AWCI –June 2017 – AWCI Property, a black women-owned full-service property group has taken an assertive step forward in providing a pre-approved home loan service specifically for the black market. As a property group on the rise, AWCI aims to educate black people on the value of property ownership over a culture of consumerism.
Rhoda Grootboom, Executive Director of AWCI Home Loans explains, “Despite South Africa being downgraded to Junk status by investment agencies, S&P and Fitch, people need to understand that the interest rate remains unchanged, and property is still a steady investment offering the best return over a 20 year period. Your property is an appreciating asset, its value increasing over time.”
Grootboom explains that because the prime lending rate, (which is the interest charged by banks to clients), will stay fixed at 10.5%, potential black property owners need to understand that pre-qualification for a home loan gives them the buyers’ advantage on the property market.
“Generally, the pre-qualification process seems arduous with the amounts of information that needs to be exchanged, but at AWCI our prediction formula means we have a 95% success rate when it comes to securing pre-qualification for our clients,” says Grootboom.
In the current economy, potential property owners fear bond repayments, but Grootboom believes that this is simply based on a lack of information. For example, most people are not aware that two single people who are friends can apply for a ‘shared’ bond.
“Co-signing on a home loan is one of the best ways to share costs while cementing a long term financial investment. We work with our applicants to draw up a monthly budget that way they know how much they can spend on a home.” Grootboom adds, “A R1 million home will appreciate two times faster than a high-end property. Taking into account the average repayment on a R1 million bond over 20 years will be approximately R10 000 per month, that expense will be halved if the bond costs are shared between two people.”
According to FNB research, average house price growth with be around 3% in 2017, however, it can rise as much as 5% in upcoming years. So if your home costs you R1 million, next year it will be worth R30 000 more by the year’s end, proving that even in a buyer’s market residential property is still a sound investment.”
According to Grootboom, the company has been so successful in their pre-qualification services, that they are able to convert 80% of their pre-qualified clients into home owners. “Over time we have seen some of our clients come back to us for investment properties for rental income etc. once again we advise on pre-qualification which will give them the buyers clout they need in 2017.”
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