Signs that you are ready to get out of the rental market
RE/MAX of Southern Africa helps aspiring homeowners decide whether it's time to move out of the rental market.
For many, renting is a necessary step on the journey to homeownership. However, there comes a time when taking the leap from tenant to homeowner becomes the logical next step. If you find yourself questioning whether you are ready to buy, here are some key signs that indicate it may be time to leave the rental market behind.According to Adrian Goslett, Regional Director and CEO of RE/MAX of Southern Africa, “The decision to buy a home should be based on a combination of financial readiness and long-term lifestyle goals. If you are in a position where purchasing a property aligns with your financial stability and future aspirations, stepping out of the rental market could be a smart move. Owning a home not only provides a sense of security but also allows you to build a tangible asset over time.”
For those who are unsure if they are ready to take the big leap into property ownership, RE/MAX of Southern Africa shares a checklist to help aspiring homeowners decide whether they are truly prepared.
• You can comfortably afford a home loan
One of the strongest indicators that you are ready to purchase a home is financial stability. If you have a steady income, minimal debt, and a good credit score, then it may make more financial sense to invest in a property rather than paying towards someone else’s asset. A simple guideline is the 2.5 to 3 times annual income rule, meaning you should aim to buy a home that costs no more than 2.5 to 3 times your annual gross income.
• You have enough savings for additional costs
Buying a home requires more than just a loan approval. It can be beneficial to have enough to put down a deposit - typically around 10% to 20% of the purchase price - as well as additional funds to cover transfer duties, legal fees, and moving costs. If you have managed to save enough to comfortably cover these expenses, it is a strong indication that you are financially prepared for homeownership.
• You are ready for a long-term commitment
Unlike renting, where you can move with relative ease, owning a home is a long-term commitment. A rule of thumb is that you need to live in a home for around five to ten years to reap the full benefits of house price appreciation and enjoy a good return on your investment. If you are planning to stay in a particular area for the foreseeable future, purchasing a home can provide long-term financial security and stability.
• You seek greater freedom and stability
Owning your home means you no longer need to worry about lease renewals, rent increases, or landlord restrictions. You have the freedom to renovate, decorate, and personalise your space as you wish. If you are seeking a sense of permanence and the ability to make a space truly your own, homeownership may be the right choice.
• You understand the responsibilities of homeownership
Owning a home comes with additional responsibilities such as maintenance, repairs, and municipal costs. If you are ready to take on these obligations and manage the upkeep of a property, then you may be ready to transition from tenant to homeowner.
“Transitioning from renting to homeownership is a significant milestone, but it should be approached with careful consideration. If you find yourself answering yes to the points above, it might be time to take the next step and start exploring your options in the property market. Reach out to your nearest RE/MAX office to get some free guidance and to see if you truly are ready to take the next step,” Goslett concludes.