Investment options

HavocXphere said:
Archaic, outdated, unsophisticated. Flawed, flawed, flawed.

:p
Click to expand...

Each to his own brother . No hard feelings. NAV check > USD10m. You?

You are much more cleverER than me. You win.
 
Last edited:
supersunbird said:
I bought a buy-to-let property for R490 000 (needed some work) in August 2008. I now owe R400 000 on it, 7 years down the line. The 2 sales in 2014 (thanks property24) in the complex fetched between R800 000 to R850 000. Altogether I have put in just under R100 000 of my own money in over the 7 years and now almost nothing beyond the occasional repairs that I can claim back later. So if I sell it next year and get R400 000 or more out (after whatever taxes and costs) then I'll have grown my investment of R100 000 by 300%.

Now the only Unit Trust that would have given me more than 300% over the past 7 years would have been the Coronation Industrial Fund at 315.39% (/nod to that Marco forum member who loved it) and I would have had to have had R100 000 to start with. The second best fund is the Stanlib Property Income Fund and that would have given me 254.56% over the past 7 years to date. Worst performing Unit Trust I have info from would have given me a -29.33% (OUCH!) over that period, looking at you Stanlib Resources Fund lol.

Now don't be mistaken, it's hard work and a hassle at times. Attending AGM meetings to make sure the complex is properly run. Extra work at e-filing time. Special levies now and then for whatever, to mess with cashflow. Tenants who pay late at times. Ideally you have to stay close to be able to keep a proper eye on it.

I have considered selling a few times, maybe put the money into my RAs and a TFSA if I do, so I keep an eye out on what sales prices are like in the area, if the area is being maintained and not starting to look like its getting run down.

Results may vary and I have been somewhat lucky.
Click to expand...

When you sell it it will be more like R300k profit over 8 years less 8 years worth of levies and taxes and other costs (R1000 pm? Guessing here). I'm assuming due to the low purchase price you didn't incur transfer duty costs the average buyer does incur.

So then its R300k - (R1000 x 96 months). So now it is closer to 200% over 8 years (or 250% if we have the costs above). Still a great return. Beats inflation by quite a bit.

Unless you included all of those extra costs in the R100k you spent in which case you must've gotten and excellent interest rate at the bank
 
RR777 said:
Each to his own brother . No hard feelings. NAV check > USD10m. You?

You are much more cleverER than me. You win.
Click to expand...
Marco clone? I remember you from another investment thread (Proof is in the Pudding?) where you called people stupid (or something like that) for only investing R500 pm. At least I think it was you because that guy also bragged about his massive portfolio value at one stage.
 
Hamster said:
Unless you included all of those extra costs in the R100k you spent in which case you must've gotten and excellent interest rate at the bank
Click to expand...

I am including all those costs in the R100 000, the rental is just just covering all monthly costs for about 2 years now and the interest rate is 7.9% currently. And yes, was just just below the transfer duty costs starting range. It's a popular area for people to stay and also high rental demand.

But I did worse than the Coronation Industrial Fund :( so it's a super bad investment boo hoo :rolleyes:. Somehow that other rich guy got the bank to give him R490 000, or more, to invest in listed and private equity and he then easily bought Naspers, Capitec and EOH shares and others, perhaps overseas also, because he knows the good horses when he sees them, and he invested in own businesses which has no risk, always succeeds and required little effort or stress...

Would I do it again? Yes, but still, it has its own risks and stresses. One should look carefully and takes ones time and not just buy the first unit you see. Buy somewhere you'd be willing to stay yourself, at as low a price and interest rate as possible.

EDIT: If I had R1 mil like the OP, would I do property with it? Nope! Easier ways to make money off that R1 mil
 
Last edited:
RR777 said:
You have successfully convinced yourself that you have done great with residential BTL. Maybe you have maybe you think you will eventually. No skin off my back. Fact remains - it is a terrible investment option.
Click to expand...

If it was that terrible people wouldn't do it. They would all sell up etc. but ten demand would outstrip supply ( or prices adjusted ) and it would be good again.

It's not the only option. And it doesn't work for all people in all areas.
I have been very successful with my units as part of diversified investment plan. In hind sight easy to say should have put it into equity or listed property or gold or fund xyz.

