Buying a flat to let

surface said:
Don't forget your mybb roots once you become property baron like him, ok.
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Its actually so funny how easy it is just to listen (and its free advice that works) ! From how to manage, to how SARS can help you if in trouble ! (Its just to take that first step) ! Mr Ogre is in contact, let me train another soon to be landlord ! (will keep you posted)
 
The_Ogre said:
I'm defintely not in the top tax bracket!

If I get prime, I'd be looking at around R13k bond repayments. The unit that I'm currently renting is R8 250, so that's quite a loss that I'll be running for a few years.

Not sure I mentioned it, but I'm planning to buy in the same complex I'm currently renting in.
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Makes absolutely no sense (at least to me) why you would buy a place to rent out, if you are also renting.

The R13k bond repayment is not where it ends. Costs to consider above and beyond your repayments:
- Estate agent commission if you not going to manage the lease yourself
- Municipal Rates and taxes
- Management levies (some body corporates are stupid with levies, my current bill is around R800 on a flat)
- Property insurance (if not included in the levy)
- Any ad hoc repairs and maintenance is for your account. Tenants complain about the most basic crap.

The above can easily add to 20-25% of the Rental bill, so R2k if you renting for R8 250.
 
Mike Hoxbig said:
Make sure you'd be able to cover the bond if the unit lies empty for a few months.

I would downscale to a 1|2 bedroom to create that buffer...
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We rented out juuuust as COVID hit. I think we’re got one or two months - and the minute she could blame COVID, she did. We got effectively nothing for 10+ months (though, still has a bond and her water / power to pay)

And then R60,000 to go through legal means to get rid of her (eviction orders / lawyer letters etc).

We’re still feeling the affects now
 
Dolby said:
We rented out juuuust as COVID hit. I think we’re got one or two months - and the minute she could blame COVID, she did. We got effectively nothing for 10+ months (though, still has a bond and her water / power to pay)

And then R60,000 to go through legal means to get rid of her (eviction orders / lawyer letters etc).

We’re still feeling the affects now
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Dolby what you are saying is reality. I personally think the odds are very slim, but it could and can happen.

I am doing the landlord thing since 2010. In 12 years, had 2 issues. And in total 4 months of drama in total. Anything could happen. There are always risks involved! Its never 0%
 
Dolby said:
We rented out juuuust as COVID hit. I think we’re got one or two months - and the minute she could blame COVID, she did. We got effectively nothing for 10+ months (though, still has a bond and her water / power to pay)

And then R60,000 to go through legal means to get rid of her (eviction orders / lawyer letters etc).

We’re still feeling the affects now
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You are not the only one. Many people lost their investment properties in the past decade or so. Not because of Covid, but bad tenants - worth mentioning it that the Covid scam inflated the problem by untold amounts. South Africa's laws extremely against owners and making money from property rentals or sales. The country is not conducive for such income stream any longer. Just hang around various legal groups on FB and you will see the problems home owners are facing.
 
zerocool2009 said:
Dolby what you are saying is reality. I personally think the odds are very slim, but it could and can happen.
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rvZA said:
South Africa's laws extremely against owners
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We learnt the hard way :(

I had rented out a property (separate to this) from about 2005 to 2010 and it was OK - but still, every tenant in that 5 years had some issue. I didn't lose money at the end of the day - but they were a huge headache with the continual phoning and really dumb requests. But as I said it was OK - though did scare me away renting in future.

This later property was the GF and she had some attachment and chose to rent. I've got a whole thread about the process somewhere here (as it lasted so long) - but a nightmare was an understatement. As you say about the laws, anything you (owner) does that mildly impacts her (tenant) lands you in court .

We disabled her fingerprint access - and 2 days later we had the police at our door with a court date (!) We went on the date - she didn't
We did something else in the time that violated her rights - and again, hauled to court and she didn't even bother to arrive

It was a great feeling when the neighbours all sent us photos of a moving truck outside the apartment (already 4 days past the date of the eviction notice )
 
Dolby said:
We learnt the hard way :(

I had rented out a property (separate to this) from about 2005 to 2010 and it was OK - but still, every tenant in that 5 years had some issue. I didn't lose money at the end of the day - but they were a huge headache with the continual phoning and really dumb requests. But as I said it was OK - though did scare me away renting in future.

This later property was the GF and she had some attachment and chose to rent. I've got a whole thread about the process somewhere here (as it lasted so long) - but a nightmare was an understatement. As you say about the laws, anything you (owner) does that mildly impacts her (tenant) lands you in court .

We disabled her fingerprint access - and 2 days later we had the police at our door with a court date (!) We went on the date - she didn't
We did something else in the time that violated her rights - and again, hauled to court and she didn't even bother to arrive

It was a great feeling when the neighbours all sent us photos of a moving truck outside the apartment (already 4 days past the date of the eviction notice )
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Yeah, I can imagine that feeling when people like that just leaves. But, I also do know for a fact that there are people on social media who admits that they are looking for places to rent, as they can move in, stop paying and won't be evicted within a year or longer and live free in that time.

Unfortunately, a tenant will always run into problems. Everyone does. As a home owner, it will always become your problem.

But, it becomes a liability when you need to have at least R100k put aside for legal costs, at least 1-2 years of rent put aside, at least 1-2 years of water and electricity bills put aside, just in the event a tenant no longer pays rent and refuse to move out. This is when renting out becomes a risk.
 
And sorry to hijack this thread - but what really pissed me off is they (tenant) have no care in the world for what you have to go through.

At the time all of this was happening, we fell pregnant and at a time that should be a joyous occasion, we have to pay for two houses and the huge stress of my GF going to court and losing money left / right / centre . Like I said, we're still battling today because of this process 2 years back and although we had enough savings, we didn't expect Covid to wipe everything out and no additional rental income for a year, while paying 2 bonds .

And really, really bugged me checking her Whatsapp status and seeing how she was on vacation every few weeks and enjoying life, while we relied on people gifting us cots and clothes

/vent over
 
rvZA said:
But, it becomes a liability when you need to have at least R100k put aside for legal costs, at least 1-2 years of rent put aside, at least 1-2 years of water and electricity bills put aside, just in the event a tenant no longer pays rent and refuse to move out.
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Yea - I'll never rent again, and I think the gf also learnt
 
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