Real Estate Investor Magazine South Africa November 2013 | Page 38

PROPERTY FORUM

DOES THE AMERICAN WAY WORK
IN SOUTH AFRICA?
JT FOXX
JT Foxx is a serial entrepreneur and real estate investor and is known worldwide as one of the top speakers
and coaches in the wealth creation, real estate and business sectors. He has also been a radio personality
over the last seven years. Originally from Canada, he started eight years ago with $974 and a very old Ford
Ranger pick up truck. His areas of expertise are marketing, branding, sales, strategic thinking
and investing. He is also the founder of the world-renowned events Mega Partnering
and Mega Partnering Africa.

W

ell, after my eighth visit in six months, after teaching thousands of clients all around the country, and after personally
doing business there myself, the answer is yes and no. There are three characteristics that define any successful
property investor in today’s new real estate economy. The first characteristic is knowing how well you are branded,
the second is knowing how good your marketing is, and the third is knowing how good your relationships are. After
visiting a property auction to view 20 properties up for sale and to see only two of them available at the time of auction, I quickly
realised that success in property in South Africa is not what you know, not whom you know, but who knows you. If the property is on
the market for everyone to see, I and many other successful investors have probably already seen it first.
The market here in South Africa, as it did in the United States, took some very
huge hits in 2007-2011. The reality is that only just now, both countries are finally
getting out of their hole though many homeowners are still owing more to the
banks than what their property is worth. Now that the market is coming back
strong in both countries, I am seeing people repeat the same mistakes they did
five years ago. Here are someone of those mistakes.
Mistake 1: Relying on the banks too much for capital
Whether you are in SA or the US, banks will rarely lend for more than 1-4 properties
if you are a small investor. Banks are afraid of making the same mistakes they did
before and are much more likely to lend to people who have a track record This
is where the American way comes in: creative real estate. I have heard far too
many people here say things like owner financing, lease options and flipping
properties don’t work. Well I believed it myself until I decided to try it myself. It’s
actually easier here than it is in the US. The only challenge I faced is educating
the attorneys, brokers and homeowners of the benefits of doing deals creatively
and that it is legal.
Mistake 2: Using all of your own money to buy properties
I bought my first 500 properties without using any of my own money. Mr. Trump
once told me, “It doesn’t matter who you are, the better you are at investing, the
more likely you are to run out of money”. This c ??gFV?&RF?R??72?bFVF??f?"???&?W'G???fW7F?'2?????R??B??B6?g&VW?R??R?WBg&??'W???p??F?W"&?W'F?W2?"?b??R&R??F?R?FF?R?b&??V7G2???R6?'V??WB?b???W???6??WF???r??fR?gFV?6VV??V??W&R?v?W&Rv??&R??fW7F?'2fV?GW&V@??WB?B&??WB?b???W???F?R?FF?R?bF?V?"&V?W7FFR&??V7B?F?R?W?F?????r?FW&?w&?wF?f?"??fW7F?'2v????B???v?BF???fW7B?W&R??6?WF?g&?6?'WB?6?v??&????2'V??F??r'F?W'6??2???R&R???2v??B2F?RV??R??P?7W'&?V?B??W'6V?bv?F??F??2?26??WF???r??fR?Vf??f?7W6VB??F?FV6?B??&?W'G?F?W'27&?72F?R6?V?G'??W6R??W"66?f?"????r??6R?????fWF??P?FV?2?BW6R'F?W'6??6?F?F?w&?r??W"'W6??W72?3@????fV?&W"#24&V?W7FFR??fW7F? ???7F?R3?v?&??r????W"??fW7F?V?G0?F?W&R&RG&??W'2?W&R??6?WF?g&?6F?B&RFV6???r??RF?Rv?F???P????W???&?W'F?W2?2?????R?fRF?'W?F?V??f??B&V?FW"????BF?V?f?"F?&VP??V'2??fR?VvF?fR66?f??r??BF?V???F?&VR?V'26V???B?F?R?W&?6?v???2?v?2&VV?( ??R??R???W?v?V???R'W?&V?W7FFR???Bv?V???R6V????N( ???b??R?fRF?F?R???W??WB?b??W"?6?WBWfW'????F?F???RF?RFV??v?&???N( ?2??Bv??BFV??v?W&R?W&?6?( ?2vV?Bw&??r?2F?BvR&V6??RF???w&VVG??F?R?&?WBv?B??B??Bv?BfW'?6??WF?F?fR????W?v26?V??BvP?7F'FVB'W???r&?W'F?W2????rF?R&?6Rv?V?Bv?W?F?B?2??B??&WGFW ?F??v?&??r?B??F?RV?BF?R??W6R?v?2v??2??BW7V???G2??B??W'2??F?R?W&?6?v??2&V?6??rF?BV??W72??R&R6??f??r&?&?V?2?"f??F??p?6??WF???2??Rv??( ?B??R???W???&?W'G??F?R?W&?6?v??2&?WBF???p?v?FWfW"?BF?W27&VF?fV?F?vWBFV?F??R?B?fR?BgV?FVB'?6??V??P?V?6R?F?R?W&?6?v??2&?WB????r?VG26??RF???RF?&?Vv?6?WfW ??&?WF??r?B'&?F??r?F?R6?WF?g&?6?v???F?R?F?W"6?FR?2&?WBF???p?FV?2v?F???FVw&?G??B???W7G???N( ?2&?WB?f??r6&Rf?"F?R?F?W"W'6????P?&R?V???r?B?N( ?2&?WB&V?6??rF?R?&?WB?2&?rV??Vv?f?"????fW7F?'2?@?F?W&R?2V??Vv?&???f?"???bW2F???R???W???F?RV?B?F??( ?B6??vRv????R&R?&R&?VBF?&R6?WF?g&?6????R?`?F?R&W7B6?V?G&?W2??fRWfW"F??R'W6??W72???v???R??F?R?F?W"??B?v?V?B6??W2F?????r???W??WB????W"???VW2?B&V6W6R?b??RF??( ?B???P?v???&R?VgB?WB?b???w&VBFV?2?6??R6VRf?"??W'6V?b??r7&VF?fV???F???r&?F?&?W'G?FV?2?B'W6??W72FV?2B??R?b??fRWfV?G2Bwwr?Df????fR?6???6??N( ?2?&???2??r???V??R?W&R&R6???????r&?WBF?P??&?WB?v???R??&R?B??&R?W&?6?2&R'&??v??rF?V?"?W&?6?F???'2?W&P?F?'W?&?W'F?W2?v?BF?W?F??( ?B&V?6R?Bv?B?F?Bg&??F???2F?BF?W??F??( ?BF????F?R?&?WB?W&R??6?WF?g&?6v???6?WBF?V??WB?????fW7F??r??$U4?U$4U0??Bd????&v?F???wwr?&V??r?6??????