This week I answer a question from Stephan Almeida he ask: How do we update the tax tables in the Property Pro Investment Program?
http://youtube.com/watch?v=wX-Rrs91FYI
Other "property investment training" videos
http://youtube.com/watch?v=VEFPALrIasg
http://youtube.com/watch?v=qauVO0TVMGc
Tuesday, February 26, 2008
Wednesday, February 20, 2008
Property Investment: Question relating to the New Credit Act
This week I answer a question from Otto Gouws he ask:
"It seems that the new Credit act is making it more difficult for the average man, with an existing bond, to apply for finance. How can one get around this obstacle and get a bond/loan on investment property?"
You will find the answer on http://youtube.com/watch?v=VEFPALrIasg
You can also have a look at http://propertyschool.blogspot.com/2007/08/did-you-get-it.html
Hope you learn something
"It seems that the new Credit act is making it more difficult for the average man, with an existing bond, to apply for finance. How can one get around this obstacle and get a bond/loan on investment property?"
You will find the answer on http://youtube.com/watch?v=VEFPALrIasg
You can also have a look at http://propertyschool.blogspot.com/2007/08/did-you-get-it.html
Hope you learn something
Friday, February 15, 2008
Property investment - is now the time to buy or sell?
I am getting more and more propositions to buy "investment properties". The question I ask the people who offer these properties to me is, “Give me the bottom line. What is the risk and what is the IRR over a five year period based on the Property Pro Investment Program?”.
What is really interesting is that as of today, NOT ONE seller or agent has come back to me! I am seriously in the market. I want to buy. I can’t wait to buy. But I buy only real investments. I want to know the bottom line and I do not fall for sales talk. All I need is the figures. And I am not getting them!
The question is: “How do you know whether or not a property is really an investment and not a dud?”
Here is the interesting thing. For the past seven years I have taught my students how to use and apply the Property Pro Investment Software Program to determine the REAL risk and potential growth in any property. Over the past seven years I have also warned them of the pitfalls, saying that unless you know how to determine the risk and potential growth you should stay out of the property market.
Property can be either one of the best investments you can make or one of the worst. The only way to know for sure is to do the calculations. There is no other way.
Most people have no idea that one should do the calculations ... or what calculations are relevant. I tell my students that there are 27 variables – at least – to consider. Unless you have a proven system, you are in the dark. Simple.
I have such a system. I developed it myself, based on my experience of creating great wealth with property. I believe it is quite unique. And I can use it to prove to anyone that unless you use a program like the Property Pro Investment Program it is impossible to make an informed financial decision.
Location, location, location ...
If everyone says something you should be suspicious of it. In my experience it is a lie that misleads people and makes it easier to fleece them. And what “everyone” (mostly salespeople) says about property is that it is the location, location, location that is important. This is a lot of nonsense, simply because there are twenty seven variables when it comes to property and location is not the most important. Unless you understand how it works you cannot make a decision. But if you are conditioned to think “location, location, location” then what are you going to do? You are going to try and buy the most expensive property you can. And that translates into a nice fat commission for the agent.
The only thing that is truly important is to know what your risk and your return on my investment are. Unless you can calculate and manage that, my advice is to STAY OUT OF THE PROPERTY MARKET.
I have made a short training video to demonstrate to you that the growth on the location has almost no influence on the growth you are going to get on your investment. In this training session I start with the basics - basically to prove to you the accuracy of the Property Pro Investment Program and that there is very little relation between the growth of the location and the growth you are going to get on your money, or your investment.
Now to answer the question - is now the time to buy or sell?
The answer is easy. Do the calculation. If you follow the Property The Road To Riches DVD Course I will teach you in less than a day how to evaluate a property, how to determine the risk and how to decide if you should buy or sell a property.
Till the end of this month we have a special on our Property Executive course - to find out more call Lio or Kleintjie in Pretoria (012) 542 4560 or e-mail lilo@propertyschool.co.za
What is really interesting is that as of today, NOT ONE seller or agent has come back to me! I am seriously in the market. I want to buy. I can’t wait to buy. But I buy only real investments. I want to know the bottom line and I do not fall for sales talk. All I need is the figures. And I am not getting them!
