The information in this article is courtesy of iAfrica (Why renting rules … - 23 April 2009).
Tough lending criteria and high deposits have made it impossible for many to buy property. Renting hasn’t just become a reality for those who can’t afford to buy, but also for people who feel like they are spending the best years of their lives with a financial ball and chain around their ankles. Here is why most people prefer to rent:
A lot of people recon that you are throwing water down the drain by renting, but if you take in consideration the amount of money you save when renting, this statement might be nothing but a cliché.
Renting means you pay a monthly fee, which includes all repairs and maintenance should something break. You as the tenant know exactly what amount of money you will spend on you accommodation and you don’t have to anticipate extra costs.
In the first few years of ownership, most of what you're paying into your bond goes to interest, not the capital. Isn’t that almost like throwing money into the water? Also, homeowners needs to be prepared for all other expenses like property taxes, levies, insurance, maintenance fees etc. You might be better of investing in stocks.
Renting is a great option for families that want to expand but can’t buy a bigger property. Renting deposits are relatively low and you can look forward to getting you deposit back. This way your family will have the space they need without breaking the bank.
Renting is a hassle-free way of living without responsibility towards the property you live in. Let the landlord take care of everything.
Renting is an easy way of not tying yourself down. You simply give notice and you are free to go. If you are planning on moving, or if you require traveling a lot, it might be easier to rent as maintenance and costs are low.
Thursday, April 23, 2009
Thursday, April 16, 2009
Property Prices and Crime
The information in this article is courtesy of Realestateweb (Crime and your property’s value – 15 April 2009).
According to the FNB Residential Property Barometer Q1 2009, 10% of total sellers of residential property are selling because of safety and security reasons.
The Barometer shows that Gauteng showed 12% of seller moving for safety reasons and the Eastern Cape 17%. KwaZulu Natal showed 6% with the Western Cape having 5% of the province’s sellers moving because of crime.
John Loos, FNB Property Strategist, are also of the opinion that more and more people are moving to secure places such as gated communities and complexes compared to freehold homes.
However, Loos explains, the impact of crime on the property market affects the long term of property performances in the sense that property owners have to spend more money on crime prevention and security measures in their properties.
This does not mean that there will be a sudden increase in property prices in secure areas. Loos recons that the turn of the market might see prices rising in places conceived as safe and secure.
Loos said to keep in mind that people also move to gated communities as they are convenient and offers the “lock up and go” option.
The current situation in South Africa shows that property prices in places like Dainfern in Johannesburg are holding up nicely, but this might also mean that the wealthy people living in these areas have more cash, so they are not as interest rate sensitive.
Loos added that Johannesburg is the business hub of Southern Africa and businessmen has no choice but to live close to this city. These businessmen are more likely to live in safer places close to Johannesburg.
According to the FNB Residential Property Barometer Q1 2009, 10% of total sellers of residential property are selling because of safety and security reasons.
The Barometer shows that Gauteng showed 12% of seller moving for safety reasons and the Eastern Cape 17%. KwaZulu Natal showed 6% with the Western Cape having 5% of the province’s sellers moving because of crime.
John Loos, FNB Property Strategist, are also of the opinion that more and more people are moving to secure places such as gated communities and complexes compared to freehold homes.
However, Loos explains, the impact of crime on the property market affects the long term of property performances in the sense that property owners have to spend more money on crime prevention and security measures in their properties.
This does not mean that there will be a sudden increase in property prices in secure areas. Loos recons that the turn of the market might see prices rising in places conceived as safe and secure.
Loos said to keep in mind that people also move to gated communities as they are convenient and offers the “lock up and go” option.
The current situation in South Africa shows that property prices in places like Dainfern in Johannesburg are holding up nicely, but this might also mean that the wealthy people living in these areas have more cash, so they are not as interest rate sensitive.
Loos added that Johannesburg is the business hub of Southern Africa and businessmen has no choice but to live close to this city. These businessmen are more likely to live in safer places close to Johannesburg.
Friday, April 3, 2009
Suza Orman Buys Property in South Africa
The information in this article is courtesy of iAfrica (Orman Invests in SA - 3 April 2009).
