The Property Investor

Economists agree that as the global recession takes hold and economic growth comes under threat, interest rates will begin to decline prompting a revival in South Africa’s property market by the beginning of 2010.Even though the sub-prime mortgage collapse in the United States sent the world economy into a liquidity crisis; South African banks were virtually unaffected and still considered to be some of the most stable in the world.Giving credit to consumers who are considered uncreditworthy puts banks in a position where they are at risk of being unable to finance debt as clients cannot pay their loans. The National Credit Act (NCA) came into effect on 1 June 2007, which has made receiving a loan from any bank more difficult than in the past.

An inflationary cycle that started in June 2006 spurred the South African Reserve Bank’s Monetary Policy Committee (MPC) to raise interest rates 10 times, or a cumulative five percent, until the repo rate was left unchanged at 12 percent in August 2008.A large number of South Africans had to sell their properties as they had exceeded their financial capacity by taking out too many bonds on existing properties and were unable to keep up with their bond payments in the wake of continually increasing interest rates.In 2009, the direction of the property market is largely defined by what is happening globally as well as politically in South Africa.With the introduction of the National Credit Act as well as high interest rates, loans became difficult to get approved and people were already financially stretched; this made buying property extremely difficult for many people in 2008.Potential buyers could no longer receive 100 percent of the value of the home as a loan because the lending criteria at banks had changed. Now, before qualifying for a loan, buyers also have to put down a deposit of between 10 and 15 percent of the value of the home.Property owners were forced to sell their properties at prices much lower than initially desired due to high interest rates. Sellers who took 5 to 10 percent off their price in the past were now having to take 20 to 30 percent off their original price.If there is a swing in the property market in 2009 and if interest rates continue to come down, consumers will be encouraged to once again invest in property.In the recent past, the property market was more of a buyers market as people were forced to accept lower offers for their properties.Experts however are finally beginning to feel positive about the notion that interest rates will come down. The market should begin to pick up from the middle of 2009 and onwards. Some economists say that even though the South African property market will be fairly weak for most of 2009, it will begin picking up as we near 2010.In the midst of global economic turmoil, South African property has been rather resilient. A decrease in interest rates is expected to pave the way for greater interest in the property market once again.

As of now, it appears that we seem to have reached the lowest point to which the property market can go, and with cuts in interest rates and salary increases, interest in the South African property market is bound to take off again.

With thousands of foreclosed properties being advertised each passing day, it is extremely important to choose well what to buy, where from who and when.  Here are a number of important things to take into consideration before you finally decide to invest on foreclosed properties:

1. Location

Location, location, location! Yes, location is the most important thing that each and everyone could first consider when buying any kind of property, and so do you when buying foreclosed properties. Location, in most cases will determine the rate of profitability for your property since it determines the selling price in the future when you decide to sell the property. Consider if the place you are going to buy the foreclosed property is a slow growing or quick growing area which can bring you benefits in the future.

Accessibility, availability of utilities and security will also be determined by the setting or rather location of your desired property. The place should be conveniently accessible to churches, hospitals, and markets, grocery stores among other necessary and basic utilities.

2. Property condition

When investing in a foreclosed property, a real property for that matter, then it is important to look for a sound investment, made of durable materials meant to last for quite a long time. It is considerably rare to find foreclosed properties in poor condition but if they need any kind of repairs then make sure that they are made.  Watch out for any termite infestations, water damages or rotting wood. You might need a contractor to check on the physical condition of the place before you make any payments.

3. Selling price

You will make money if you buy the property at a price below the market value. Make sure that you consider other costs like major taxes, because some buyers at times transfer such costs to the buyer. You’d better know this early enough just incase the buyer transfers the payments to you.

4. Seller motivations

Go for a seller who really needs to sell his property as soon as possible-a motivated seller. Banks for instance are motivated sellers though they at times sell their properties below market values. Motivated sellers offer discounts and bidding might just become an option rather than a necessity.

5. Financing

Apart from considering favorable selling prices, it is also important to consider the availability of financing that basically provide flexible payment terms and preferably low mortgage rates.

As much as you are doing a bargaining, it is far much important to consider the period to make your payments, a week for instance or cash payments might not be of help at all, you need enough time to come up with the money.

During the bargaining period, ensure that you get in terms with the interest rates and the period to pay the interest. The rates should be friendly and fair enough; not too high, not too low.

Investing in foreclosed properties can hold a great investment in your life. It can bring you great opportunities for now and for the future. Go for it, don’t waste more time.

Property Investment is growing in importance today in the global investment arena as more and more developing economies open up giving us the chance to make vast capital gains offshore. This article deals with how to buy property at a bargain so as to boost your ROI and continues from the previous article in our three part article series on how to maximise your ROI when purchasing investment property.
Most people, know the stock market adage, buy low sell high and attempt to apply it to many areas of their life. Most do not know the science of analyzing and quantifying this increase in prices and the real estate arena is no different. The best way to increase your ROI is to purchase a property when it is undervalued thus adopting Benjamin Grahams value investing model. Spend some time looking at the class of property that you wish to acquire and then focus on looking for a bargain.
Once you know what class of investment property you are in, spend some time looking at the statistical data. The more savvy investors would then perform technical analysis on the real estate purchasing and rental data to generate a graph. Note that there is no need to do this yourself and most real estate brokers that have investment property divisions, can generate the graphs for you. Spend some time asking why the rental is increasing and ascertain the risk factors to the rental market for your particular class of investment property.
The whole purpose of this mathematical analysis before you actually go down and “fall in love with the property” is to adopt a dissociated mindset and be a real estate fund manager mindset. This allows you to screen out loss making properties before you even get pressured by the real estate agents or potential sellers to purchase or take a look at their properties. Thus you should imagine your role is as one of acquiring property investment bargains which meet your mathematical investment criteria and which pass your physical inspection.
In conclusion, property investing like most other forms of investment, the money is made when buying the property. Spend some time figuring out what your property investment objectives are and focus on achieving them. This is a three part series and we will continue in the next article on buying a property in a hot rental area and boosting your property investment ROI.