The question is: “How do you know whether or not a property is really an investment and not a dud?”
Here is the interesting thing. For the past seven years I have taught my students how to use and apply the Property Pro Investment Software Program to determine the REAL risk and potential growth in any property. Over the past seven years I have also warned them of the pitfalls, saying that unless you know how to determine the risk and potential growth you should stay out of the property market.
Property can be either one of the best investments you can make or one of the worst. The only way to know for sure is to do the calculations. There is no other way.
Most people have no idea that one should do the calculations ... or what calculations are relevant. I tell my students that there are 27 variables – at least – to consider. Unless you have a proven system, you are in the dark. Simple.
I have such a system. I developed it myself, based on my experience of creating great wealth with property. I believe it is quite unique. And I can use it to prove to anyone that unless you use a program like the Property Pro Investment Program it is impossible to make an informed financial decision.
Location, location, location ...
If everyone says something you should be suspicious of it. In my experience it is a lie that misleads people and makes it easier to fleece them. And what “everyone” (mostly salespeople) says about property is that it is the location, location, location that is important. This is a lot of nonsense, simply because there are twenty seven variables when it comes to property and location is not the most important. Unless you understand how it works you cannot make a decision. But if you are conditioned to think “location, location, location” then what are you going to do? You are going to try and buy the most expensive property you can. And that translates into a nice fat commission for the agent.
The only thing that is truly important is to know what your risk and your return on my investment are. Unless you can calculate and manage that, my advice is to STAY OUT OF THE PROPERTY MARKET.
I have made a short training video to demonstrate to you that the growth on the location has almost no influence on the growth you are going to get on your investment. In this training session I start with the basics - basically to prove to you the accuracy of the Property Pro Investment Program and that there is very little relation between the growth of the location and the growth you are going to get on your money, or your investment.
Now to answer the question - is now the time to buy or sell?
The answer is easy. Do the calculation. If you follow the Property The Road To Riches DVD Course I will teach you in less than a day how to evaluate a property, how to determine the risk and how to decide if you should buy or sell a property.
Till the end of this month we have a special on our Property Executive course - to find out more call Lio or Kleintjie in Pretoria (012) 542 4560 or e-mail lilo@propertyschool.co.za
Friday, September 14, 2007
The Formula For Riches and Property by Gletwyn Rubidge and Chevonne Bishop
Application of the Formula for Riches:
Here is our story of how my wife and I purchased two properties and how we applied the formula for wealth to make them efficient investments.
There are two parts to this story:
Part A
In July 2003 my wife and I bought a house on auction for R225k:
Costs 30 k include transfer, auctioneers commission etc. the rest was covered by a bank loan. We decided not to put down a deposit so as to preserve capital. The 30 k was take from our access bond of our home, this borrowed money actually cost us R 300 per month to pay back to the bond. We saw this as reduced risk in that property is fairly safe as an investment and by using the 30 k from the bond we were basically paying R300 back per month for the use of the capital.
We loaned 40 k from the bank to make a few alterations that would help boost the rent to make the purchase more efficient. The alterations included converting a garage and outside room to a flatlet. This would, we reasoned, give a positive cashflow for the property.
We tenanted the house in September covering all monthly costs including the bond repayment and making a positive cash flow of R740* every month. These tenants were carefully screened by us to reduce risk of nonpayment. They paid on time and did not move making our life simple.
*If we include the cost of the capital borrowed from our own access bond then the house was making R440 per month. Basically we were being paid R440 per month to own the house. The only real cost was the time and effort required to get this project done.
We put a security fence up at the end of the second year - cost of about R6500 which neutralized our rental profits for that year.
After 3 years we received an offer of 980k for the place.
I calculated the growth by internal rate of return(IRR) and capital growth:
For the sake of calculating IRR I used an expense of R500 and came up with 22860% - a stunning twenty two thousand eight hundred and sixty per cent. The smaller the figure of you capital the higher our IRR goes.
