03 Jan 2013
With interest rates at 40-year lows and stock markets so volatile, it’s difficult for individual investors to achieve a return on their money that’s even equal to inflation.
This is probably the main reason why the interest in buy-to-let property investments has been increasing again over the past year, or so says Berry Everitt, MD of the Chas Everitt International property group, noting that there are other good reasons for investors to choose bricks and mortar just now.
Low interest rates make it easier to afford a second property and more likely that the rent will cover any bond repayments, especially if you can buy with a sizeable deposit, he says.
A difficulty many households are having is obtaining a home loan, because their credit records are impaired or their debt is too high which means that rental demand is high.
Everitt says the slow rate of delivery of new housing developments in the affordable range suggests rentals will hold up well for the next few years.
However, if you’re keen to buy an investment property, you must remember to apply the same “rules” about location, condition and security as when buying a home for yourself, he says.
“Price is important, of course, but cheap is very seldom best.”
Finding the right property, with reliable, creditworthy tenants should never be left to luck. Everitt advises buy-to-let investors to seek out an experienced, reputable estate agent to help them evaluate the soundness of any proposed property investment, and to help find prospective tenants.
Then once there are tenants in residence, Everitt says you need to be certain that the property is well cared-for and maintained and that the rent is paid on time. This is where appointing a specialist to manage the investment makes good sense.
“Few investors are prepared or able to be full-time landlords and this responsibility is best delegated to an experienced, well-briefed estate agent based in the vicinity of the property," he says.
An agent will be able to deal objectively with tenants who don’t pay or who damage the property and should also have an established network of competent contractors to carry out necessary maintenance and repairs.
An agent who specialises in managing rental properties will make sure the investor receives professional advice on the host of laws and regulations that govern landlord-tenant relationships, and on the demands of local government regulations.
House for sale in Vermont R 1 195 000
Apartment / Flat for sale in Wolmer R 400 000
House for sale in Groenkloof R 2 550 000
Apartment / Flat for sale in Florauna R 850 000
House for sale in Theresapark R 750 000
Townhouse for sale in Ninapark R 730 000
House for sale in Theresapark R 799 000
House for sale in Theresapark R 1 190 000
House for sale in Shelly Beach R 1 950 000
House for sale in Shelly Beach R 1 850 000
If you are using Internet Explorer 8 or higher, please verify that your Internet Explorer compatibility view settings are not enabled.
For the best browsing experience, update to the latest Version of Internet Explorer or try out Google Chrome or Mozilla Firefox.
Please contact our Property24 Support Team for further assistance. Tel. +27 (0)861 111 724