Advice for Commercial and Residential Property Investors in 2020

As was discussed in last month’s blog, the South African real estate market is entering quite an unpredictable time. Uncertain developments in property values, legislative worries, and shifting population dynamics are all set to affect the market in ways we can’t yet pin down. None of this means that investors should hold back on buying into real estate though. You can still invest and you can still make money. It’s just worth your while to follow some basic ground rules in the interesting year ahead of us. Here are five tips to guide you through the management of your property portfolio in 2020. 

Decide What You Want Before You Go In

Don’t go into the real estate market unprepared. Before you even start looking at new properties, draw up a game plan and decide exactly what you want to achieve with this property. Do you want a long-term, slow-growth investment? Or, are you after fast capital growth? Getting clear on this will arm you well for what lies ahead.

Buy in a Growth Area

Research your targeted areas carefully. And, be sure to only buy in neighbourhoods that have not only experienced consistent growth over the past few years, but that also seem set to continue on that trajectory. 

Try to Keep Emotion out of It

There is often a lot of emotions involved in property purchases. This is understandable, especially when you are buying your own home. If, however, you are buying only as an investment and are planning to rent or flip the property, you have to treat it as you would any other business transaction. Use your head, and weigh up both the pros and cons carefully.

Don’t Rush Anything

This has always been the case with real estate investment. You need to keep your eye on the long game and don’t rush any purchase or sale. Think carefully about any properties you are interested in purchasing. Do your research. Then, try to negotiate the best price. Hold out as long as you need to. If you should miss out on that particular purchase, don’t worry, another one will come. The same goes when you’re selling. Also know that you may have to nurture your property for a long time before you see a profitable sale. Building a good property portfolio takes time, especially if you have bonds on one or more of your properties. So, be prepared to take a long-term strategy.

Get a Property Advisor

The bigger your portfolio gets, the more you will need the services of a good property advisor to help you navigate the complexities of the real estate market. Secure the services of a good property advisor this year. It will enable you to let go of much of the heavy lifting in the management of your portfolio, particularly when the time comes to buy or sell.

These five tips are generally driven by laws of good, old-fashioned prudence. Think clearly, be careful, know when to leap and when to wait and you should be successful in the real estate market in 2020.

Jason Scholtz is the CEO of Envision Investments, and a leader in the property and strategic investment industry in South Africa. For more investor tips and an insider’s look into the South African market, be sure to get in touch, keep an eye on this blog or visit http://www.envisioninvestments.co.za/.

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