing the market

HomeTimes states that pricing your home according to the listing price of other homes on property search engines in your suburb or street is a bad idea as it might never sell. This is because no two homes are exactly the same, your home is unique. When selling your home, it is not you who will be setting the asking price; it’s the market. Whatever the market is prepared to pay for a home is what it will sell for.

 

Craig shared an example of a price setting situation with us:

You know that the house two streets down was on the market as you saw the For Sale sign, because humans are inquisitive, you phoned to find out that they wanted R2 million. 3 months later, you see the SOLD sign and decide that at that value, you can also look at moving or upscaling. What you don’t know is that before the For Sale sign went up, they had 2 offers which fell through due to buyers not being able to obtain a bond, and when the contract was eventually signed, they received an offer for R1,6m which they accepted. The property also had a gourmet kitchen which yours doesn’t and the loveliest sun room as it faces just in the right direction. No report that you buy will ever be able to give you this information or insight.

 

Agents will get a comparative market analysis done, purchase a property and suburb report and more importantly, after considering all factors, including where the suburb is heading, think like a buyer, seller and bank valuator, all at the same time. Ensuring the seller gets the best price, the buyer gets a solid investment for their future and both are guaranteed on a positive outcome as the banks are sure to find the value.

 

The pitfalls of overpricing:

At any given time there are buyers looking for newly released properties, hence it is vital to price your property correctly from the start. Are you able to determine the market value of your home without overpricing it?

 

Statistics show that 81% of people will value their home more than what it is worth, the other 19% are sure to be in the real estate field. It is a human trait to attach emotion to things. But this emotion could end up taking your home’s value down even lower than what it should be and here is why:

  • Buyers discard the idea of making an offer.
  • Overpriced properties stay on the market for far too long, changing a want to sell to a have to sell – causing a reduction in price and a panicked sale.
  • Buyers are always looking and if your home was listed at Price A, and after 3 months they still see the same property now listed at much lower – would you not also be inclined to think that if you wait, you could snatch a bargain as they are sure to go even lower, or even attempt to put in a low offer in the hope that they are desperate?
  • Where a normal property would sell after 3 months on the market at 98% of the market value, overpriced homes tend to sell after 6 months and at 75% of the market value.

 

Finding your buyer:

How long did an agent take to sell your last home? Many will say ‘1 day or 1 week or even 1 month’ homes “Easiest money they ever made” is often the words used. But this is never the case. Even though your property sold after a week, a lot happened behind the scenes.

 

The average time which a property is on the market for, is 3 months, thereafter is starts to appear as stale stock. If your property stays on the market for too long and the buyers monitor it, they might think there is something wrong and will not even bother to set up a viewing

 

Do you have access to ALL your potential buyers with their needs and to all possible options of properties? Real estate agents spend years building up an extensive database of all potential clients, so that by the time your property is on offer, they already know who is currently looking and are able to match buyers & sellers up quickly.

 

“Agents devote large amounts of their time to finding future clients and building a reputation. In fact, a large share of real estate sales are successful as the result of the agent contacts that have been built up over many years in the extensive database, all resulting from years spent on activities prior to your home being listed” Craig added.

Time = Money

Agent fees are made up out of time, including driving to appointments, time spent on the phone, meeting prospective buyers, promoting and showing the property and canvassing and distributing marketing material. Consider all the ‘to-do’ items which comes with selling a property, and then sit and do the calculations to determine which service is best for you:

 

A simplified, quick overview of the process is as follows:

