Monday, 18 February 2008

Buying a home as a foreign national in South Africa

Foreign investors S.A.
It's a question that I get asked over and over again and for some reason have failed to post anything on it. It's also a topic that is not easy to find anything on?

I'm also pretty tired of estate agents informing clients incorrectly (I won't mention any names but you know who you are) and then leaving it up to us poor bond originators to sort out your dirty work!

SO HERE IT IS!

Scenario 1:

I'm non South African citizen living abroad looking to invest in South African Real Estate. What mortgage amount do I qualify for?

Non residents and Non S.A. citizens qualify for a 50% loan. The banks require a 50% deposit to be made from a non South Africa banking account upfront, prior to the loan being granted for 50%.

I'm a non South African citizen living and working in South Africa. What mortgage amount do I qualify for?

Non S.A. residents working and living in South Africa whether permanently or on contract (Depending on contract period - varies from bank to bank) qualify for loans of between 60% and 100%. The going rate and what we average is 80%. My Suggestion, is don't even apply for 100% loan if you can avoid it. Rather put a 20% deposit and your chance of getting the mortgage increases ten fold. DON'T EVEN BOTHER GOING FOR A MORTGAGE WITH TRANSFER AND REGISTRATION COSTS INCLUDED!!! YOU WILL NOT GET COSTS INCLUDED. Estate agents will try and convince you that this is possible, it's not!

The only time you can apply for costs in your home loan and you're a foreign national. This is not 100% guarenteed and the banks don't really like giving costs.

1. You have South African citizenship and you're a first time home buyer.
2. Your husband or wife is South African and you're a first time home buyer.

Make sure that before you believe what the Estate agent sells you!!!! That you do your homework first. Remember once you've signed that Offer to Purchase you're legally bound.

WizardMan Out!

3 comments:

mak said...
This comment has been removed by a blog administrator.
Anonymous said...

I recently started expanding my investment portfolio to include foreign real estate. After purchasing a home from www.buysafecostarica.com I am interested in knowing if there are sites similar to this for the South African market. Essentially they are listing site for numerous real estate agents. Any info on how to locate properties for South Africa would be much appreciated.

Anonymous said...

Hi,

Thanks for your comments. Yes I do have some sites for you...

http://www.homesouthafrica.com
http://www.myroof.co.za
http://www.privateproperty.co.za

Those should get you started.