Do You Need Any More Proof?
World-renowned finance guru, Suze Orman, recently invested in a property in South Africa. She picked an apartment in the posh suburb of Northcliff in Johannesburg to add to her property portfolio.
This highlights the fact that the South African property market – especially at the upper end – has loads of growing investment potential - and it stretches further than Cape Town and the Atlantic Seaboard.
Orman says her motivation for buying in Johannesburg is simple – location. According to Lew Greffen, chairman of Sotheby’s International Realty in South Africa, the city of Johannesburg has been attracting investors for quite a while as they see this area as the real gateway to potentially lucrative South African and African markets. Cape Town, on the on other hand, is where the money goes on holiday.
Greffen explained that property in Johannesburg’s upmarket suburbs are also very affordable if you are buying in pounds or dollars and property here and unlike the ones in Cape Town and the Atlantic Seaboard, has and increasing rarity premium
Invest in holiday homes in Knysna
Do You Need Any More Proof?
World-renowned finance guru, Suze Orman, recently invested in a property in South Africa. She picked an apartment in the posh suburb of Northcliff in Johannesburg to add to her property portfolio.
This highlights the fact that the South African property market – especially at the upper end – has loads of growing investment potential - and it stretches further than Cape Town and the Atlantic Seaboard.
Orman says her motivation for buying in Johannesburg is simple – location. According to Lew Greffen, chairman of Sotheby’s International Realty in South Africa, the city of Johannesburg has been attracting investors for quite a while as they see this area as the real gateway to potentially lucrative South African and African markets. Cape Town, on the on other hand, is where the money goes on holiday.
Greffen explained that property in Johannesburg’s upmarket suburbs are also very affordable if you are buying in pounds or dollars and property here and unlike the ones in Cape Town and the Atlantic Seaboard, has and increasing rarity premium
Invest in holiday homes in Knysna
Thursday, March 26, 2009
D.I.Y Garden Tips
The information in this article is courtesy of iAfrica (10 Steps to a New Garden – 17 March 2009).
Deciding to improve your garden is a very wise choice, not only because you add value to your house but also because it does a lot for the first impression of your home. Here are some tips to get you started on your new garden:
First of all, find out what you want. You can browse through some books or ask the advice of family, friends and experts. A new garden needs to be practical so take in consideration what will best suit your household including children, pets, space etc.
Make sure just how much you can afford and draw up a budget.
Map out your garden including the position of the pool, garage, driveways etc. This way it will be easier to visualise what you want to do.
You might want to decide on a style like Japanese, indigenous, tropical. Do some research on the Internet about the different style and what it brings to your garden.
Keep the climate in consideration. You can’t have a tropical garden in a semi-dessert area. Also, know your soil and take time to prepare it.
Now you can start preparing your garden by dividing it into hard and soft landscaping areas. Hard landscaping needs to be done first and includes putting in pathways, fences, patios etc. Clear all weeds and grass before you start with the soft landscaping
Read the instructions on how and where to plant everything. Ask the expert at the nursery to explain how you should go about planting.
Mulch is any material placed over soil in the garden. It's designed to retain moisture, deter weeds and keep the soil from eroding. You can buy this at a garden centre of you can make your own by shredding leaves, sticks, grass, bark and compost.
Remember to water plant regularly and enjoy your garden.
Buy holiday apartments in Knysna
Deciding to improve your garden is a very wise choice, not only because you add value to your house but also because it does a lot for the first impression of your home. Here are some tips to get you started on your new garden:
First of all, find out what you want. You can browse through some books or ask the advice of family, friends and experts. A new garden needs to be practical so take in consideration what will best suit your household including children, pets, space etc.
Make sure just how much you can afford and draw up a budget.
Map out your garden including the position of the pool, garage, driveways etc. This way it will be easier to visualise what you want to do.
You might want to decide on a style like Japanese, indigenous, tropical. Do some research on the Internet about the different style and what it brings to your garden.