Calculating the capital growth on the capital we used over three years (and those were very good years of capital growth for property), as well as the growth per year:
We subtract the amount owed to the bank from the amount offered to us for the property and divide by the capital used to cover costs – nb no deposit.
100% x (980-265)/30 = 2383% over 3 yrs; and average 794% over each year.
These values are a little better than the banks offer. The best growth I ever had in a paper asset was 14 %! Our was 56.7 times better!!!
We would still have to pay capital gains tax on the profit, if we sold.
Anyway, we decided not to sell and kept the property - the offer of 980 k was from a developer. We are now negotiating a deal where the developer plans to develop our property with another 8 neighbouring houses. We now stand to receive three very up-market units in exchange, and our rental loss is covered by the developers during the development period. So we could have had the 794% growth, but rather opted to increase our capital growth by another 40-60% by getting three units as well as increase our rental income by about 40%.
As you can imagine there are now a number of possible options:
Sell and have plenty of cash to do up our own house, buy a car, go on holiday, reinvest in other properties, or as we plan to just grow the investment further. The latter option will be very economical on time as we are not involved in the work part of the development.
So the bottom line is that our time and effort were extremely efficient “work”.
Part B
The actual growth depicted above may be a bit more when you consider that we took our first years profits R440 per month) and went house hunting to a somewhat degraded area of town where bargains that pay for themselves could still be had.
An estate agent showed us a house and after doing our calculations we could not cover our costs on the one we viewed so we told him it was not suitable and asked what else he had. He said: “There is another one, but it is a really bad one.”
“Show us now!” we smelled opportunity.
We got there and found a real horrific mess of a house, put in a low, risk reducing offer of 53k and it was accepted. We loaned 40 k from the bank, did up the little place(adding value hence dropping risk) and put in a tenant that not only covered the bond but also made a neat little net profit of R540 per month. So for a low risk we got paid. It presently makes about R650 per month and has increased in value to R350k in three years. All it cost us to create this monthly profit (and capital gain of: 350 – (53+40+5) = 252k) was the ~5k used to get the place in our name and the bond registered.
Our net growth from a capital gains point (growth on our capital used) of view was 100*(252/5) = 5040% over three years = 1680% per annum. We love the leverage.
In actual fact we did not really pay 5k of our capital because we used the rental profit from the first property (R440 per month for five months = R2200) to fund some of the 5k of capital.
So recalculating:
100*[252/(5-2.2)] = 9000% for 3 years, this equals 3000% capital growth per annum for each of the three years.
As a matter of interest if we paid the 40 k out of our pocket the growth would have dropped to 196% still good but a far cry from the 3000% we obtained.
If we paid cash for everything the yield would be 88 % per year.
The internal rate of return was 8516%. Again, a splendid growth due to the slender use of capital.
Let’s say we worked hard protecting the sacred capital and only spent R5 then the IRR would be 4813538%. OK, too many numbers: 4.8 million percent.
Re-applying these principles to other properties similar to these could lead to a snowball effect of wealth creation.
In summary, we used:
little capital,
low risk,
leverage of the banks money,
leverage of what the properties offered beyond their initial appearances,
personal control of our asset
You won’t know if you don’t try!
Gletwyn Rubidge and Chevonne Bishop (Bishop and Rubidge Properties)
Here is our story of how my wife and I purchased two properties and how we applied the formula for wealth to make them efficient investments.
There are two parts to this story:
Part A
In July 2003 my wife and I bought a house on auction for R225k:
Costs 30 k include transfer, auctioneers commission etc. the rest was covered by a bank loan. We decided not to put down a deposit so as to preserve capital. The 30 k was take from our access bond of our home, this borrowed money actually cost us R 300 per month to pay back to the bond. We saw this as reduced risk in that property is fairly safe as an investment and by using the 30 k from the bond we were basically paying R300 back per month for the use of the capital.
We loaned 40 k from the bank to make a few alterations that would help boost the rent to make the purchase more efficient. The alterations included converting a garage and outside room to a flatlet. This would, we reasoned, give a positive cashflow for the property.
