Best forms of investment in South Africa today

Posted On Monday, 03 February 2014 12:56 Published by eProp Commercial Property News
Rate this item
(1 Vote)

Residential rental returns and capital growth are by no means uniform in south africa – and investors should realise this.

Bill Rawson






Those whose job it is to encourage investors to take the plunge and move into buy-to-let property inevitably have to rely heavily on property analyst statements covering the property sector's achieved and anticipated returns, particularly from those compiled by South Africa's major banks. However, these can be misleading, says Bill Rawson, Chairman of the Rawson Property Group.

"Most of us propagating the advantages of this type of investment," says Rawson, "are selling units in the high demand, central metropolitan areas, for example, Cape Town's central Southern Suburbs, Durban's Umhlanga and Berea and most of Sandton in Johannesburg. Buy-to-let investors will often get a 7 to 8% return from day one in these areas and in select markets can look forward to a 9 to 12% annual appreciation. At Rawson Developers' recently completed multi-unit project "The Rondebosch", certain investors have sold out at a 30% profit within three months of the scheme's completion."

"Those who consult statistics will, however, shoot down such figures as these, quoting national figures of 5 to 6% returns on rented property and a capital appreciation of 7 to 8%. It has, however, to be realised that these figures do not apply to the central metropolitan precincts, where, as I have indicated, the returns are excellent today and high demand and an increasing shortage of space is making them better month-by-month."

"I remain convinced and I continue to say that this is one of the soundest and best forms of investment in South Africa today and the waters should not be muddied by quoting figures which relate to South Africa as a whole rather than the areas in which the major developments and the major renting action are taking place," says Rawson.

Last modified on Friday, 14 March 2014 08:57

Most Popular

Balwin's Munyaka registers record R850 million in opening weekend sales, selling 555 apartments

Mar 09, 2020
JSE listed Balwin Properties, a developer that cares about environmentally responsible…

Balwin Properties and ABSA launch South Africa’s first green home loan

Mar 13, 2020
Apartment 71933
JSE-listed Balwin Properties Limited (Balwin Properties or the Company) and Absa Group…

Growthpoint reports a steady first half with its growth strategies paying dividends

Mar 11, 2020
Growthpoint Properties Group CEO Norbert Sassee
Growthpoint Properties (JSE: GRT) reported distributable income growth of 2.2% to R3.2bn,…

Spear REIT launches innovative self-isolation campaign for returning travellers in Cape Town, South Africa to combat COVID-19:

Mar 18, 2020
Double Tree Op
JSE listed Spear REIT Limited, the owner of the Double Tree by Hilton Cape Town, is the…

Financial Fitness – Is this the right time to buy property?

Mar 20, 2020
Governor Lesetja Kganyago SARB1
With the South African Reserve Bank’s announcement of interest rates cut of 100 basis…

Please publish modules in offcanvas position.