“Buy when there’s blood in the streets, even if the blood is your own.”
– Baron Rothschild
“I will tell you how to become rich. Close the doors. Be fearful when others are greedy. Be greedy when others are fearful.”
– Warren Buffett (American business magnate, investor, and philanthropist)
History shows us this over and over again – there’s always been a cycle of growth and recession. Due to fear and uncertainty, most people end up selling when they should be buying. But property has always remained a market that bounces back with resilience.
People will always need a place to live and if they can’t afford to buy, they have to rent – which offers some measure of security in terms of a property investment holding steady in volatile times. This, along with the current buyer’s market conditions and the lower interest rate (the lowest in 22 years!), makes it a good time for investors to capitalize on property investments.
“Real estate provides the highest returns, the greatest values and the least risk.”
– Armstrong Williams (Entrepreneur)
A cash flow strategy involves investing in properties with high rental yield potential and a rental income that is greater than the total expenses of holding the asset. Just ask any businessman… they will liken cashflow to oxygen.
But if you chase capital growth only, you’ll run out of serviceability, because you’ll get to a point where the bank says they will not lend you any more money because the cash flow isn’t there. But you also need growth properties to build your long-term equity.
Perhaps this is then the answer: a strategy that seeks to enjoy the best of both worlds by securing both growth and cash flow.
The Base Apartments gives you exactly this – the best of both.
The Base Apartments is an off plan residential development in Ferndale, Randburg, offering 1 bedroom apartments from R569,000, making it the perfect buy for investors looking for solid cash flow and capital growth, as well as the opportunity to benefit from the SEX13 tax deduction. (Contact us for more details about this benefit)
The project is expected to complete around the end of 2021 and rental is estimated at ±R5900 per month with a built in annual rental escalation. With only R10,000 deposit to secure and a bond of R559,000 at prime of 7.75% over 20 years your monthly repayment is a mere R4,931 (bank T&Cs apply). So, if the estimated levy is R650, then you actually net, after bond payment and levies, a positive R319 per month and your tenant pays off your property for you.
The Base Apartments is situated within walking distance of Randburg CBD. Demand for property in Randburg is high due to the good value for money and accessibility to the Sandton CBD. The Base is only a 15 minute drive from Sandton, Bryanston or Rosebank. It is surrounded by a multitude of small to large businesses, corporations, universities, gyms, colleges, hospitals, plenty of shopping centres and night life opportunities. Making it the perfect “base” for young professionals.
Yes, these are most certainly crazy, uncertain times, but it could turn out to be a great time of opportunity.