We tenanted the house in September covering all monthly costs including the bond repayment and making a positive cash flow of R740* every month. These tenants were carefully screened by us to reduce risk of nonpayment. They paid on time and did not move making our life simple.
*If we include the cost of the capital borrowed from our own access bond then the house was making R440 per month. Basically we were being paid R440 per month to own the house. The only real cost was the time and effort required to get this project done.
We put a security fence up at the end of the second year - cost of about R6500 which neutralized our rental profits for that year.
After 3 years we received an offer of 980k for the place.
I calculated the growth by internal rate of return(IRR) and capital growth:
For the sake of calculating IRR I used an expense of R500 and came up with 22860% - a stunning twenty two thousand eight hundred and sixty per cent. The smaller the figure of you capital the higher our IRR goes.
Calculating the capital growth on the capital we used over three years (and those were very good years of capital growth for property), as well as the growth per year:
We subtract the amount owed to the bank from the amount offered to us for the property and divide by the capital used to cover costs – nb no deposit.
100% x (980-265)/30 = 2383% over 3 yrs; and average 794% over each year.
These values are a little better than the banks offer. The best growth I ever had in a paper asset was 14 %! Our was 56.7 times better!!!
We would still have to pay capital gains tax on the profit, if we sold.
Anyway, we decided not to sell and kept the property - the offer of 980 k was from a developer. We are now negotiating a deal where the developer plans to develop our property with another 8 neighbouring houses. We now stand to receive three very up-market units in exchange, and our rental loss is covered by the developers during the development period. So we could have had the 794% growth, but rather opted to increase our capital growth by another 40-60% by getting three units as well as increase our rental income by about 40%.
As you can imagine there are now a number of possible options:
Sell and have plenty of cash to do up our own house, buy a car, go on holiday, reinvest in other properties, or as we plan to just grow the investment further. The latter option will be very economical on time as we are not involved in the work part of the development.
So the bottom line is that our time and effort were extremely efficient “work”.
Part B
The actual growth depicted above may be a bit more when you consider that we took our first years profits R440 per month) and went house hunting to a somewhat degraded area of town where bargains that pay for themselves could still be had.
An estate agent showed us a house and after doing our calculations we could not cover our costs on the one we viewed so we told him it was not suitable and asked what else he had. He said: “There is another one, but it is a really bad one.”
“Show us now!” we smelled opportunity.
We got there and found a real horrific mess of a house, put in a low, risk reducing offer of 53k and it was accepted. We loaned 40 k from the bank, did up the little place(adding value hence dropping risk) and put in a tenant that not only covered the bond but also made a neat little net profit of R540 per month. So for a low risk we got paid. It presently makes about R650 per month and has increased in value to R350k in three years. All it cost us to create this monthly profit (and capital gain of: 350 – (53+40+5) = 252k) was the ~5k used to get the place in our name and the bond registered.
Our net growth from a capital gains point (growth on our capital used) of view was 100*(252/5) = 5040% over three years = 1680% per annum. We love the leverage.
In actual fact we did not really pay 5k of our capital because we used the rental profit from the first property (R440 per month for five months = R2200) to fund some of the 5k of capital.
So recalculating:
100*[252/(5-2.2)] = 9000% for 3 years, this equals 3000% capital growth per annum for each of the three years.
As a matter of interest if we paid the 40 k out of our pocket the growth would have dropped to 196% still good but a far cry from the 3000% we obtained.
If we paid cash for everything the yield would be 88 % per year.
The internal rate of return was 8516%. Again, a splendid growth due to the slender use of capital.
Let’s say we worked hard protecting the sacred capital and only spent R5 then the IRR would be 4813538%. OK, too many numbers: 4.8 million percent.
Re-applying these principles to other properties similar to these could lead to a snowball effect of wealth creation.
In summary, we used:
little capital,
low risk,
leverage of the banks money,
leverage of what the properties offered beyond their initial appearances,
personal control of our asset
You won’t know if you don’t try!