Truth is you never know what will be the best investment vehicle for the next few years.
 
I read on moneyweb the other day that property overall is a pretty crap investment, except if it is located in areas like Cape Town and Sandton (incl. surrounding areas) where it is actually growing pretty well.

Not sure how accurate that is, anybody here that bought property in Prieska want to tell us their experience?
 
RR777 said:
Know what is a sure sign of someone that has no clue about investing? Anyone who still promotes/believes in buy-to-let residential property as an "investment". Archaic, outdated, unsophisticated. And the prophets who promote this always have the spreadsheet number crunching details ready, as well as the gearing argument. Flawed, flawed, flawed.
Click to expand...

Like you said, to each his own.

People like Trump must be pretty stupid then. Wasn't it his Business interests that got him bankrupt and property once again made him a Billionaire?
 
Pitbull said:
Like you said, to each his own.

People like Trump must be pretty stupid then. Wasn't it his Business interests that got him bankrupt and property once again made him a Billionaire?
Click to expand...
That's a silly comment because Warren Buffet and Bill Gates
 
czc said:
Where am I going wrong?
Click to expand...

Levies are high, you should raise the rent by R1500 at least I reckon. Maintenance is also tricky, most years you won't do any (and just build up a reserve instead). But if 6k is the market rate for that property, then it is simply a bad investment. You should also factor in the capital growth for ROI if you plan to sell it.

Don't you wanna share that speadsheet with me? All the calcs I've found on the net are tailored to the US and I'm sure there is some background stuff in there that gives me the wrong ROI
 
Hamster said:
That's a silly comment because Warren Buffet and Bill Gates
Click to expand...

But it does prove there is no singular correct answer as many people seem to think. I think it is a case of "this is what I'm doing for my retirement, and I'm farking scared of not having enough money when I do retire, so I defend my choices like it's life or death and everyone else is wrong"

Do your research, look for where you can get the most value and go with it.
 
Hamster said:
That's a silly comment because Warren Buffet and Bill Gates
Click to expand...

I'm not comparing them. I'm saying that if property is such a bad investment, why are there so many very successful property investors?

I have never downplayed shares as an investment ;)
 
Pitbull said:
I'm not comparing them. I'm saying that if property is such a bad investment, why are there so many very successful property investors?

I have never downplayed shares as an investment ;)
Click to expand...

property in general is a bad investment, investment property on the other hand is a totally different concept

successful property investors don't just buy any property and then consider it an investment
 
Pitbull said:
I'm not comparing them. I'm saying that if property is such a bad investment, why are there so many very successful property investors?

I have never downplayed shares as an investment ;)
Click to expand...

Read the post. I specifically said residential buy-to-let. Trump certainly did not make his money with a few BTL townhouses. In fact, his BUSINESS is property. Big difference between that and passive "investment" in residential BTL.
 
Last edited:
Pitbull said:
I'm not comparing them. I'm saying that if property is such a bad investment, why are there so many very successful property investors?

I have never downplayed shares as an investment ;)
Click to expand...

This is like Sony vs Microsoft, Apple vs Android. Everyone will defend their choice since it's the only one that they have and it has to work out for them.

Good luck with your property.
 
RR777 said:
Read the post. I specifically said residential buy-to-let. Trump certainly did not make his money with a few BTL townhouses. In fact, his BUSINESS is property. Big difference between that and passive "investment" in residential BTL.
Click to expand...

Yes, millions of dollars fell into hi slap and he started to build massive casinos and the likes /facepalm.

Please read his book. He started off working for his dad who started with middle class rental properties.

Anyway, not getting into this debate with you as I think Archer has it spot on. Do with your Millions of dollars what you like. I'll do with my meagre funds what I like. OP asked a question and I gave him advice. More than what you did.
 
whatwhat said:
This is like Sony vs Microsoft, Apple vs Android. Everyone will defend their choice since it's the only one that they have and it has to work out for them.

Good luck with your property.
Click to expand...

Agreed Archer also said it earlier. If something works for you stick with it. If it doesn't move on to something else.
 
You must log in or register to reply here.
Back
Top
Sign up to the MyBroadband newsletter
X