Estate Living Magazine Investment - Issue 34 October 2018 | Page 26

Another benefit of investing in retirement property at a young
age, says Rawson, is that interest on a mortgage is tax deductible.
Shoreline Sibaya’s Alan Beesley says that buying into a R1.5
million unit and putting down 10% deposit will mean a bond
of about R13,000 a month for 20 years. ‘Initially, you may have
a shortfall of say R2,000 or R3,000 a month, but rentals escalate
while bond repayments remain the same, and it will even out
quickly.’
If investors are in a position to put down a 20% deposit, says
Beesley, their rental will be adequately covered.
Beesley has personally bought two units at Shoreline Sibaya.
‘Buying off-plan in phase one is usually the
prudent way to go in this kind of
investment, as you get in early
enough to see major returns.
Also, when buying off-plan
you benefit from not having
to pay transfer duty.’ While
buying off-plan can come
with some uncertainty,
Beesley suggests that
investors do some research
on who is involved for
peace of mind. In Shoreline
Sibaya’s case, any perceived
risk, he says, is mitigated by the
developers’ good reputation and the
fact that Tongaat Hulett, who are releasing
the coastal land, is a major SA company.
Peet Strauss, PGP’s Johannesburg Development Manager,
says: ‘Today’s older generation is remaining not only young at
heart but pursuing a host of sports and keep-fit activities.’
He says estates like Heritage Estate, in Modderfontein,
Johannesburg, near Modderfontein Nature Reserve, are a good
example of what owners or investor s are looking for these days.
‘It attracts investors of any age who either intend to live there or
purchase and rent out their apartments or cottages to suitable
tenants – the over 50s – at market-related rentals. Prices there
start at R1.325 million.’
Lakeside and Thornhill are home to upmarket residences that
fetch prices from approximately R3 million to as much as R8.4
million.’ Making it marketable, besides the location, he says, are
the ‘modern lock-up-and-go units with state-of-the-art security
and a healthcare service, including both primary care and
assisted living options’.
Bruwer de Jager, sales consultant of The Plettenberg Manor,
says the first rule for potential investors is to get in early.
‘Investing in phase one off-plan will usually mean more
capital appreciation than investing in phase three,’ he says,
corroborating what Beesley says. He says the properties in
The Plettenberg Manor – an exclusive retirement resort near
Plettenberg Bay with assisted living apartments, luxury cottages
and exclusive houses with private swimming pools – that started
at R2.5 million are now worth R3.5 million. And at that price, it’s
unlikely that a bond will be covered purely by rental. ‘The real
value now in this development at the more exclusive end of the
market lies in capital appreciation,’ says de Jager.
Petro de Jager, estate agent of Devmark Property Group’s
seventh retirement development (Helderberg Manor in
Somerset West), agrees that the retirement market is huge.
‘What you pay now is considerably less than what you’ll pay in
a few years,’ she says, ‘so the return of capital is almost certain.’
She concurs with Bruwer de Jager (no relation). ‘In usual
circumstances, the retirement market can only afford a specific
ceiling in rental, so that may not cover your bond if it’s too high.’
Units at Helderberg Manor, located at the foot of the Helderberg
Mountains, are selling for between R1.5 million and R3.5 million,
so there is a good mix of options for retirees, she says.
Bill Rawson says a welcome feature in any property investment is
that capital growth can create a very useful emergency nest egg.
‘While most retirement annuities have limits to how much capital
you can withdraw as cash on retirement, properties can be
sold at any time to liquidate their full value. Having that capital
available in an emergency can be very comforting,’ Rawson says.
‘Retirement property makes an excellent investment, and the
earlier you get started, the greater the rewards.’
Says Strauss: ‘With the ongoing planned future development
of Modderfontein, Heritage Estate offers a sound investment
opportunity for buyers. Neighbouring secure estates such as
Nia Magoulianiti-McGregor
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