Greenleaf Property Developers

At the moment purchasing property may seem impossible for many South Africans.

"In order be able to buy property, people need to get back to basics and start saving for the house they want to purchase," says Marsha Haupt, sales director at Betterbond.

Saving may be difficult under the present market situation with conditions such as high interest rates and fuel prices eating away at everyone's pocket, but saving is possible no matter how little you may start of with.

Haupt provides some tips for first time homebuyers on how to save to buy a house of their own.

Once a potential homebuyer has made up their mind that they want to purchase a home in the near future, the very first thing they should do is look around for a house that they might want to purchase. In order to be able to plan effectively to buy a house people need to have a "feel" for how much they need in order to be able to purchase a home in that range.

To save money is to get into the habit of taking funds and placing it into an account where it cannot be accessed immediately. Banks offer a variety of packages and it is a good idea to look for a saving option that offers the best interest rates for very little risk. Some good examples are 32 day notice and fixed accounts.

The next step is to look at expenses that can be eliminated, such as satellite television, new clothes, eating out and trips to the hairdresser and nail salons. Cutting down on cell phone usage as well as getting rid of credit cards will also be extremely helpful. By downsizing current living expenses and putting aside any lump sums of money, such as tax refunds or bonuses, will get a person that much closer to a home of their own.

It is essential to remember that the bigger the homebuyer's deposit is, the less they will end up being billed in interest over the long term.

For those who are in a position to do so, it makes sense to purchase a property with a friend or spouse as banks will view the transaction as a better risk because of the joint income. It is however essential to be aware of the risks, such as if the relationship ends. It is wise to have a legal contract drawn up stating each party's obligations, how much each will pay and the split which is usually 50/50.

Potential homebuyers should take note of the following points, in addition to the guidelines mentioned above:

- When you do shopping, write a list and stick to it.
- Cut down on outside entertainment and vacations, rather stay home and rent a DVD or invite friends over for a "bring & braai".
- Let friends and family know that you are saving to buy a home. This way they will understand if your birthday and other gifts aren't as extravagant as they once were. Put the extra money you would have spent into your "home" savings account.
- Sell off things that you don't really need or use anymore, such as the exercise bike that has been sitting in the garage for two years.
- Get a part time job and save the income for your home. Even if the job is every other weekend, the extra income will help.

It is not practical to buy a house or aim to buy a house that a person cannot afford. A good idea is to speak to the bank and determine what exactly is affordable and stick to it.

For someone wanting to buy a home, purchasing that home should move to the top of their priority list – when something is that important, people are willing to make sacrifices. And once someone has a vision of the home they want, nothing and no one will be able to stop them from saving for it.