Stability, profitability and prosperity — the South African residential real estate market offers it all.
With the current interest rate cycle widely expected to start dropping later in 2024, a robust rental market and a plethora of advantages of owning your own home, this year is a fabulous time to start or enhance your property portfolio. With the right information and property investment tips, the road to enhancing your wealth begins here.
Why invest in residential real estate?
There are many reasons why residential real estate makes an outstanding investment opportunity. For starters, it is a tangible asset, which provides a sense of security by allowing you to physically inspect and assess the condition of your properties - quite unlike other investments like stocks. Also, sound real estate investments can be a good hedge against inflation. As the cost of living increases, property values and rental incomes may also rise, helping you to build sustainable wealth.
Over time, well-chosen residential properties are likely to increase in value, giving you access to capital gains when you sell the property. Over and above this, renting your property out provides a regular income to supplement your financial portfolio and help you pay off your assets.
What are the characteristics of a prime property?
The most important factor to consider when choosing your property is, as it always has been, location. The reason for this is that while every feature on your property can be changed, renovated or upgraded, the location of your property can never be changed. There are various factors about the location of a would-be investment property that need to be considered. For starters, what are the future plans for the area, and has the neighbourhood improved or deteriorated over time? How easy is it to access major roads and arterial routes from the area? What commodities and conveniences are on offer for people who live in the area?
Another characteristic of a prime property investment is its setting. Secure sectional title units will always be a popular option among South African tenants because of the security, flexibility and ease of maintenance that they offer.
In terms of configuration, a prime real estate investment must cater to the needs of its prospective tenants. A two-bedroom apartment offering at least 50 sqm of residential space provides a perfect home for a tenant who works from home, or who has a small child. Such a property should offer at least one parking bay. This investment will enable you to capitalise on the plethora of reasons why apartments make great residential investments.
If you’re looking to invest in a family home, a three-bedroom property of at least 100 sqm and a double garage is likely to be a prime investment opportunity. For example, this three-bedroom townhouse for sale in Umhlanga Central offers it all: proximity to workplaces, entertainment and the beach. The unit is ensconced in a well-run and secure sectional title with great security features and low levies.
In a nutshell, residential properties offer a tangible investment that grows over time with low risk - provided that you work with an experienced property practitioner to ensure that the investments you make are sound. Speak to one of Seeff’s widely experienced property practitioners today and make 2024 the year you climb onto the property ladder or grow your portfolio further.
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