Did you know that a car instalment of R3600 and Car Insurance of R1300 is a bond repayment of +/- R4900 on a R500 000 investment property that can bring you cashflow? Did you know you can buy another one after your first one?
Some may naively ask me: “Will I drive my property to work?”. I will respond; if you start with the property, it will be much easier to get the car. It takes 30 minutes to finance a car but a week and more to finance a property. However the benefits of owning investment property are more than that of a car! Besides, there are good cars that you can buy cash for R50 000 and less.
If you are a first time home buyer you don’t necessarily have to have a deposit, or money saved up for attorney fees in order for you to buy your first property. Purchase a property in a new development. Banks are always eager to fund 100 percent of the transaction if it is your first time buying property, and especially if the property is in a new development.
The developer will usually cover all the attorney fees (bond and transfer costs), and you will technically get the property for free. You can live in it for a few months then rent it out and buy another one. This is how we bought one of our properties when we started out – it was actually our 3rd property that year – no deposit, no attorney fees. We later moved on and rented the property out to someone else.
I’ve heard masters of the game, including my mentors say “Don’t wait to get into property, get into property and wait.” Now, after years, it makes sense: the longer you wait the more money you’ll have to pay later.As you grow older, property prices will continue to increase. The good news about 2020 though, is that the property prices are falling everywhere. Those who afford to buy are taking advantage of lower interest rates and falling property prices. I wish you success.