Property - your biggest asset

For most people, purchasing a property will be the biggest investment decision that they will make - and it’s one that will affect their financial well being possibly for the rest of their lives, says Adrian Goslett, CEO of RE/MAX of Southern Africa.
He notes that from an investment perspective, the property that they purchase will most likely make up the largest percentage of their net wealth.  “For this reason, it is comforting for those who have invested in property to know that property ownership is a viable investment that has proven, over time, to be a major factor in the building of personal wealth. That is provided of course that the buyer adheres to the core principles of purchasing property and all investments are well researched,” says Goslett.
According to Goslett, although market conditions will play a significant role, the main element that sets a successful investor apart is knowledge. “Regardless of the investment, whether property or otherwise, it is extremely important to take the time to research all possible aspects of the endeavour before committing to anything. We know that current market conditions favour buyers, however regardless of the market conditions the buyer must still make an informed decision considering all factors that influence the property’s possible appreciation in the future. These factors would include elements such as location, type of property and the property’s features. Irrespective of the conditions surrounding the market in which the investment is made, these factors remain important and need to be factored into the decision,” advises Goslett.
He notes that buyers who are unsure of anything should consult with a financial adviser or experienced real estate professional before making any investment decision. “Due to the fact that property investment can have such a massive financial impact, it is definitely worthwhile to seek out the expertise of a professional for guidance in the right direction before putting pen to paper. Even though real estate investment can be a lot more forgiving than some of the other vehicles of wealth creation, lack of knowledge leading to a poor investment decision could mean the difference between losing thousands and being able to enjoy the fruits of solid financial profits,” says Goslett. 
He notes that generally property is less volatile than the equity and share markets and moves through fairly predictable phases. “Looking at the property cycles over the past few decades, there is a definite pattern that can be followed over a period of nine years. Every nine years there is an economic downturn which takes an average of 10 months to complete from the top of the cycle to the bottom. The bottom of the cycle usual lasts approximately 24 months, followed by a slow yet solid upturn to the top with a recovery period of about 64 months,” says Goslett. “Understanding the property cycles will assist investors in knowing when to purchase property in order to see the highest return on investment. Based on the history of the property market and it cyclical nature, investors can confidently take advantage of the slower periods knowing that their investment will see significant growth during the booms and solid appreciation over the long term.”
According to Goslett, another attractive element about property is that it is the only appreciating asset class that can be financed. Unlike other investment options, banks are willing to provide the money to a qualifying property buyer for them to purchase a property.  However, the buyer will need to show the required criteria and affordability in order to qualify for a home loan.
“Property remains a vital component of any investment portfolio, but it is always important to view it as a long term investment. An important consideration to make is the length of time you hold onto the property before selling. Adhering to the correct methods and purchasing the right investment property can be the key element to building personal wealth in the future,” Goslett concludes.

  Comment on this Article

  Please login to post comments

Post to my facebook wall
Characters remaining

    Latest Property News
    • 16 Mar 2018
      Strange as it may seem, there is a stock shortage looming now in the luxury sector of the Johannesburg property market, because astute buyers have for the past few months been hurrying to snap up high-end homes being offered at excellent prices.
    • 16 Mar 2018
      No one likes having to claim but having insurance for your household contents is vital, and at the start of a new financial year, homeowners either applying for new household insurance or revising their existing insurance should take a comprehensive inventory of their possessions and keep track of the total value.
    • 15 Mar 2018
      First-time buyers typically need to save for at least three years to afford the deposit on a home, and the VAT and fuel price increases announced in this year’s budget are going to make it even more difficult for them to reach that goal.
    • 15 Mar 2018
      Sea Point shows how developers use these organisations to advance their own interests
    • 15 Mar 2018
      As the rand strengthens against other major currencies, the prospect of investing in properties abroad is an increasingly appealing option for South African investors. Several factors, local and international, are sending a clear message: now is the time.
    • 14 Mar 2018
      Selling a property is never easy. Subtle details – from mismatched scatter cushions, to an unswept kitchen – can spell the difference between a potential buyer making an offer, or scratching your property off their list altogether. As much as you would love to be around to hear the passing comments as buyers amble through your abode, by choosing to remain at home during a showing, you set yourself at risk of becoming exactly that “subtle detail” that gets in the way of an offer.
    • 14 Mar 2018
      Home design mirrors the world around us and the phenomena of global warming, fossil fuel depletion and natural resource scarcity have created a revolution in architectural concepts and design.
    • 13 Mar 2018
      It has long been a foregone conclusion that towns where markets are driven largely by the demand for holiday homes will always perform below the national average during subdued economic times, but a report released by FNB last month has revealed that this is no longer the case.
    Subscribe to the MyProperty Newsletter

    Last Name  
    Email Address  
    Email Frequency
    Share this Page

    For Sale Property
    Rental Property
    More Options
    Connect with us