Keep the climate in consideration. You can’t have a tropical garden in a semi-dessert area. Also, know your soil and take time to prepare it.
Now you can start preparing your garden by dividing it into hard and soft landscaping areas. Hard landscaping needs to be done first and includes putting in pathways, fences, patios etc. Clear all weeds and grass before you start with the soft landscaping
Read the instructions on how and where to plant everything. Ask the expert at the nursery to explain how you should go about planting.
Mulch is any material placed over soil in the garden. It's designed to retain moisture, deter weeds and keep the soil from eroding. You can buy this at a garden centre of you can make your own by shredding leaves, sticks, grass, bark and compost.
Remember to water plant regularly and enjoy your garden.
Buy holiday apartments in Knysna
Tuesday, March 10, 2009
Buying Property Together
The information in this article is courtesy of iAfrica (Buying property together – 9 March 2009)
Strict lending criteria and large deposits have made the dream of owning one’s own property somewhat out of reach. Even if you are thinking of buying a modest R700 000 property you would need R70 000 deposit and another R70 000 for all other costs and fees. This is not exactly the kind of money that first-time buyers have and therefore they often opt to buy property by pooling together with friends or family members.
Think about it: You and a friend or family member spend a substantial amount of money each month on rent. If you buy property together you can cut your monthly living expenses and avoid throwing rent money down the drain. This way you will also build up equity in an asset and you would have more disposable income.
iAfrica gives the scenario of cousins Sarah and Jack. They have a combined income of around R50 000 per month, good jobs and a clear credit record. If they applied to the bank for a pre-approved loan on a R500 00 home they would have no trouble getting the finance. Both names would appear on the bond and registration documents.
Five years down the road they may decide to part and when they sell the property they are more than likely to have made a profit. This profit would be split down the middle, which will allow them to put down a deposit on their own home.
It is however important to have a detailed written agreement spelling out all clause such as living arrangements, alterations to the property, accidental death etc.
Another scenario might be that you and a friend/family member want to purchase a buy-to-rent property. This is especially popular in times when interest rates are low.
It is better to buy a second property once your bond it fully paid off. Although this kind of property is a risk, buying with someone means that you can afford a better property in a good area, ensuring higher rental income.
Buy Knysna property
Strict lending criteria and large deposits have made the dream of owning one’s own property somewhat out of reach. Even if you are thinking of buying a modest R700 000 property you would need R70 000 deposit and another R70 000 for all other costs and fees. This is not exactly the kind of money that first-time buyers have and therefore they often opt to buy property by pooling together with friends or family members.
Think about it: You and a friend or family member spend a substantial amount of money each month on rent. If you buy property together you can cut your monthly living expenses and avoid throwing rent money down the drain. This way you will also build up equity in an asset and you would have more disposable income.
iAfrica gives the scenario of cousins Sarah and Jack. They have a combined income of around R50 000 per month, good jobs and a clear credit record. If they applied to the bank for a pre-approved loan on a R500 00 home they would have no trouble getting the finance. Both names would appear on the bond and registration documents.
Five years down the road they may decide to part and when they sell the property they are more than likely to have made a profit. This profit would be split down the middle, which will allow them to put down a deposit on their own home.
It is however important to have a detailed written agreement spelling out all clause such as living arrangements, alterations to the property, accidental death etc.
Another scenario might be that you and a friend/family member want to purchase a buy-to-rent property. This is especially popular in times when interest rates are low.
It is better to buy a second property once your bond it fully paid off. Although this kind of property is a risk, buying with someone means that you can afford a better property in a good area, ensuring higher rental income.
Buy Knysna property
Tuesday, March 3, 2009
10 Important Steps to Buying Your First Home
Most people might buy a house in some point of their lives - possibly more than once. It is a daunting process by with the help of experts you will find that it can be more rewarding than you think. Here are some important steps to follow:
1. Find Out What Your Budget Is
The first step to buying a home is to find out how much home you can afford. Review your monthly income, expenses and savings. Always remember that as a first time buyer you would need a substantial amount of cash in hand to settle closing costs.
