 and welcome to episode 34 of the Private Property Podcast. I'm your host, Zaman Tomu Kumalo. Of course, a lot of people say that, you know, crisis, you should never let a good crisis go to waste. Now, is this something that is applicable to property or not? That's exactly what we're going to be discussing this evening. If you're wondering whether or not to invest or not invest during the season, particularly in the property industry, this is a show you do not want to miss. And I've got a panel this evening. I know usually we have one guest, but we thought let's bring in a few power players who can help us better understand whether we should or shouldn't be, you know, investing. And if we're looking at investing, what are some of the opportunities and some of the risks we're investing during a global crisis? Troubles better understand and unpack this issue. I'm joined by Slindi Lisiane. I know, so that's why I'm even got a tongue twister of a surname. Slindi Lisiane, who is the founder and chairperson of Saki Seeswear Property Stockfile. Of course, we've spoken to her before in one of our previous episodes, and you can go back and watch that one where we look at some of the opportunities that you can take advantage of when you invest as a property stockfile. I'm also joined by Tatora Musoha, who is the founder of Wealth Creation and Robin Booth, who's the founder of the Property Booth. Good evening, lady and gents. Thank you so much for joining us this evening. I think I'm going to start with you, Slindi. I mean, you hit up a property stockfile and a lot of us are very aware of how stockfiles work. There's an increasing number of people who are looking at the stockfile model to invest in property because we understand the power of pulling together and putting our money together. And I've seen that as a stockfile, you're also looking at different opportunities that you can take advantages of. Perhaps let's look at some of the risks before we even look at the opportunities because I'm sure they're there. Some people are talking about them. Let's perhaps unpack some of the risks with investing during a global crisis. And some of the things we should probably be asking ourselves before we walk down that path. So some of the risks are that you don't know where the market is going to go, where the property prices are going to go. We don't know where the interest rates are going to go. We don't know what's going to happen with the rental market. There's a high risk of default. So if you're in the short-term space where Robin Booth is, for example, there might be a case of tourism is going to be constrained. So there might not be a lot of travel. People are going to be constrained in a lot of instances. So the real risk here is having high vacancy rates or your tenants actually defaulting. So I think those would be the biggest stress that as a property investor, you'd need to just be aware of and make sure that you manage and also just your property prices so that you don't overpay for a property because as the market will be constrained in the coming months, you wouldn't want to overpay for property. So making sure that you're actually purchasing at the right purchase point. Nantata, I actually want to bring you in here. I mean, Stimula has actually pointed out that one of the issues or one of the risks that you want to avoid is overpaying for a property. Oftentimes, a lot of property investors say that when it comes to real estate, you typically make money when you buy. So really wanting to look at some of the good opportunities where properties are priced well, but unfortunately, a lot of people watching at home might not know how to find out whether their property is well priced. And you're already seeing, as much as we're seeing a lot of properties, even on the private property website, for example, going down, we're also seeing a lot of people posting ads that have been up for months and hiking up those prices. So how do we then discern between whether or not that's the right price point and the price point that makes sense given where we are currently finding ourselves within the property sector? Well, I guess the first thing that one would have to look at is just ensure that you enlist the services of a bias agent. Bias agent is an agent that represents the interests of a buyer. So they have a few dictionary responsibility to you. So that would help you because in terms of purchasing property, they would then have to assist you to find it. And then afterwards, they would advise very well, whether it's overpriced or underpriced, and they will actually assist you to negotiate for the price. I mean, with agents, there's something that is called a CMA, