The big question: what sort of property to buy?

The uncertain economic climate has prospective homebuyers and investors queuing for advice about the best investment opportunities.

"The biggest question on buyers and investors' minds today is what sort of property they should buy," says Martin Schultheiss, CEO of the Harcourts Africa property group.

"They weigh the benefits of older properties against those of units in new developments, urban against suburban units, and rural homes against units in golf estates. But the simple answer is that the situation changes all the time.

"For instance, in the current market there is no doubt that the biggest growth in value is at the bottom end of the market due to the number of people migrating to a better lifestyle. But less than five years ago, golf estates yielded returns of 30% or more and investment in leisure was one of the best choices you could make.

"However, there is a golden rule in property investments that serious investors and keen homebuyers should heed, namely, property returns are not about when or what you buy or sell, but how long you are prepared to stay in the market."

Schultheiss adds that local investors had become accustomed to making returns of up to 30% in the relatively short space of 18 months. "Now that this figure has dropped significantly there has been much talk about property being a 'bad' investment.

"However, we firmly believe that property remains a sound investment that will yield good returns for those investors who are prepared to stay in the market over the medium to longer term, with the time that you remain in the market determining the returns you finally make," he says.

"For instance, if you ask an elderly couple still living in their first home, they will probably tell you that they bought the property for R25 000 - which was a huge sum in those days - but that the current value is close to R1m, in today's money."


  Comment on this Article

  Please login to post comments

Post to my facebook wall
Characters remaining

    Latest Property News
    • 21 Jun 2018
      Anyone who’s ever been involved in a building project that’s gone wrong will appreciate the importance of adequate insurance cover in the construction industry.
    • 21 Jun 2018
      A recent news story about a blind tenant caught in a legal battle with his body corporate over letters and notices he was unable to read and consequently comply with has raised the question: what are the legal obligations for landlords with disabled tenants?
    • 21 Jun 2018
      A trend that’s taken the world by storm in recent years is that of hygge (pronounced: hue-guh), a Danish concept that is about creating intimacy, connecting with loved ones and taking pleasure in small, ordinary things.
    • 20 Jun 2018
      Buying or selling real estate isn’t as easy as it is portrayed sometimes, especially if there is a death of a party during the transaction which can make it awkward, tricky and inconvenient.
    • 20 Jun 2018
      With interest rates remaining at historic lows and banks continuing to compete for mortgage finance business, first-time buyers with funds at their disposal are currently well-placed to gain that initial foothold on the property ladder, particularly in the light of the slightly lower growth rates currently experienced in residential property values.
    • 20 Jun 2018
      The average size of bond granted in SA has grown 7,7% in the past 12 months to R934 000, according to BetterBond, the country’s biggest bond originator.
    • 19 Jun 2018
      In the current market, letting out a property can be a good option as rental demand remains strong, especially in the northern suburbs of Johannesburg. This is according to Chris Renecle, MD of Renprop. However he says that before homeowners let their property out, there are five key points they should make sure are covered before they market the property for rent and sign any lease agreements.
    • 19 Jun 2018
      The Capetonian dream is to live by the ocean with the iconic mountain making an appearance somewhere in the horizon. But, that dream comes with a hefty price tag that many simply cannot afford. But, should you venture some kilometres out of the city centre, entirely new realms of beachside bliss await you …
    Subscribe to the MyProperty Newsletter

    Last Name  
    Email Address  
    Email Frequency
    Share this Page

    For Sale Property
    Rental Property
    More Options
    Connect with us