  • Research the home’s value & determine the price.
  • Conduct an official ‘listing’ process as there are certain legalities you would need to take note of before you go to market.
  • Think like a buyer – write the property’s description, take the photos as to make it most appealing, get all the figures together, including the property assessment disclosure.
  • Start to plan the adverts & marketing avenues. Real estate does not sell from 1 advert – especially not if you do not have access to your buyers already. Activities include area distribution, word-of-mouth, property portals, social media, printed adverts, distribution material, e-mail marketing, sign boards, networking and more…
  • You will need to keep the activities going in order to ensure that you reach all social groups and opportunities which come available.
  • Allow time for various calls and answering the questions which a buyer might have before deciding if they wish to view.
  • If you have a viewing interest, co-ordinate diaries in order to ensure a buyer can come to view. This will have to be done numerous times, and note that if no screening process is done, you might end up even entertaining the local neighbours who are just curious of what the property looks like.
  • Once viewings has been conducted, it is time prepare the contract. Ensure that you have a legal binding agreement, ensuring that there are no loopholes for either parties as one incorrectly phrased clause could cost you hundreds of thousands.
  • Even though a buyer might have indicated they wish to put in an offer, there are still negotiations which need to take place. These come in various forms, it can be in terms of value, extras, occupation, s, furniture or even conditions set.
  • Once everyone is in agreement and the contract is signed, the buyer needs to obtain a bond with various institutions. If this is not done right, then it could cost the entire sale.
  • All securities passed, legal council needs to be obtained to handle the transfer and transaction, documents need to be signed and deposits paid.
  • If there are issues, it is back to the negotiation table and if not, it is time to start co-ordinating the occupation.
  • After occupation, one needs to also allow for possible problems such as incorrect disclosure of property condition, which if it was not done correctly, will need to be resolved between all parties.

 

The Calculation:

DIY: (Total number of hours spent on all the above) x (your hourly salary rate) + advertising fees

Agent: Based on the industry standard, 7.5% of property sales price

Package option: Flat Rate depending on services obtained + ((time spent conducting own viewings & negotiations) x (your hourly salary rate))

 

 

Negotiations:

There are many negotiating factors for the agents to handle, aspects such as the listing price, financing, terms, date of occupation and the inclusion or exclusion of repairs, furnishing or equipment. Professionally trained agents are expert negotiators and will always attempt to negotiate the best deal. Negotiating without a professional agent could be costly and result in lost opportunities in a transaction.

 

Bond Application:

In today’s market where qualifying for a bond is not possible for everyone, it is very important that your prospective buyer is pre-qualified. This ensures that each person who enters your home is a qualified buyer and that you are not wasting your time or exposing yourself to time wasted on clients who will not be able to purchase your home.

 

Buyers can also opt to take their time with obtaining a bond, or deciding not to if they do not get one from their personal bank, which would be their likely first application. This could cost you your sale. You need to ensure that a buyer is assisted and educated, and that this is done as soon as possible so that the sales can be concluded with a quick turn-around.

 

The Legalities:

Do you know what you would need to disclose when clients come to view? It is imperative for sellers to disclose all known defects of their home to their agents before placing their properties on the market. The agents are then obliged to disclose these defects to their potential purchasers. You could run the risk of a law suit if you do not know or alternatively the sale could fall through.

 

Whether you are buying or selling, it requires disclosure forms, inspection reports, mortgage documents, cancellation instructions, insurance policies, deeds and settlement statements. Having an expert to deal with this, will help you work through these processes quickly and more efficiently. Agents do not only help and ease this process, but can also provide you with valuable information of the area such as schools, zoning and plenty more.

 

Education and experience

Years ago, selling property was considered a hobby or part-time job, anyone was able to register and start selling. In 2008 the industry underwent rapid change, and being an agent is now a fully-fledged profession. A Real Estate Qualification is required by anyone who sells property as a profession and you must be in possession of a valid FFC issued by the EAAB (Estates Agency Affairs Board) which takes between 2-3 years to complete, so you can be sure you are in good hands.

 

Agents have years of experience, knowledge and support behind them and without a doubt, know their areas and how to do their job very well. They have already identified any potential problems and solutions with the property in advance and understand the seller’s mind-set, they know the ins and outs and have the expertise, and negotiating skills needed to provide reassurance to the buyers, that they are making the right decision.