2. Get Your Loan Pre-Approved
Having a pre-approved loan basically means your credit files have been reviewed and the loan officers believes you can readily qualify for a given loan amount with one or more mortgage providers. A letter will be given to you showing your borrowing power, which can be used to show agents or sellers that you are a serious buyer.
3. Do Research on the Area
Once you have chosen an area that seems right for you, you can start doing the necessary research. Find out what houses are going for in the area and make sure you can identify with the community in the area. It is better to go see the area in person, for you might miss crucial information should you do research on the Internet.
4. Find an Agent
There is no shortage when it comes to estate agents in most parts of the world. The more popular or sought after an area is, the more agents you will find. It is important to find someone you trust and who you feel comfortable with. The right agent can save you a lot of time and money.
5. Make an Offer
So you’ve done your research and you found an agent who helped you find the home of your dreams. It is time to make an offer: Use your research to determine if you have yourself a good deal and should you think that the asking price is to high, be prepared to defend it with your research. This is a crucial part of the home buying process and you shouldn’t let anyone push you into making a decision.
6. Negotiate the Best Price
A seller can respond in different ways to your offer. He/She can accept your offer, counter bid or go back to the asking price. Don’t give in to easy and if it seems to good to be true, you must trust that the inspection will show you the hidden problems. Once you’ve agreed on a price it is time to sign the contract. You might have to put down a deposit – in which case you must make sure the contract states that you can get the money back when you withdraw your offer.
7. Get an Inspection
Let you agent recommend a trustworthy inspector. If there are any repairs to be made, remember to get the inspector in again once the amendments have been made. Don’t try to cut corners on this step – it might be very costly.
8. Close the Deal
This is the most exciting part of the process – when the key to the house gets handed to you. Lots of paperwork needs to be done but your agent will guide your through the process. Have a bottle of champagne ready!
9. Move In
You are now ready to move into your first home. Get a trustworthy moving company and make sure to do the necessary cleaning before the moving truck arrives. Thorough planning will make this an easy and exciting day.
10. Manage your Investment
Your house is your investment and you need to guard it with your live. You would be wise to get fire, theft and liability insurance. It is wise to upgrade your house by putting in a pool or adding a room, but always make sure you speak to the experts before you make any decisions.
1. Find Out What Your Budget Is
The first step to buying a home is to find out how much home you can afford. Review your monthly income, expenses and savings. Always remember that as a first time buyer you would need a substantial amount of cash in hand to settle closing costs.
2. Get Your Loan Pre-Approved
Having a pre-approved loan basically means your credit files have been reviewed and the loan officers believes you can readily qualify for a given loan amount with one or more mortgage providers. A letter will be given to you showing your borrowing power, which can be used to show agents or sellers that you are a serious buyer.
3. Do Research on the Area
Once you have chosen an area that seems right for you, you can start doing the necessary research. Find out what houses are going for in the area and make sure you can identify with the community in the area. It is better to go see the area in person, for you might miss crucial information should you do research on the Internet.
4. Find an Agent
There is no shortage when it comes to estate agents in most parts of the world. The more popular or sought after an area is, the more agents you will find. It is important to find someone you trust and who you feel comfortable with. The right agent can save you a lot of time and money.
5. Make an Offer
So you’ve done your research and you found an agent who helped you find the home of your dreams. It is time to make an offer: Use your research to determine if you have yourself a good deal and should you think that the asking price is to high, be prepared to defend it with your research. This is a crucial part of the home buying process and you shouldn’t let anyone push you into making a decision.
6. Negotiate the Best Price
A seller can respond in different ways to your offer. He/She can accept your offer, counter bid or go back to the asking price. Don’t give in to easy and if it seems to good to be true, you must trust that the inspection will show you the hidden problems. Once you’ve agreed on a price it is time to sign the contract. You might have to put down a deposit – in which case you must make sure the contract states that you can get the money back when you withdraw your offer.
7. Get an Inspection
Let you agent recommend a trustworthy inspector. If there are any repairs to be made, remember to get the inspector in again once the amendments have been made. Don’t try to cut corners on this step – it might be very costly.
