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Property in Johannesburg Get a Pre-Approved Loan

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The eternal pessimists in South Africa are still predicting that property in Johannesburg and around the country is in for a huge collapse with some people predicting up to a 50% drop in property prices. The problem is that although this is theoretically possible it is unlikely to happen and most property owners are still seeing growth in their investments over the long term regardless of these rumours.

The property prices in Johannesburg did however go through a slight dip due to the recent worldwide recession. However, even this dip was nothing like the pessimists predicted and property prices are already recovering quickly along with the economy.

Another change that has been seen in property sales is that it is taking much longer to sell a property than was possible before the recession. This however has very little to do with the naysayers predictions and more to do with all the legislation that has been introduced by government with regard to the sale and purchase of property in Johannesburg.

One of the legislated Acts that affect property sales is strangely enough the National Credit Act. As most people in South Africa require financial assistance when purchasing property the Act can determine the success of a purchase. One of the main precepts of the Act is that no credit or loan provider may grant a loan amount or credit facility in excess of what a person can afford to repay comfortably.

This means that most financial institutions need to determine what repayments a person can afford according to their current income and expenditure. These repayments are then worked back to the total price of a house that a person can afford to purchase. The rules and regulations regarding the repayment of a loan have also been tightened up significantly because of the current economic climate.

Financial institutions offering home loans and mortgage bonds are required to request a cash deposit from the potential purchaser of property in South Africa. This deposit is normally in the area of around 20% of the total purchase price of the property but can vary at the discretion of the financial institution.

Make sure that you do you research and get a pre-approved loan amount from a financial provider before you start looking for property in Johannesburg or you could run the risk of falling in love with a property only to find out that it is out of your price range.

If you are looking for reliable, friendly and professional estate agents in Johannesburg to make your house hunting easier, take the time to contact RJD Properties. Set up an appointment with a professional agent in your area today.

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