“To invest or not to invest, that is the question”
With the minor amount of plagiarism that used above I have managed to sum up the mind set of most of the South African population.
When deciding to invest, you must always be sure to follow the following steps:
The Do’s…
Research, research, research – Investigate the developer, investigate the area, investigate the amenities, as they say “knowledge is power”…
Location – Be sure to do your homework on the area, just because the price right in a secondary area does not mean that it will be a sure fire success, sometimes you need to spend money to earn money…
Buy well – Be sure to read through all agreements, make sure that you are covered both financially and legally…
Make sure the numbers work – Be sure to sit with your financial advisor to run the numbers, making sure as not to over extend yourself or expose yourself to an element of risk
Appoint the right advisors – there is no I in the word team they say, this is no truer than now. Having the right advisors and professionals backing you is paramount…
The Don’ts…
Never expect to ‘get rich quick – Gone are the days of the “flipping” mechanism of buying off plan and prior to registering selling. Property is a long term investment strategy; you will see a properties true worth and wealth grow over longer periods…
Never ignore the basics of supply and demand – as basic as the principle is, supply affects demand and vice versa. An over supply of property in an area will affect the demand substantially, where as if there is an under supply of property the supply with increase exponentially.
Don’t be influenced by your emotions – “Don’t fall in love with the property; fall in love with the deal” Dolf De Roos. Property is an investment, and an investment is all about the numbers, and if the numbers add up and the investment shows growth, what more matters?
Never be swayed by gimmicks – Never ever be caught out with cute sales gimmicks, for example: “Buy this apartment and we will pay your first 3 months bond instalments” – Ask yourself, why would they be willing to pay your bond repayments? Surely if the property was as good as they said it was, it would sell itself no doubt? But then saying that, sometimes distressed sellers may offer you the deal of the century when the property is in fact a good investment…
And finally…
NEVER SELL, property is a long term strategy. Where else can you use the banks money to finance your property, the tenants money to help pay back the banks money, and whilst all this is running its course, you deriving capital growth/ appreciation from an asset on a yearly basis…