8. Close the Deal
This is the most exciting part of the process – when the key to the house gets handed to you. Lots of paperwork needs to be done but your agent will guide your through the process. Have a bottle of champagne ready!
9. Move In
You are now ready to move into your first home. Get a trustworthy moving company and make sure to do the necessary cleaning before the moving truck arrives. Thorough planning will make this an easy and exciting day.
10. Manage your Investment
Your house is your investment and you need to guard it with your live. You would be wise to get fire, theft and liability insurance. It is wise to upgrade your house by putting in a pool or adding a room, but always make sure you speak to the experts before you make any decisions.
Monday, February 9, 2009
Happy tenants = More rent = Better investment
The information in this article is courtesy of Realestateweb (12 Tips for Landlords – 26 September 2007)
So you bought a buy-to-let property with great hopes of paying of the bond while you secure a profit. But what happens if you can’t find a tenant or you tenant makes a runner. How do you get it right? Here are some tips to help you keep tenants happy and paying on time.
Keep all correspondence regarding your rentals. This means you need a form for everything under the sun. Make sure these forms are well organised.
Never trust a verbal agreement. Get everything in writing, for this way there won’t be any misunderstandings of misinterpretations.
This might not always be possible but try to meet the tenant. Building a relationship with a tenant can often lead to longer tenancies.
Because they play such a vital role in your investment it is sometimes necessary to send gifts to thank agents/tenants. See this as adding value to your investment and securing the tenant’s trust and an agent’s time and effort.
Make a list of what you require from a tenant/agent and ask for feedback.
Give tenants an appreciation bonus instead of penalties. This means that you can include in the lease that you will pay a sum of money on top of the deposit should the tenant pay rent on time or agree to you checking the property once every two months. This way the tenant’s deposit builds up to a lump sum of money and you get your rent on time. Also, offer an appreciation bonus for a debit order.
Another great way to obtain higher rental is to furnish your property. This will attract tenants who are not staying for too long, shopping to buy or students.
Yet another way to obtain higher rental is to upgrade the property - even if it is a small item like a ceiling-fan. If you make bigger upgrades like putting in a pool, you can charge more rent or ask the tenant to pay half.
If you offer a weekly cleaning service it means that you have a direct line to what is happening in your property. If there is anything that needs attention you can attend to it right away.
When you buy rental insurance you are covered for a certain period of time, which could come in handy should the worst happen.
Buy Garden Route Property
So you bought a buy-to-let property with great hopes of paying of the bond while you secure a profit. But what happens if you can’t find a tenant or you tenant makes a runner. How do you get it right? Here are some tips to help you keep tenants happy and paying on time.
Keep all correspondence regarding your rentals. This means you need a form for everything under the sun. Make sure these forms are well organised.
Never trust a verbal agreement. Get everything in writing, for this way there won’t be any misunderstandings of misinterpretations.
This might not always be possible but try to meet the tenant. Building a relationship with a tenant can often lead to longer tenancies.
Because they play such a vital role in your investment it is sometimes necessary to send gifts to thank agents/tenants. See this as adding value to your investment and securing the tenant’s trust and an agent’s time and effort.
Make a list of what you require from a tenant/agent and ask for feedback.
Give tenants an appreciation bonus instead of penalties. This means that you can include in the lease that you will pay a sum of money on top of the deposit should the tenant pay rent on time or agree to you checking the property once every two months. This way the tenant’s deposit builds up to a lump sum of money and you get your rent on time. Also, offer an appreciation bonus for a debit order.
Another great way to obtain higher rental is to furnish your property. This will attract tenants who are not staying for too long, shopping to buy or students.
Yet another way to obtain higher rental is to upgrade the property - even if it is a small item like a ceiling-fan. If you make bigger upgrades like putting in a pool, you can charge more rent or ask the tenant to pay half.
If you offer a weekly cleaning service it means that you have a direct line to what is happening in your property. If there is anything that needs attention you can attend to it right away.
When you buy rental insurance you are covered for a certain period of time, which could come in handy should the worst happen.
Buy Garden Route Property
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