PROPERTY INTELLIGENCE
If renovating is preferred , always consider the ceiling price achieved for the area that you ’ re investing in , which is where an experienced and informed real estate agent can assist . The last thing you want is to overcapitalise and then find it hard to sell . When renovating , try to complete the project within a few months so that you can flip quickly and aim to sell the home within six months – the quicker the better to reduce holding costs .”
When you are considering medium to longer term investment options , there are essentially three key factors to bear in mind : risk , return and growth . If minimising risk is important , then you should consider a diversified portfolio or perhaps a portfolio with a number of small investments spread across a few nodes . If you have a lot of money to invest , then perhaps longerterm capital appreciation is your main priority , in which case you require a solid investment portfolio in the most sought-after areas .
From a rental perspective , I suggest that you consider investing in multiple smaller properties , gear them and let them pay for themselves over time . Property is one of the few asset classes against which one can borrow , which is especially beneficial when interest rates are still relatively low , which means that the benefits of gearing can be maximised , improving the net return to the investor . In my opinion , this strategy is far better than putting all your eggs into one , more lavish basket .
82 AUGUST 2022 SA Real Estate Investor Magazine