Gletwyn Rubidge and Chevonne Bishop (Bishop and Rubidge Properties)
Thursday, August 23, 2007
Against the crowd ... Warren Buffet
Warren Buffet has made his mega-billions by not doing what the crowd does. How many people do you know who would:
Sit on a massive pile of cash rather than invest in anything that does not deliver the right kind of growth and value, as he did in 2001 – to the tune of 50 billion dollars?
Then, in a matter of months, spend the lot and buy companies because the time was right?
Which meant, everyone else thought the time was WRONG (i.e. post-September 11th)
Watch a single company for fifteen years before investing a cent ...content to wait until the economy, the government or the management made some change that brought a window of opportunity for fabulous value?
* It takes strength of character to resist the hysteria of a boom or the panic of a bust and go in the opposite direction to everyone else.
* It takes strength of character to ignore what the “experts” are saying and make decisions according to your own simple but powerful rules (for example, the Formula for Riches).
* It takes strength of character to resist being swept along while you sit tight and listen as everyone tells you you’re missing out.
But that’s how the second richest man in the world did it. And you can too.
In 1982 I bought my first property as an investment.
In 1987 I bought my second.
I waited five years for the climate to be right for me again. It so happened that in the intervening years the market wasn’t great.
Could you wait fifteen years for the right thing? Could you wait five?
And does it matter?
Yes, it does. Rushing a decision because you’re in a panic about being too slow, missing out, or being too close to retirement doesn’t make it okay.
Five properties with an IRR of 20% are not equal to one property with an IRR of 100%.
Two wrongs do not make a right and two mediocres do not make a brilliant.
Scoring 50% in two exams does not give you 100%.
We may laugh at the idea but we think property or other investments are different! They’re not.
Sit on a massive pile of cash rather than invest in anything that does not deliver the right kind of growth and value, as he did in 2001 – to the tune of 50 billion dollars?
Then, in a matter of months, spend the lot and buy companies because the time was right?
Which meant, everyone else thought the time was WRONG (i.e. post-September 11th)
Watch a single company for fifteen years before investing a cent ...content to wait until the economy, the government or the management made some change that brought a window of opportunity for fabulous value?
* It takes strength of character to resist the hysteria of a boom or the panic of a bust and go in the opposite direction to everyone else.
* It takes strength of character to ignore what the “experts” are saying and make decisions according to your own simple but powerful rules (for example, the Formula for Riches).
* It takes strength of character to resist being swept along while you sit tight and listen as everyone tells you you’re missing out.
But that’s how the second richest man in the world did it. And you can too.
In 1982 I bought my first property as an investment.
In 1987 I bought my second.
I waited five years for the climate to be right for me again. It so happened that in the intervening years the market wasn’t great.
Could you wait fifteen years for the right thing? Could you wait five?
And does it matter?
Yes, it does. Rushing a decision because you’re in a panic about being too slow, missing out, or being too close to retirement doesn’t make it okay.
Five properties with an IRR of 20% are not equal to one property with an IRR of 100%.
Two wrongs do not make a right and two mediocres do not make a brilliant.
Scoring 50% in two exams does not give you 100%.
We may laugh at the idea but we think property or other investments are different! They’re not.
Did you get it?
I sometimes get asked about the National Credit Act and how one can “get around it”. For some reason, people have got stuck on the idea that spending 30% of your gross household income on home loan repayments is a limitation that is going to hold them back on Wealth Creation.
When I ask why this is a problem for them, they say ...
“I am up to my limit already with my family home and my place at the coast, so that means I cannot invest in property for Wealth Creation.”
Then I ask them what IRR they are getting on their existing properties and they tell me that they have not done the sums.
This really surprises me!
How can you just leave these two big purchases, these two big risks, out of the equation when it comes to planning your financial future? If 30% of your income is not working its head off in terms of your Wealth Creation goals, how can you ignore that?
You see, a lot of people just do not “get it”.
I understand that they may have bought their properties before they learned how to invest in property like a Wealth Creator. Back in the days when, like most people, they bought up to their maximum in terms of affordable bond repayments (or more accurately, up to the maximum of what the bank would lend them) when it came to a family home, and then bought a dream holiday home at the coast too, when they could.
