Housing and interior Flashcards
(32 cards)
What is a lessee or tenant?
It is the person that is renting a house or flat.
What is a lessor or landlord?
The owner who lets out the property.
What is a lease or lease agreement?
An agreement or contract between the landlord and the tenant.
What is full title ownership or freehold?
The buyer becomes the legal owner of the entire property, the plot as well as the structure on it.
What is a sectional title?
The buyer is the legal owner of a section of a housing complex but communal areas are jointly owned.
What is a body corporate?
A group that controls, administers and manages a sectional title complex. Every owner in the sectional title complex is a member of the group.
What is rent?
The amount paid each month by the tenant to the landlord to stay in the accommodation.
What is a levy?
A fee paid monthly to the body corporate for the maintenance of the building and common areas and security.
What is a deposit?
The amount of money that must be paid towards the purchasing or renting of a property before moving in (usually equal to 1 months’ rent or 10% of the purchase amount.
What is a bond/mortgage/home loan?
It’s the money the buyer borrows from a bank to buy property. This is paid back in monthly instalments, with interest over a fixed period.
What is interest?
The cost that must be paid to the bank for borrowing the money.
What is an offer to purchase agreement?
A written offer from the buyer to the seller that contains the purchase price and all the terms and conditions for purchasing the property.
What happens when the seller and the buyer sign the offer to purchase agreement?
It becomes the sales agreement or deed of sale once signed by the buyer and the seller.
What is bond or life insurance?
Insurance that will cover the outstanding amount of the home loan should something unexpected happen to the buyer.
What is comprehensive homeowner’s insurance?
Short term insurance that protects the house against structural damage from fire, floods and other natural disasters or political unrest.
What is household insurance?
Insurance that covers the content in the house, e.g. furniture, TV and other appliances against theft and damage.
Discuss monthly repayments of bond/mortgage.
The owner of the house must pay back the bank on a monthly basis for about 20-30 years. Repayments should not exceed 25-30% of the homeowner’s income.
Why is a fixed interest rate a benefit for a bond/mortgage?
An interest rate that is fixed does not change over the agreed upon period of time. Therefore repayments remain constant.
Why is a flexible/variable interest rate risky for a bond/mortgage?
When the interest rate changes based on the repo rate your repayments can go up significantly and you might not be able to afford your home anymore.
What is collateral security?
Something of equal value to the loan pledged as security for the repayment of a loan.
What are the advantages of renting?
Pays a fixed amount over a specific period, don’t pay land or property taxes; not responsible for property maintenance; easy to give notice and move; fewer monthly expenses.
What are the disadvantages of renting?
You will never own the property; your assets don’t increase; can be difficult to find a suitable rental; rent increases yearly and you can’t use the property to secure a loan; you can’t make changes to the property.
What is the tenant responsible for when renting?
Monthly rent payments and paying a deposit, inspecting the property before signing the lease, making a list of defects before moving in, household insurance, rates and taxes.
What is the landlord responsible for when renting out a property?
Inspecting the property before the tenant moves in, maintaining the property, homeowners insurance, property taxes.
