Buying a home for the first time can be stressful and expensive. And thanks to stagnant salaries and the skyrocketing prices of fixed costs like higher education, health care and rent, buying a home remains a pipe dream for most Ghanaians.
But the working class who are able to purchase a house are making one crucial mistake: They're jumping straight to large new homes without considering smaller models or previously occupied ones. Most are getting caught up in the allure of a certain neighbourhood or the grandiosity of a big, modern home.
Few tips below...
1. Don't spend too much
While your mortgage company may stop you from spending way too much, it may not stop you from stretching your budget further than you should. When deciding how much to spend on a home, there are two main considerations. The first is how much you're willing to sacrifice in order to have the home you want. The second is whether you'll be able to pay the mortgage if your employment and/or income changes.
Be conservative in both cases. You don't want to eat indomie/noodles or 'kofi brokeman' for a decade, even if it seems romantic at first. You also don't want to risk losing your house if you lose your job or take a pay cut.
2. Don't spend too little
And of course, moving every year has its own costs. Simply moving your stuff from place to place is expensive, and there are all sorts of fees and taxes involved with a move, as well as real estate commissions when you sell.
3. Work with a realtor or developer you trust
Your realtor can help you navigate buying your first house.
4. Be prepared to get a mortgage
The hardest part of buying, aside from finding the house you want, is getting a mortgage. You should start preparing to get one long before you begin looking at houses. That means getting your finances in order, having your two most recent pay stubs ready, and digging up your tax returns forms from the past two years. You will also need to share bank statements from at least two months.
5. Get your credit in check
Aside from income, your credit score may be the most scrutinized piece of data mortgage companies look at. As soon as you even think you may want to buy a house, 'clean' your credit score. Check for mistakes in your report and look for areas where you can improve. It's possible to raise your credit score by doing a number of different things, but an obvious one is making sure you pay off your credit card balances.
For salaried workers in Ghana, most (if not all) loans that appear on your payslip must be paid off or reduced.