Investing in Property

[foschinni]

Happy 2014

I need advice/way forward as to how to invest in property. Basically, I’ll be teaming up with a friend to buy the property cash. We have a budget of around R300K as a start, which can only buy us a one bed house or so.

Intention: To buy run down or repossessed property with the aim to fix and sell.

Questions and points;
- Where can we buy a market intelligence report that shows sales activity, average time for successful sales in a given area etc
- Is it better to buy cash or use the bank for a bond?
- What risks must we be aware of
- Where do we get intelligence to good value deals, given that we are not the only ones looking for such
- Are there recommended property workshops we can attend?
- Are there recommended books we can read?
- If we buy occupied property and reach an event where we have to evict the tenant, can we budget on a worse case scenario of say R20K in legal costs and say 6 months for the whole eviction to take place?
- If you are or you know of a property investment Guru I am willing to pay for a consultation session. Kindly advice

Thanks

 

[Other Pineapple Smurf]

Where do you plan to buy? R300K in Somerset West is no the same as R300K in the township.

Also for how long do you want to hold onto the property? If its long term you need to find out about local upgrades. An example is my house which is next door to a train station. For other buyers they were put off to the location as they assumed the property prices would continue to spiral, for me I knew better as they were upgrading the local station, increasing security as part of the local public transport upgrades. In 9 months time my house has increased in value by 40% and I've done jack to the house due to the location of the property.

 

[foschinni]

Where do you plan to buy? R300K in Somerset West is no the same as R300K in the township.

Also for how long do you want to hold onto the property? If its long term you need to find out about local upgrades. An example is my house which is next door to a train station. For other buyers they were put off to the location as they assumed the property prices would continue to spiral, for me I knew better as they were upgrading the local station, increasing security as part of the local public transport upgrades. In 9 months time my house has increased in value by 40% and I've done jack to the house due to the location of the property.

I'm planning to buy within the Johannesburg area - Randburg/Midrand. I do not plan to hold on to the property. I want to buy a place that's going for say 80% of what it's worth, apply some touch-ups to the place and immediately sell it. From there I'll jump to my next one!

 

[Badprop_za]

The current property market might be against you if you are looking for quick flips!!

You might need to hold onto the property for a couple of years if you want to make money. But then again, there is never a bad time for good deals.

 

[Ekstasis]

Contact Treoc for their next seminar.

 

[foschinni]

The current property market might be against you if you are looking for quick flips!!

You might need to hold onto the property for a couple of years if you want to make money. But then again, there is never a bad time for good deals.

Thanks - could you elaborate further regarding the current market. There are still properties being repossessed etc? tx

 

[foschinni]

Contact Treoc for their next seminar.

Thanks will do. Just a note though, I think in one of the threads it was mentioned that Treoc is dodgy...
Can someone who is a Treoc member provide opinion as well.
Tx once again

 

[Sgt. Troy]

Is Wits property management certificate any good? Would it be worth while to study before joining the property game?

 

[foschinni]

Is Wits property management certificate any good? Would it be worth while to study before joining the property game?

I didn't know about it. Let me check it. Thanks

 

[Badprop_za]

Thanks - could you elaborate further regarding the current market. There are still properties being repossessed etc? tx

In the last 4 or so years, house prices has been pretty much the same in real terms (House prices increased in-line with inflation). Now the problem is that people selling their properties are expecting more that they are actually worth. (I.e. wanting to sell a property for R1,6m while it is only realistically worth R1m)
Then their is the financing portion. With consumers becoming more indebted, banks are also not willing to grant mortgage loans gung ho.
Just the 2 factors above can cause properties to be for sale for months.

 

[Ekstasis]

Thanks will do. Just a note though, I think in one of the threads it was mentioned that Treoc is dodgy...
Can someone who is a Treoc member provide opinion as well.
Tx once again

No afaik they're not dodgy. It has to do with using the banks money to refinance property with the equity in another property. A key factor is also the way they set up different trusts for tax purposes. A very good friend of mine who was a Treoc member had 39 properties, some paid off others still had bonds.
Just do a seminar and decide for yourself. They have all the key people under one umbrella, from the trust gurus to bond originators.

 

[foschinni]

In the last 4 or so years, house prices has been pretty much the same in real terms (House prices increased in-line with inflation). Now the problem is that people selling their properties are expecting more that they are actually worth. (I.e. wanting to sell a property for R1,6m while it is only realistically worth R1m)
Then their is the financing portion. With consumers becoming more indebted, banks are also not willing to grant mortgage loans gung ho.
Just the 2 factors above can cause properties to be for sale for months.

Thanks this is good insight. Will keep an eye!

 

[foschinni]

No afaik they're not dodgy. It has to do with using the banks money to refinance property with the equity in another property. A key factor is also the way they set up different trusts for tax purposes. A very good friend of mine who was a Treoc member had 39 properties, some paid off others still had bonds.
Just do a seminar and decide for yourself. They have all the key people under one umbrella, from the trust gurus to bond originators.

Cool bananas!

 

[Ekstasis]

OP, also visit www.sasherrif.co.za for property auctions.

sasheriff.co.za is a venue for foreclosures, and attached property, consignments and other items, at the same time offering sheriffs and potential buyers an easy way to make a connection promptly and effortlessly.

R95 /month

 

[foschinni]

OP, also visit www.sasherrif.co.za for property auctions.

sasheriff.co.za is a venue for foreclosures, and attached property, consignments and other items, at the same time offering sheriffs and potential buyers an easy way to make a connection promptly and effortlessly.

R95 /month

This is good stuff Ekstasis

 

[Ekstasis]

This is good stuff Ekstasis

Sheriff auctions is one of your best options for good deals. Currently times are tough and you might find that not many buyers arrive at these auctions. Another friend of a friend went to one of these about 3 years ago. There were literally 2 potential buyers, him and someone else. He landed that day 9 town houses in a complex in Sandton for a mere R1.3 mil. That's roughly R140k per unit. Well he was very lucky I must say.

 

[foschinni]

Sheriff auctions is one of your best options for good deals. Currently times are tough and you might find that not many buyers arrive at these auctions. Another friend of a friend went to one of these about 3 years ago. There were literally 2 potential buyers, him and someone else. He landed that day 9 town houses in a complex in Sandton for a mere R1.3 mil. That's roughly R140k per unit. Well he was very lucky I must say.

I agree, things are very tough out there. Yerr your friend was lucky, he must be a millionaire now So will you connect me to your friend so he/she can give personal advice

 

[phiber]

That link goes to a page that's for parked domains. http://www.sasheriff.co.za/ is the right one.

 

[foschinni]

That link goes to a page that's for parked domains. http://www.sasheriff.co.za/ is the right one.

Thanks - I figured and quickly ran a Google search to find the right one!

 

[Pakka]

What you want to do is a different type of investment in property. It's a risky type. And its not what the guys at Treoc recommends either. With good reason.

You want to do house flipping. That's dangerous. You really need to know the market, and predict the market. Its risky business. You will also struggle with buying auctioned property that is currently inhabited.

The other type of property investment, the one that makes you rich with least effort, is of course buy-to-let property. In this case you buy properties without the intention to ever sell them. You make money by having your tenants pay your bond and then some; as well as having your property grow in value (which you can borrow against in the future).
So you buy a property with say 10% deposit, and get a tenant in to pay the other 90% and more.
That's safer and with less hassle.