(As an aside, have you noticed how many more people have bought homes on the coast? Not long ago it was really something only the very well-to-do did. Now people on quite ordinary incomes are doing it too! Not that prices have gone down – far from it!)
Back to the story ...
If the 30% of your income that’s going into your home loan/s is not growing at a good rate, you have a problem. Nearly a third of your income is “out of the race”. Just the decision to pick up that little place on the coast has taken thousands of Rands a month off the table of your financial future. There is something called an opportunity cost and if, say, R5 000 a month is earning you say 20%, then in 10 years time you will have put in R600 000, for what kind of return?
R1, 880 476.50
If you think that’s not too bad then you must have been talking to a life insurance salesman sometime recently! Because take a look at this:
If you invest a tenth of this, R500 a month, at the rate of 85%, you will put in R60 000 and get what kind of return?
R26, 015 986.
It’s not a mistake. R500 a month can make you over R24 million MORE than R5000 a month, if you put in the time and effort to find the right property, structure the right deal, and check that you are getting the right kind of answers when you run Property Pro Investment Program.
When I ask why this is a problem for them, they say ...
“I am up to my limit already with my family home and my place at the coast, so that means I cannot invest in property for Wealth Creation.”
Then I ask them what IRR they are getting on their existing properties and they tell me that they have not done the sums.
This really surprises me!
How can you just leave these two big purchases, these two big risks, out of the equation when it comes to planning your financial future? If 30% of your income is not working its head off in terms of your Wealth Creation goals, how can you ignore that?
You see, a lot of people just do not “get it”.
I understand that they may have bought their properties before they learned how to invest in property like a Wealth Creator. Back in the days when, like most people, they bought up to their maximum in terms of affordable bond repayments (or more accurately, up to the maximum of what the bank would lend them) when it came to a family home, and then bought a dream holiday home at the coast too, when they could.
(As an aside, have you noticed how many more people have bought homes on the coast? Not long ago it was really something only the very well-to-do did. Now people on quite ordinary incomes are doing it too! Not that prices have gone down – far from it!)
Back to the story ...
If the 30% of your income that’s going into your home loan/s is not growing at a good rate, you have a problem. Nearly a third of your income is “out of the race”. Just the decision to pick up that little place on the coast has taken thousands of Rands a month off the table of your financial future. There is something called an opportunity cost and if, say, R5 000 a month is earning you say 20%, then in 10 years time you will have put in R600 000, for what kind of return?
R1, 880 476.50
If you think that’s not too bad then you must have been talking to a life insurance salesman sometime recently! Because take a look at this:
If you invest a tenth of this, R500 a month, at the rate of 85%, you will put in R60 000 and get what kind of return?
R26, 015 986.
It’s not a mistake. R500 a month can make you over R24 million MORE than R5000 a month, if you put in the time and effort to find the right property, structure the right deal, and check that you are getting the right kind of answers when you run Property Pro Investment Program.
Yes, it takes time and effort but it’s worth it.
In the meantime what do you do if you already have that beach house and an overly-expensive family home? Because we know that in an ideal world you do not try and make a bad investment better after buying it.
You make your money when you buy, not when you sell. But the reality is, many people are in this situation before they learn about property investment.
First and foremost, understand that your existing properties and investments are part of your Wealth Creation picture – they are not a separate issue. If you “get” just this, believe me you have made a breakthrough!
- Find out where you stand – work out the IRR on all your properties.
- See if you can improve the results – e.g. what would happen if you were to convert the garage into a cottage and rent it out?
- If the figures are horrible, do the sums and see what would happen if you moved into a cheaper rented place and rented out your house. (There is also a myth that it is always better to buy than to rent – do you know that?)
- Is there a market to rent out your coastal place and if so does it make financial sense to do this?
- Consider selling, especially if you could not handle another interest rate increase. It is better to sell and to carry on with your life and learn how to make the right investments than to clinch to your emotional decision – and lose it all.
- The bottom line – you cannot make a decision unless you know how to do the calculations. We make irrational decision because we are ignorant.
These ideas are just for you to investigate with Property Pro. Depending on the figures, you should make your decisions.
