I remember sitting with a business coach 5 years ago and discussing my 5 year goals and game plan. Let’s face it, there’s not one person on the planet today that sat down in 2015 and got anywhere close to predicting what their life would look like in 2020. No one in their wildest dreams could have predicted how upside down our world would be and how much “bleep” would have hit the fan in just 7 months.
Let’s be frank though, fortunes aren’t really made in times of prosperity and economic growth. Real wealth is made during a recession, or even a depression, which is a potential scenario for our beloved South Africa these days.
2025 is 4 years and 4 months away and some investors would have made a fortune and be smiling, while other’s will be reminiscing about the good old days before Covid and the crisis of 2020 and wishing what they should’ve, could’ve or would’ve done… but didn’t.
So, let’s pretend it’s August 2025. Spring is about to arrive and you are “today” + 5 years older. Your young 13-year-old in 2020 is 18 now and getting ready for University, and perhaps you would like to be able to offer them an overseas education. Or if you have toddlers, your spouse just handed you the fee schedule for Grade 1 in private school and if you are like me, you’re thinking: “is that figure per month or per quarter?” My entire high school career didn’t cost what one of my kids’ annual private school fees cost.
Now here’s the thing: some people will be generating residual income from investments they made in real estate during the train wreck that was 2020. The capital growth and rental income that has inevitably, and predictably, increased over the past 5 years will allow them to refinance some of their properties, tax free, and pay upfront for their kids’ education, or overseas family vacation, or buy more real estate with sizeable deposits and create even more income, without negatively affecting their current cashflow. You might be thinking this sounds like a pipedream, but it is possible and can be a reality.
“If you don’t change direction, you are going to end up where you are headed”.
Property has always been one of the safest investments and remains a market with resilience. People will always need a place to live and if they can’t buy, they have to rent – which offers some measure of security in terms of a property investment holding steady in volatile times.
Real estate investing is not gambling, it’s not a quick buck or a scheme to make money overnight. It’s a process and it takes time with certain fundamentals being non-negotiable like cashflow, positive cashflow. Cashflow is like oxygen. If you have it, you don’t think about it too much. However, cut the supply and all of a sudden it becomes the only thing that occupies your mind.
Here’s my best advice, having survived (only just) the Global Financial Crisis of 2009, which now seems more like a stroll in the park compared to the 2020 Covid chaos. Buy cashflow positive real estate that has the potential for capital growth, and you can survive just about any downturn or future crisis.
Here’s some wisdom from the Late Jim Rohn: “Don’t let your learning lead to knowledge. Let your learning lead to action.”
Five years from now when people ask you how you recovered so well since 2020, it will be what you actually did that will determine where you are, not what you intended to do. Buy cashflow positive properties now. With the low interest rate, it’s the perfect time to start investing, if you haven’t already. If you’re unsure of where to start, contact me, I have many years’ experience and specialize in Investment Opportunities.
You can also check out an example of a cashflow positive property: The Base Apartments. Click the link below to the website for more information, it could be a lucrative click for your future.
Author: Ryan van Heerden
Founder and Director of www.ryansrealty.co.za
Ryan’s Realty specializes in managing rentals for investors and offering exceptional Investment Opportunities to clients.