Real Estate Investor Magazine South Africa November 2019 | Page 28

5
INVESTOR INTELLIGENCE
tips that could
make you millions
Insider lessons about real estate investment
EZRA RASETHE
In South Africa, successful real estate investors are a minority, but it doesn’t need to
be that way. Real estate investment in South Africa can make you millions - if you
know how to do it right. Here are the top five tips for profitable real estate investment:
1
Buy well
When you invest in property in South Africa with
the goal of building wealth, you need to buy well.
There are thousands of property deals online right now. How
do you know which ones will make you money? Oftentimes,
shiny things distract those new to property investment in
South Africa. Maybe they see a beautiful investment property
or speak to a so-called “real estate guru” that looks promising.
While these opportunities may look like they have potential,
they could be bad deals.
You make money in property when you buy well. Be sure to
do your research before signing any offer to purchase a property.
2
Avoid estate agents- or work
with the right ones
The number one way to be successful in business
is to maximise your profits while reducing your overhead
costs. Estate agents will cost you money. This is why I
suggest avoiding them when possible. While they do
provide a helpful service, their fees can add up until you’re
only making a portion of your expected profit.
However, another way to invest in property in South
Africa to make millions is to pick the right kind of estate
agent. In my experience, there are two types of estate
agents: negotiators and dealmakers.
Negotiators will waste your time and money trying to
find the “perfect” deal- for them. Even if the property is
overpriced, they will push you to buy it so they can make
the best commission. This will mean that you buy a liability
rather than an income-generating property.
Dealmakers, on the other hand, want to build relationship.
They will work with both the investor and the seller, do
thorough research to find good deals and only pick deals
that fit with the investor’s long-term vision. If a deal falls
through for any reason, a deal maker will work tirelessly to
find another better deal for the investors.
3
Buy distressed properties or
buy from distressed sellers
Some deals take longer to close than others.
However, the faster you close deals, the more money you
can make in less time. Thankfully, there is a simple way to find
these fast closing deals: buy distressed properties or buy from
distressed sellers.
Those who invest in property in South Africa use the term
“distressed property” to mean any that will be sold below
market value, such as foreclosed homes. “Distressed sellers”
are those who want to sell fast due to personal issues such as
divorce, debts, relocations, etc.
4
Focus on big deals
There are so many ways to invest in property in
South Africa. Deals range from a few hundred
thousand Rands to hundreds of millions of Rands. However,
something that I learned early on in my career as a real estate
investor is this: The amount of time spent on a big deal and the
small deal is almost the same, but the rewards are not.
This is why it’s crucial to work smart and not hard. Focus on
securing big deals to ensure that you build a strong reputation,
generate wealth and don’t waste any time.
5
Know your market
“Be Fearful when others are greedy and greedy
when others are fearful,” said Warren Buffet.
When it comes to property investment, this saying couldn’t
be truer. In order to make a profit when you invest in property
in South Africa, you need to be smart. The only way to make
sure you spot good deals, and never overpay for a property,
is by knowing your market. However, the real estate market is
constantly changing. You can’t take a real estate course once
and then expect your business to excel for the next 20 years.
Instead, you need to keep tabs on the market daily and stay
constantly learning.
Ezra Rasethe was mentored by Neale Petersen, Founder of REImag
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NOVEMBER/DECEMBER 2019 SA Real Estate Investor Magazine