3 ways to store up value in your home

How to determine the true market value of your home

When you choose to purchase, you consider ways to store up value in the home. "Because property is an appreciating asset, owning your home is also a form of wealth creation. Those who are smart about how they go about it could generate greater returns for themselves in the long term,"

7 Upgrades that will improve your home's kerb appeal dramatically

Pay extra on your home loan

The first reason that this is a good idea is because it will save you on interest charges - the faster you can pay off the debt, the less interest will be payable. Even just paying an extra hundred Rand every month could take months off the loan term and could end up saving you tens (or even hundreds) of thousands of Rands.

Secondly, those with an access bond facility could view their home loan as a type of savings account. Once you have accumulated enough in the access bond, you could access that money again as a cheaper way to finance a new car (for example). A home loan tends to offer a significantly lower interest rate than a personal loan or vehicle finance. Financing big purchases through the home loan could work out to be more affordable as long as you pay it back within a few years and not over the full 20-year course of the home loan.

Renovate or build-on

Another way to store value in the home is to tackle projects that will increase the home's resale value. The key here is to avoid over capitalising on the renovation. Work out roughly what it will cost to complete the project and then speak to a real estate professional to find out how much value the renovation could add to the home.

Sit tight

Real estate is a long-term investment strategy. Even if you do nothing to the home, it will be worth significantly more in ten year's time from now. If you move every three to five years, you might be able to break even or walk away with a small profit after taking into consideration all the closing costs but, unless it was a property flip where major renovations were completed, homeowners do not stand to make too much money on the home when it is sold too soon.