Thursday, August 16, 2007
Where to find property BARGAINS and MOTIVATED SELLERS?
The only place in South Africa where you can find a concentrated pool of motivated sellers and bargains is at www.propertyinvestments.co.za.
One of the biggest misconceptions about property investment is that the most critical part is the property itself - its condition and location.
The truth is that both of these considerations are secondary to the motivation of the seller.
If the seller is not motivated, then no matter what the condition or the location of the property, you are not going to get a great deal. But if you have a motivated seller, then you have a great chance of turning a handsome profit no matter what the condition or location.
When this really hits home, it revolutionizes how you prioritize your search for great deals.
No longer do you waste time doing due diligence and inspecting the house, until you have made sure you've found a motivated seller.
Once you found a motivated seller you can apply the Property Pro Investment Strategy and Program to verify if the property meets your investment objectives.
Finding Motivated Sellers.
Finding this motivated seller becomes the most important investment activity you can ever engage in.
You must focus your time, efforts, and creativity on searching for a motivated seller first.
Personal Example.
I use this strategy and during a challenge I bought 48 properties in 94 days looking at only 8 of the properties.
What signals must you look for?
In most cases motivated sellers are the result of some personal situation, unique to that individual.
Although the specific situation may be unique to that individual, there are certain patterns to look out for and then work out how to benefit from these.
By concentrating your efforts on these highly motivated sellers you will make life much easier for yourself.
Let's look at one of the patterns.
People run into financial difficulties. People get behind in payments, cannot get out of debt, find themselves threatened by outside factors such as an uncontrolled bond-rate, lose their jobs or become one of the 84% of new business owners that will close their doors within the first three years of operation.
Usually their property was used as their security to start their business.
There are many reasons for financial difficulties, but most people revert to selling their biggest asset, their house, when times get tough.
The bad thing is that if they cannot pay their debts then they can be sequestrated.
Not only have they lost every thing financially but they will also end up with a bad credit record and over the next five years they are out of the financial race.
Most people do not have the time or the know how to look for motivated sellers and this is where www.propertyinvestments.co.za can help.
WHERE TO FIND MOTIVATED SELLERS
When one for instance enters into a home loan arrangement, financial predicament is never the forecasted intention.
Nevertheless, the average home in SA is repossessed in as little as 18 months.
Buy-and-sell motivations differ from circumstance to circumstance and at the latter end of the state of affairs described above, the motivation is to sell the money-sapping impediment as soon as possible.
However, even in situations like these, one needs to focus on the best possible tools to bring you to your current solution.
Financial cycles.
A quick overview on repossessed property shows us that this unfortunate process is the end of a financial cycle.
It starts off with a loan and sadly ends in a sale of execution to the public.
When the financier enters into the process of repossession, a letter of demand is sent to the non-paying homeowner.
When the owner of the home does not conform to the content of the demand, a summons is issued by the creditor, which leaves the homeowner 10 days to respond.
Should he fail to pay the outstanding amount or fail to enter into an appearance to defend the matter, judgment is taken against his name.
Here after a warrant of execution is issued and the property can be sold on auction.
THE SOURCE NOW, the information on the property referred to is obtained on your behalf immediately after judgment has been taken by www.propertyinvestments.co.za.
At this stage the only person that has functional foreknowledge of the pending sale in execution, is the owner of the house and it is therefore not public knowledge yet.
The public generally knows it once it is advertised to be sold in execution.
This gives you a head start on the opportunity.
In layman's terms this is called a GIVE AWAY or a BARGAIN.
Once judgment has been taken, the details of the one burdened with the loan, is submitted to the various credit bureaus where it will remain unless the homeowner satisfies the home loan by selling the property.
www.propertyinvestments.co.za is the only website in South Africa that can give you access to more than 780 properties listed the last 30 days with a verified Judgments against them.
You can also visit www.propertyonauction.co.za if you want to get an insider’s look at what properties in South Africa will come on Auction over the next month.
Number of Auctions listed the last 30 days: 1866
Warning to all Property Pro Investors.
Do not think just because you can get a property at less than the banks valuation that it is a bargain.
