Real Estate Investor Magazine South Africa February/March 2019 | Page 24

GETTING STARTED
ADVERTORIAL
How to find excellent returns in a slow
market – invest with responsible partners
BY PROPERTY ASSIST
A
ccording to the latest FNB report in real terms, which
includes the impact of inflation, house prices have
declined by 20.8% since August 2007, from the peak
of the pre-2008 boom period. The constant negative general
media reports coming through various property analysts is not
all doom and gloom for investors in 2019, according to Daniel
Lombard, Director of Property Assist.
In short the forecasts that FNB make are that residential
property expects growth rates will fluctuate between 3.5% and
5% while residential rental net yields will only deliver between
5% and 7% per annum. Not a good return that will excite any
investor wanting to outperform the market averages.
The question asked by property investors is how do you
combat this and secure property investments in 2019 that will
generate above average returns?
Here are methods and principles you can use which Property
Assist currently utilizes to ensure above average returns:
• Do not let greed or fear drive you during your investment
process
• Purchase properties from owners that are in distress
without taking advantage of the owner’s misfortune to
enrich yourselves unfairly (Negotiate a win-win transaction
for all, including for the owner in distress)
• The number one factor that determines a higher than
average return is a proper assessment of the true value of
the property
• Secure all your returns and terms upfront before signing
any agreements
• Ensure that your transaction is facilitated by experts in the
distress property market
• Get experienced assistance with due diligence on the seller
and on the property is prime
• Before paying deposits and fees to any third parties ensure
that the risks are mitigated, and suspensive conditions are
met
• Utilize existing and established professionals with proper
track records
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FEBRUARY/MARCH 2019 SA Real Estate Investor Magazine
• Property inspection and structural due diligence by
specialists is key to avoid pitfalls and unexpected losses
down the line
• Ensure that all participating role players all benefit during
the transaction
• Ensure your finances and investment strategy is in order
prior to starting to invest
• Do not accept that every estate agent knows the market in
a specific area – ensure that they are true area specialists
• Make sure payment of fees for services and knowledge is
based on
• performance and results
• Align the interest of all parties to achieve the final outcome
as envisaged
• The notion of making a difference and impact in others’
lives should be foremost in your thinking
Implementing these methodologies in your future property
investment strategies will ensure that you minimize risk, avoid
pitfalls and enable you to secure higher predetermined returns
of above 15% p.a. returns as the norm. You can also ensure
these solid returns whilst helping those in need with the right
strategy and right team in place.
Despite the low predicted capital growth rates and low
forecasted rental returns, Property Assist has been able to
consistently achieve higher than average returns over the last 5
years for many investors.
The right property can consistently deliver higher than
average returns in the medium to long term and if approached
correctly with experienced parties. The team you choose to
work with need to have the character and value system that
ensures that when things go wrong (because at some point it
may) that they will not disappear, but stand with you through
the process to recover and turn it into a good result.
There was a very wise man that once said, what you sow
is what you will reap and therefore make sure the way you
approach property investment is the same.