My alternative property strategy
Where it all began
My wife and I have always had the desire to invest in property, but have found it difficult to gain entry into the market for financial reasons. Cape Town has always been home to us, so naturally we wanted buy a property in Cape Town. However, buying a property meant settling down. It meant moving to the suburbs. It meant living in an undesirable and more affordable area – at least for a few years until we could sell or rent the original purchased property and upgrade to a better property in a better location. I needed an alternative property strategy.
Thinking differently
This traditional way thinking of makes a great deal of sense and for us it seemed to be the only option available. I am the more financially-minded in the relationship and I have always been dead-set on buying property. Whilst I wanted the travel lifestyle, I also understand the benefit of property investment, and I had a strong need to make this a reality. My wife felt differently. Being more free-spirited, she felt strongly that we needed to live our best life and was strongly opposed to the idea of settling down in the suburbs. To her “our best life” meant enjoying each day, the lifestyle of living in an interesting location and travelling the world at every opportunity. I understood her point and to be honest I wanted that too, but strongly felt we needed to strike a balance. For years we debated this topic and we decided to save for a property and buy a small apartment in an area we wanted to live in. We decided to compromise on size, not on lifestyle.
During this time we rented a 2-bedroomed apartment in a good area. Whilst the apartment was certainly not cheap, it was far less than the bond repayment that he would have to cover should we buy a property – Bond repayment calculator. We were focussed on buying a property at some point in the near future, and we wanted to put down a reasonable deposit to ensure a good interest rate was offered by a bank on the bond repayment. For years we saved only to find that due to the rising property prices, the market continued to be just out of reach. The monthly repayment was always just too much, the deposit was never enough and we were never quite ready.
The lightbulb moment
One day I read about Property Investment Clubs and was intrigued by this possibility. I got talking with a friend and colleague, only to find out that he had already started an investment club. I started reading more on the topic and before long came to the conclusion that this was the solution to our property conundrum. Here’s where you can start Starting a property investment club box deal.
Using an Property Investment Club, I was able to gain entry into the property market without needing to compromise on our desire to live in a good area. I needed to put in less initial capital to start with for the first investment. My alternative property strategy was born. I benefited from the combined buying power of the club and invested in small high yield (high return) properties. As the investment portfolio grew in value (due to the combined impact of appreciation, loan payoff and cash flow) we grew the portfolio size strategically without the need to put more cash into the club. My wife and I continued renting and living in the area we preferred to be. A win-win scenario!
Property Investment Clubs are a great means for investors like myself who want to get into property without compromising too much from their current lifestyle. If you have any queries, please contact us!
Ryan & The Property Templates Team