The Costa Blanca region in Spain is one of the most desirable destinations choices for holiday travel. The name Costa Blanca literally means “the white coast” with its coastline situated on the Mediterranean Sea. Its beautiful coastline, natural environment, rich culture and fabulous weather have turned the Costa Blanca region into a popular tourist destination. Accordingly, investing in Costa Blanca property not only gives you the option of a permanent vacation home but great income potential.
Not surprisingly, real estate along the coastline is generally in greater demand than property inland. However, there is also a tremendous demand for properties in the northern, mountainous areas such as Denia and Altea. The most sought after properties in the southern part of the Costa Blanca are Alicante and Torrevieja, two of the most popular vacation destinations on Spain’s coastline. Besides the property’s geographic location, amenities such as a pool and nearby attractions also add to property demand in certain areas. Benidorm, for example, has a theme park and water park while Torrevieja has a beautiful natural park. These attractions, in particular, are desirable for those with families.
Not sure how to find property around Costa Blanca? The two best options to begin your search are researching available property listings online and contacting a local real estate agent in the desired area. Contacting a local real estate agent may be the best way to start, especially if you have not yet decided on your desired location. The agents know the area and can advise you on the neighborhoods, surrounding cities, amenities and other useful information you may not find with only an internet search.
Real estate prices in Spain have risen to record highs in the past few years and the Costa Blanca region is no exception. This may be a good time to look for property, though, since there is some indication that the market is beginning to drop. There are several reasons for the increased real estate activity in this region of Spain, including low-interest rates, rising incomes and foreign interest in the area. Naturally, these factors influence the price of property, but you will generally find that inland properties are less expensive than the beachfront properties. Inland properties also offer more land and oftentimes include fruit trees or orchards. Of course, the beach is still within a reasonable drive.
Renting the property is a great way to utilize your investment while you are not using it. The rental income can help the property, basically, pay for itself while simultaneously providing you with a permanent vacation property. The highest price paid for rental properties is during the summer when tourism is at its peak. If you plan to use the home during the summer, you still have the option of renting it during the off season. Due to the area’s mild winters and general favorable climate, retired people sometimes spend their winters in this region and may need a rental property for six months or even more during this time.

With the Dubai property market recording high levels of growth and returns, also given Dubai’s reputation to stand out from the crowd, there isn’t a better time for these two features to be combined, this is exactly what Dubai’s hottest new portal propertyportal.ae aims to accomplish. This new and exciting project www.propertyportal.ae, offers a different kind of service to realtors, private sellers and potential investors in Dubai real estate and best of all, it’s free.

With so many Real Estate websites pertaining to the UAE that offer the same standard service to visitors, propertyportal.ae features listings of all the leading freehold developments in Dubai in an easy to use format, as well as a travel hub to book flights and hotels to the Country. All the information you need about buying and selling property, as well as life in Dubai is on hand in a one-stop-shop.

Mark Wallington, Managing Director for propertyportal.ae said he is certain that the Dubai Real Estate market needs a new angle and is confident that this new portal can create a niche for itself. “There are currently a large number of generic real estate websites available in the UAE and specifically Dubai. We are aware of this fact, and therefore set out to create a portal that takes the positive aspects of what’s available in the Dubai property market and go one step better. There are many factors to consider when designing a portal to promote your business or product. Not least of these is having a user friendly website where your customers can find the information they need or view your properties with ease, no useless animated intro’s or lack of information, we keep things as simple as we can so that our users can quickly and easily access the information on properties that interest them.”

Wallington also said that they have received a good response to the website already. “During our ‘soft’ launch we had over 300 property agent’s sign up and over 700 properties listed. This brilliant response goes to show that the Dubai Real Estate market is looking for a different class of property website to get their properties in the “shop window” he said. “Leading developments like the Burj Dubai and the Palm Jumeirah are really creating attention for the City as a business and tourism destination. Dubai has previously been recognised for being home to the world’s richest horse race, the Dubai shopping festival and the Rugby Sevens, but now it is property that attracts overseas interest the most.”

An important aspect of the properyportal.ae is that both real estate agents and private sellers can place their property listings onto the website free of charge. The website is updated frequently and the best properties available on the market are regularly featured in the ‘Hot Properties’ section of the portal. Visitors are encouraged to get in contact with the company or agents who list them and can expect a swift response to any further enquiries they may have.

Laura Bentley, a marketing executive for the portal went on to say: “The website has been designed to help investors, sellers and buyers unite to check the latest properties on the market as easily as possible. The key feature of this site is to allow agents and private owners to list their properties at no cost but to get the best possible exposure.”

As the completion of more and more projects approaches, propertyportal.ae might just provide a solution to the difficulties that buyers and sellers in Dubai face from the many websites that just don’t offer an entire range of property services in this expanding sector