You’ve overcome all the hurdles of buying a home. You’ve managed to pay your deposit and your closing payments, and now you’re a proud title deed holder. However, there are other expenses waiting around the corner. Are you prepared?
Justmoney looks at some additional costs that are associated with your home.
Tip: Take the first step to owning your dream home. Get a home loan quote here.
Insurance is king
Insurance is the most important thing that you need to have after purchasing your house or property. This will help in case something unfortunate, such as theft or damage, happens to your property.
According to Mfundo Mabaso, growth head at FNB Home Finance, you’ll need three kinds of insurance to protect your home:
- Home owner’s cover: Your bank requires you to hold a Home Owner’s Comprehensive policy, which covers the structure of your home. Note that sectional titles will be covered by the body corporate and will not require their own policy.
- Life cover: This is required or recommended (depending on your mortgage loan agreement) to protect your investment for your family,
- Household contents: While not generally required by the bank, it’s recommended that you insure the contents of your home.
“The premiums for these covers will depend on your profile, so it’s best to shop around and get quotes to understand what these costs will actually be for you,” says Mabaso.
Municipal rates, taxes, and levies
You will need to pay for your water and electricity monthly, as well as rates and refuse removal. If you’re in a sectional title or an estate, you may also be required to pay monthly levies for the upkeep and management of the communal property.
“A good idea is to speak to your new neighbours to see what their monthly costs are to get an idea of what you should expect to spend. Or you could ask the current owners for copies of their monthly bills for you to compare,” says Mabaso.
He recommends that you consider installing a prepaid meter to get more control of your spend.
Think about maintenance
Owning a home requires constant investment – that could be doing repairs, improving the house, or making changes.
“Be prepared to spend something each month, or save a bit each month towards keeping your home up to standard and keep things in working order,” says Mabaso.
Safety and security
Protecting yourself from break-ins doesn’t only save you from trauma, it also saves you the money that you would otherwise pay towards your insurance premiums.
However, saving money sometimes also means spending money. Installing a good security system will ensure that you and your possessions are safe, but it will cost you.
“Think about what your new home will need and make sure you will be able to take on the additional expenses,” says Mabaso.
Justmoney can help you make sure that your home is protected in the event of theft, fire, and any other damages that may occur to your home. Click here to get a home insurance quote.