Many South Africans have short memories or are simply too young to have experienced it...the inevitable cycle of business. Whilst we are in turbulent times, those who have experienced tough times know that these are exciting times...a window of opportunity to enhance wealth creation while many go in to panic mode.
Only a few years ago the JSE All Share was at 10 000, rocketed to 33 000 and fell double quick time to around 20 000....still up 100% over 5 years or so but doom and gloom is spread through the media like wildfire as if the world is at an end! Those who remember our murderous 80's and Chris Stals' 25% interest rate environment will be calm and calculated, knowing that better times are on the horizon.
Not so long ago, property was the poor mans choice as far as many bankers were concerned...cash, equity and bonds were the predominant quotes given to investors up to the late 1990's...how times have changed! Property is now by far the least turbulent asset class that provides return and capital appreciation. Certainly there have been crunches and we expect these from time to time. As a hardened business man you will have a long term strategy that transcends cycles, even recessions, and will be usurping opportunities in the market. As long as the blood in your veins is type B-Positive, you will achieve success at the expense of the B-Negatives.
SA's interest rate environment seems to have peeked and heading south once again which is not a good sign for one who is cash flush and has not taken advantage of the strenuous market conditions. We do not expect a major shift in cap rates but we do anticipate a shift in expectations, leading once again to polarisation between property buyers and sellers. It is the broker’s responsibility to either find the upside for an investor or hold council with the seller, ensuring that expectations remain realistic and beneficiation is achieved by both parties.
Only a few years ago the JSE All Share was at 10 000, rocketed to 33 000 and fell double quick time to around 20 000....still up 100% over 5 years or so but doom and gloom is spread through the media like wildfire as if the world is at an end! Those who remember our murderous 80's and Chris Stals' 25% interest rate environment will be calm and calculated, knowing that better times are on the horizon.
Not so long ago, property was the poor mans choice as far as many bankers were concerned...cash, equity and bonds were the predominant quotes given to investors up to the late 1990's...how times have changed! Property is now by far the least turbulent asset class that provides return and capital appreciation. Certainly there have been crunches and we expect these from time to time. As a hardened business man you will have a long term strategy that transcends cycles, even recessions, and will be usurping opportunities in the market. As long as the blood in your veins is type B-Positive, you will achieve success at the expense of the B-Negatives.
SA's interest rate environment seems to have peeked and heading south once again which is not a good sign for one who is cash flush and has not taken advantage of the strenuous market conditions. We do not expect a major shift in cap rates but we do anticipate a shift in expectations, leading once again to polarisation between property buyers and sellers. It is the broker’s responsibility to either find the upside for an investor or hold council with the seller, ensuring that expectations remain realistic and beneficiation is achieved by both parties.
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