Our current market for this portfolio is South Africa. Looking for safe investments, and property remains one of the safest ways to grow money. The biggest group of homebuyers are millennials; in fact, buyers who are 36 years old and younger continue to purchase homes at a higher rate than other age groups The largest interest is for houses below the USD30000/ R400 000 price mark.
Before we commit to buying property, we to calculate the potential yield on the property. We, find out the yield of other rental properties in the same area to avoid paying an unfair price for the property. Doing sufficient research can mean the difference between having a sound investment and a botched venture.
In line with the investment opportunity, the Fund’s objective is to identify and build an attractive portfolio of investments in the targeted sectors and make successful exits to create value for its investors over its life span. The realisation of this objective will rest upon the Fund’s investment philosophy which will guide the Manager’s investment process at all times.
Capital Appreciation – The Fund intends to create value for investors through participating in projects with high capital appreciation potential. This objective is in line with the long-term investment tenure.
Dividend Yield – The Fund’s strategy of ‘Buy-Build-and-Let Out’ is intended to generate above average investment returns which will be made up of periodic rental income distributions and asset value appreciation.
Strategies that we apply include the following:
- Buy and hold (and refinance every few years)
- Buy and ‘flip’ (quickly reselling it) in the same market
- Buy, renovate and sell
- Rent-to-Buy (option to buy on contract in the longer term)
- Alienation of land act (property is transferred into the buyer’s name at a later date)
- On selling contracts (vendor finance where there are deferred loans on the property)