Some property investors are extremely conservative and are looking for a very safe no risk buy! They are looking for good growth and good rental return over a long period of time.
Other investors are looking for quick returns, buy cheap, renovate and sell.
I have favoured over time investing in properties that give a little of both.
In our area of Blouberg our beachfront properties give a lower rental return but have given better than average growth return.
In our slightly less expensive areas you can pick up a unit that has a very good rental return but might not grow as much as the beachfront area.
You can see the dilemma.
I would advise my clients that if they have got the cash to buy more expensive apartments on the beach.
You might not get good rental, but who cares if they are no hassle to rent out and are doubling up in price every few years.
If my client is bonding the property with a bank and my client does not have great cash flow then I would recommend buying a property with a high rental return and demand for rental as this can put 60 to 70 % of the finance towards the bond.
The smart way to buy is to really shop around and to try buy below market value.
If you renovate and sell for a quick buck then make sure you have other properties you can flip.
Remember once you have sold that property you will not be able to buy that same property at that price again.
So to conclude!
Buy properties below market value and hold onto them as long as possible.
Rental return and growth will almost always equal each other out.
Don’t buy brand new properties to rent out as often the damage that tenants can do will destroy that good feel a new place has.
Try to buy a property that is in good nick but can do with a coat of paint at a later stage.
If you decide to sell then you should do your renovation work to make the unit achieve a higher price.
Check out this report at Do not pay too much for your property.
You might find our Buyer's Toolkit very interesting before you go ahead and purchase that property.
The Husband and Wife Team have won the coveted platinum award three years in a row. 2005, 2006, 2007.Membership of the RE/MAX platinum club is one of the highest single year commission honours that Re/max bestows upon a sales associate.Ashley and Izelle are well known estate agents that service the blaauwberg area.There area includes, Milnerton, Melkbos, Sunset Beach, Big Bay, Parklands, Bloubergstrand and Table View.
