Buy instead of rent?
You're currently a tenant and are trying to determine whether you want to buy your own residential property. We'll help you assess the possibilities.
by Gaby Hophan
The acquisition of residential property has many and varied consequences. The best approach is to go through these different aspects one by one.
1. Are you ready for your own home?
First of all ask whether your personal mid- to long-term plans make you at all suited for your own home. Someone suited to owning a home leads a stable life in every respect (private life, occupation) and is in a position to take on long-term financial obligations of a considerable amount and is generally ready to do more work (e.g. the garden).
2. How solid are your finances?
Ask yourself whether you can afford to buy your own home at all. Before approving a mortgage, banks require that you provide 20 per cent equity participation. In addition, you must be able to carry the mortgage debt, interest payments as well as ancillary and maintenance costs over the long term.
3. Be clear about your requirements
Create a list of requirements you want in a new home, best done so in the form of a checklist.
4. Study the real estate marketplace
Take a close look at the real estate marketplace for suitable properties and determine for yourself which ones you might like and what you can afford. Attention - reading real estate adverts is a skill unto itself!
Set up a meeting with a bank advisor early on and run through all the calculations.