Do the calculations using the Property Pro Investment Strategy and Program before you make an offer.
One of the biggest misconceptions about property investment is that the most critical part is the property itself - its condition and location.
The truth is that both of these considerations are secondary to the motivation of the seller.
If the seller is not motivated, then no matter what the condition or the location of the property, you are not going to get a great deal. But if you have a motivated seller, then you have a great chance of turning a handsome profit no matter what the condition or location.
When this really hits home, it revolutionizes how you prioritize your search for great deals.
No longer do you waste time doing due diligence and inspecting the house, until you have made sure you've found a motivated seller.
Once you found a motivated seller you can apply the Property Pro Investment Strategy and Program to verify if the property meets your investment objectives.
Finding Motivated Sellers.
Finding this motivated seller becomes the most important investment activity you can ever engage in.
You must focus your time, efforts, and creativity on searching for a motivated seller first.
Personal Example.
I use this strategy and during a challenge I bought 48 properties in 94 days looking at only 8 of the properties.
What signals must you look for?
In most cases motivated sellers are the result of some personal situation, unique to that individual.
Although the specific situation may be unique to that individual, there are certain patterns to look out for and then work out how to benefit from these.
By concentrating your efforts on these highly motivated sellers you will make life much easier for yourself.
Let's look at one of the patterns.
People run into financial difficulties. People get behind in payments, cannot get out of debt, find themselves threatened by outside factors such as an uncontrolled bond-rate, lose their jobs or become one of the 84% of new business owners that will close their doors within the first three years of operation.
Usually their property was used as their security to start their business.
There are many reasons for financial difficulties, but most people revert to selling their biggest asset, their house, when times get tough.
The bad thing is that if they cannot pay their debts then they can be sequestrated.
Not only have they lost every thing financially but they will also end up with a bad credit record and over the next five years they are out of the financial race.
Most people do not have the time or the know how to look for motivated sellers and this is where www.propertyinvestments.co.za can help.
WHERE TO FIND MOTIVATED SELLERS
When one for instance enters into a home loan arrangement, financial predicament is never the forecasted intention.
Nevertheless, the average home in SA is repossessed in as little as 18 months.
Buy-and-sell motivations differ from circumstance to circumstance and at the latter end of the state of affairs described above, the motivation is to sell the money-sapping impediment as soon as possible.
However, even in situations like these, one needs to focus on the best possible tools to bring you to your current solution.
Financial cycles.
A quick overview on repossessed property shows us that this unfortunate process is the end of a financial cycle.
It starts off with a loan and sadly ends in a sale of execution to the public.
When the financier enters into the process of repossession, a letter of demand is sent to the non-paying homeowner.
When the owner of the home does not conform to the content of the demand, a summons is issued by the creditor, which leaves the homeowner 10 days to respond.
Should he fail to pay the outstanding amount or fail to enter into an appearance to defend the matter, judgment is taken against his name.
Here after a warrant of execution is issued and the property can be sold on auction.
THE SOURCE NOW, the information on the property referred to is obtained on your behalf immediately after judgment has been taken by www.propertyinvestments.co.za.
At this stage the only person that has functional foreknowledge of the pending sale in execution, is the owner of the house and it is therefore not public knowledge yet.
The public generally knows it once it is advertised to be sold in execution.
This gives you a head start on the opportunity.
In layman's terms this is called a GIVE AWAY or a BARGAIN.
Once judgment has been taken, the details of the one burdened with the loan, is submitted to the various credit bureaus where it will remain unless the homeowner satisfies the home loan by selling the property.
www.propertyinvestments.co.za is the only website in South Africa that can give you access to more than 780 properties listed the last 30 days with a verified Judgments against them.
You can also visit www.propertyonauction.co.za if you want to get an insider’s look at what properties in South Africa will come on Auction over the next month.
Number of Auctions listed the last 30 days: 1866
Warning to all Property Pro Investors.
Do not think just because you can get a property at less than the banks valuation that it is a bargain.
Do the calculations using the Property Pro Investment Strategy and Program before you make an offer.
Subscribe to:
Posts (Atom)