Sell or rent out apartment

[Johnatan56]

Lets put this in perspective. I too purchased a flat in 2000. For R205 000. It's now worth about R1.2m. I get more than R8000pm rental on it now. I will be honest, rentals got hit in the last year or two.

But - it's consistent income. That normally grows over and above inflation. And that excludes the capital growth.

I doubt the grow above inflation in the next few years, most of e.g. Cape Town property prices were too bullish. You won't see rental prices decrease much or property prices either, it's more that they will not grow to match inflation until they reach a better equilibrium.

I'm not sure who will be renting a lot of the apartments in e.g. Sea point, was already high vacancy there with most AirBnB, property prices are way overvalued compared to rent cost, your bachelor pads are students and people in their 20s, they're not high in their career path, and lots of them will now be leaving South Africa if they can, those that can afford sea point are generally from well off families or will work from home in a house that's way cheaper with more space somewhere else.

Know a few who have already done it, last two people I know who own apartments in sea point and live in them are on the path to emigration, and I used to know quite a few there.

In regards to tenant credit history to make an informed decision, lots lost their jobs during the pandemic, it will reflect on their credit report, they had no option, it will be very interesting how you'll manage to vet them all.

 

[GrootVoet]

You keep on changing numbers, in a very strange way.

You are obviously talking the biggest load of BS

Sorry I made it too complex for you to follow, point out what's unclear and I'll make it simpler for you to understand. If I made a mistake I'll gladly correct it.

 

[GrootVoet]

you're relying on compound interest off a relatively low capital amount. In 20 years time your 250k is worth around 650k which is barely keeping up with inflation.

Everyone's financial position is different so many different views on this. My biggest problem with property as investment is liquidity, if you need money in a hurry it takes time to sell. Tenants are also a big concern, a bad tenant can ruine you easily.

 

[Splinter]

And this makes you an expert You clearly have been lucky this far. There are thousands of people on the Facebook group, LegalTalk who would set you straight. There are many who lost their premises due to non paying tenants and banks ending up repossessing the properties.

What Will It Costs To Evict A Tenant - Eviction Lawyers South Africa | Le Roux Attorneys Inc.

Proprety24 talks to us at Le Roux Attorneys about the process of eviction and what it costs a landlord to legally evict a tenant should the situation arrise

www.evictionlawyers.co.za

To any real person out there renting out a premises, this is the funds you will need to have access to when you get a tenant who refuse to leave.

Ag man, you quoting worst case scenarios. I have a friend who is an attorney and deals with these kind of things constantly. Last time I asked her she said it was about R20000 on average. Most people who cannot pay their rent cannot afford lawyers.

Anyway, you miss my point about vetting your tenants, and dropping an off the record comment about certain, perhaps not so legal, resources you have access to

 

[Splinter]

Sorry I made it too complex for you to follow, point out what's unclear and I'll make it simpler for you to understand. If I made a mistake I'll gladly correct it.

I'm sorry, if you can't see the simple errors in your calculations then there is nothing I can do

 

[Splinter]

In regards to tenant credit history to make an informed decision, lots lost their jobs during the pandemic, it will reflect on their credit report, they had no option, it will be very interesting how you'll manage to vet them all.

It's not just credit history checks hey. You meet the people and get a "feel" for them. Funnily enough, my current tenant and my moms were more risky based on credit background than normal, but we had a good feeling about them. They have turned out to be rock solid, even when badly affected by COVID. My mom reduced rent in the time period when her tenants income was drastically affected, but the tenant made every effort to pay what she could.

 

[Johnatan56]

It's not just credit history checks hey. You meet the people and get a "feel" for them. Funnily enough, my current tenant and my moms were more risky based on credit background than normal, but we had a good feeling about them. They have turned out to be rock solid, even when badly affected by COVID. My mom reduced rent in the time period when her tenants income was drastically affected, but the tenant made every effort to pay what she could.

Not disagreeing, you meeting your tenant and talking with them a bit should be a requirement, the problem is that many are pretty good at conning and not everyone has a good eye to catch such issues.

 

[Splinter]

Not disagreeing, you meeting your tenant and talking with them a bit should be a requirement, the problem is that many are pretty good at conning and not everyone has a good eye to catch such issues.

This is true. Some people are unfortunately good at con jobs.

 

[Dolby]

Like many have said, in theory renting is perfect - but the practical is very different.

Getting the right tenant is becoming more and more difficult as the economy dips and less people have money. With Covid, this is even worse. I had my story on here but to summarize :

• Tenant was vetted by a credible agent - close on R10,000.00 cost to us
• The report somehow missed judgements - the agent shrugs it off and doesn't bother helping
• No rent came from April 2020 to January 2021- R90,000 in lost revenue during this time
• Though, she had cash for holidays and drinks / socializing
• We tried to get her out and we violated her rights - she took us to court twice for that, but didn't pitch either time
• We eventually went the legal route - R60,000.00 and 6 months

She still got her attorney to write a letter to state that we don't need the property as it's 'only' an investment for us and she wants it (rent free) for another few months as she hasn't been able to secure something.

Tenant got the EFF Youth League to call us and threaten us too.

She lied about receiving no income at work during Covid - but she was getting full pay anyhow

 

[GrootVoet]

I'm sorry, if you can't see the simple errors in your calculations then there is nothing I can do

And if you can't point them out, then ja, thats that.

 

[TStringList]

Like many have said, in theory renting is perfect - but the practical is very different.

Getting the right tenant is becoming more and more difficult as the economy dips and less people have money. With Covid, this is even worse. I had my story on here but to summarize :

• Tenant was vetted by a credible agent - close on R10,000.00 cost to us
• The report somehow missed judgements - the agent shrugs it off and doesn't bother helping
• No rent came from April 2020 to January 2021- R90,000 in lost revenue during this time
• Though, she had cash for holidays and drinks / socializing
• We tried to get her out and we violated her rights - she took us to court twice for that, but didn't pitch either time
• We eventually went the legal route - R60,000.00 and 6 months

She still got her attorney to write a letter to state that we don't need the property as it's 'only' an investment for us and she wants it (rent free) for another few months as she hasn't been able to secure something.

Tenant got the EFF Youth League to call us and threaten us too.

She lied about receiving no income at work during Covid - but she was getting full pay anyhow

What the flying saucer?

It's stories like this that make one hesitant to rent out their home. Of course, it's not everyone but that's a lot of money you've lost there. It feels like a scam because some of them know they can get away with it.

 

[Splinter]

And if you can't point them out, then ja, thats that.

I've already pointed out one, for crying in a bucket! And then you can take that one and tell us how you then got to R250k profit in the next post of yours I quoted.

 

[Dolby]

I have a friend who is an attorney and deals with these kind of things constantly. Last time I asked her she said it was about R20000 on average

She's probably giving you one part in the chain. As mentioned we were R60,000 down a few months ago. There were like a page of costs that added up - every letter sent, every court attendance, every time there's a new twist

 

[Splinter]

She's probably giving you one part in the chain. As mentioned we were R60,000 down a few months ago. There were like a page of costs that added up - every letter sent, every court attendance, every time there's a new twist

I doubt it. You had a contested case though.

 

[Priapus]

She's probably giving you one part in the chain. As mentioned we were R60,000 down a few months ago. There were like a page of costs that added up - every letter sent, every court attendance, every time there's a new twist

Have you managed to resolve the situation and what are you plans now with the property?
Sorry to hear about your experience.

 

[Dolby]

I doubt it.

I think you best paste her details here - she's obviously the cheapest in the country and will super busy if she can get full on evictions on under R20,000.

Have you managed to resolve the situation and what are you plans now with the property?
Sorry to hear about your experience.

She left 11 January and we put the house on the market , It 2 months to sell - but then the process was delayed (Covid) and we only got the money for the house a few weeks ago.

The end of a 14 month long nightmare

 

[Priapus]

She left 11 January and we put the house on the market , It 2 months to sell - but then the process was delayed (Covid) and we only got the money for the house a few weeks ago.

The end of a 14 month long nightmare

Are you out of the property market now due to this experience?

 

[Splinter]

I think you best paste her details here - she's obviously the cheapest in the country and will super busy if she can get full on evictions on under R20,000.



She left 11 January and we put the house on the market , It 2 months to sell - but then the process was delayed (Covid) and we only got the money for the house a few weeks ago.

The end of a 14 month long nightmare

Your one experience makes you the expert?

 

[Dolby]

Your one experience makes you the expert?

I asked a number of lawyers the costs involved.

But they're all wrong?
I'm wrong?
The previous poster was wrong ?

I just think that your friend should advertise as everyone else has the wrong figures

 

[Dolby]

Are you out of the property market now due to this experience?

Yup.

And it's not the first time.

When my father passed away, I was left a house that no one really wanted to live in - but due to strange clause in the Will, couldn't be sold either. There weren't many options, so we were forced to rent out over the years. Each tenant had their own set of issues that drove me insane. Suffice to say, flogged the house as soon as I could and not interested in any property other than a primary residence