Property choices in SA

[cyb3rt]

Hi guys,

I have gone through the first couple of pages and read through some of the posts and it seems there are some awesome and helpful people online here at MyBB regarding these kind of things.

I don't want to go into major detail of how I got to this point, but I have quite a significant amount of money available that I don't want to let go to waste or screw up with. I want to do something with it that will help me build for future gains on the current amount, but I am also desperately looking for a place to stay. I am not sure if buying a house cash, taking out a bond on a house, or getting a piece of land and building my own dream house is the better route to go?

I know building a house is not the cheapest or easiest way, but it has always been something I wanted to do, and if I have the funding making it a possibility then why not, I just want to get some feedback from people that know more than me about these kind of things than I do. Thanks in advance!

 

[ToxicBunny]

If you are looking for any short term type of ROI, then property is not really your option...

 

[proxilin]

I'm no expert, but my only advice is: Don't put all your money into one property. You are then tied to that place and that location, if the neighbourhood goes south so does your property value. Or if you need the money in future you are dependent on trying to find someone who wants to and has the means to buy it. That can take months or years, and you may end up settling for an amount lower than what you want.

As for what to do? Depends on how much money you have, but always: DIVERSIFY. Don't put all your eggs in one basket. Learn the power of earning compound interest. And if you really do have a considerable amount of money, go speak to a financial advisor or 3, see who you like and get advice from them. But read up a bit first so you get the basic principles.

Go over to Moneyweb and start reading some articles and blogs, e.g. http://www.moneyweb.co.za/moneyweb-money-matters/what-do-you-need-to-know-to-start-investing

Great book applicable to SA, and very easy to read and simple to understand http://www.randomreads.co.za/blogs/become-your-own-financial-advisor/233

 

[borga]

Also according to this artical it is 20% cheaper to buy than to build, it might have changed in the time since the artical (Feb 2013) but I think the principle would be the same buying is cheaper than building.
http://www.property24.com/articles/buying-vs-building-a-new-home/17185

 

[cyb3rt]

hmmm thank you very much for the replies, all is very helpful!

Thanks again! So many things to consider and to take into calculations, I think my best bet would be a financial advisor as you said prox... I will definitely do that!

 

[ToxicBunny]

Also according to this artical it is 20% cheaper to buy than to build, it might have changed in the time since the artical (Feb 2013) but I think the principle would be the same buying is cheaper than building.
http://www.property24.com/articles/buying-vs-building-a-new-home/17185

Its pretty much always been cheaper to buy than to build... the percentage difference changes a bit over time, but if anything I would say that 20% figure is optimistic, I would say its probably closer to 40% cheaper to buy currently.

 

[TheSlinger]

Its pretty much always been cheaper to buy than to build... the percentage difference changes a bit over time, but if anything I would say that 20% figure is optimistic, I would say its probably closer to 40% cheaper to buy currently.

+1

As general property price varies, that percentage would change. But what you say is true.

In my opinion if one was to build, it might make more sense to build a holiday house at a beach-town or the like. I'm not sure how much of an investment this would be though, might depend on where you were...

Just my 2c.