Making your first property acquisition successful

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The greatest moments of your life can often be marred by doubts and apprehension in the face of the unknown. Moreso, when you are deciding to purchase your first-ever house, which is probably your most important investment so far.

To avoid any unpleasant hurdles cropping up your way, you need to garner all necessary information with regards to the location, financing modes, choice of agency, legal framework, etc.

Where and how?

First and foremost, you need to decide whether you want to settle down in an urban or rural setup, keeping in mind that the resale value of your property depends largely on its geographical location.

Once this decision is made you may want to manage your debt ceiling if you require advances from a financial institution. In Mauritius, you can choose between commercial banks, insurance companies and the Mauritius Housing Company (MHC). The institution offering home loans with better competitive rates and flexible repayment conditions would be your obvious choice.

It is important to know that your loan amount must be within your repayment capacity. As per the prescribed guidelines of the Bank of Mauritius your household debt ratio must not exceed 50% of your income.

Fiscal incentives

This condition applies to all your outstanding loans, not just the housing loan you are seeking. The financing institution will diligently assess your financial situation to determine the maximum loan amount your will be entitled to.

With a view to encourage potential first-time property buyers, the government has introduced fiscal incentives through the Home Ownership Scheme. Under this scheme, which is valid until 30 June 2024, an eligible person who buys a house, apartment or plot of land on which to build his or her own home, will be reimbursed 5% of the cost of the property, up to a maximum of Rs 500,000.

In addition, no registration fees or charges will be payable in respect of any document signed or executed by the Financial Intelligence Unit (FIU).

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