IT IS NEVER TOO LATE TO BUY YOUR FIRST PROPERTY

Even if your golden years are on the horizon and you still rely on a landlord for the roof over your head, you are not necessarily doomed for retirement. Granted there may be additional hurdles in securing a home loan at an older age, but it is not an impossible feat. Market figures for 2018 show that the average age of the first time buyer in South Africa is 34 to 35 years old, says Nondumiso Ncapai, head of product at Absa Home Loans. That said, it is never too early or too late to buy a home as this decision depends on one individual affordability and life stage need. Ideally though, a bank would want to ensure that a client is not older than 75 when the bond is paid up. "Although there is still opportunity to lend to customers who are 50+, it may be harder to be granted a bond after the age of 65." Ncapai emphasises that applications are taken on a case by case basis and decisions are based on a risk assessment. "If a bond is taken at age 65 with the aim to have the debt expunged by the age of 75, the loan term would be reduced significantly, consequently increasing the monthly instalment." Retirement income would need to be proved to support the lending and there is a likelihood that this income level would be below the previous salary level, she adds. The average age of BetterBond's first time buyers is 35 although it is not uncommon to receive applications from buyers of all ages, including those above the age of 50, says BetterBond regional manager Stephen Whitcombe. " Banks will usually want the age for full repayment of the bond not to exceed 60 to 70 years old so a 60 year old buyer, whether first time or repeat buyer, would probably only qualify for a 10 year term, making the age 70 upon the final repayment of the home loan being made." Reducing the term, of course, increases a customer's minimum monthly repayment and, therefore, affects affordability, Whitcombe says. At FNB, a fraction of the deals registered in the past year were from buyers above the age of 50, says Mpho Ramatong, FNB home finance division channel head. While the oldest age of first time buyers varies from bank to bank, they usually range from 55 to 66 years old. The standard cut off time for application, though, is five years before retirement. "It is a requirement that by the time the buyer goes on retirement the home loan needs to be settled." This does not necessarily mean that it gets harder to have a home loan granted at an older age, Ramatong notes. She explains that the bank grants home loans to customers of any age, subject to affordability, with the condition that the loan has to be paid up by the age of 75. It is not uncommon at all for buyers to be purchasing in their later years as it is often then that they are beginning to reap the rewards of years of hard work, says Sabrina Errico, broker principal for Lew Geffen Sotheby's International Realty in Ballito. Sometimes they even build their dream homes. Errico says retirees and older buyers are migrating to the North Coast for the more relaxed lifestyle in their retirement and the warmer weather. With the need to downsize or invest in security, often lock up and go properties within estates are the properties of choice. There is, therefore, no age limit as to when someone can buy their first home, although they would need to comply with the lending process if they are looking for a bond. Without the need for a bond, though, there is no maximum age for home buyers and there is no stage when anyone has missed the boat. There are also many reasons why people do buy later in life, including moving around for employment, working abroad, saving money, or inheritance. Indecision in the country is also a reason why people may have held back on investing earlier in life. But while there is no correct age to buy, Errico does not recommend they climb on the property ladder later than necessary. "Rather invest smartly early on in life and keep climbing the ladder each year."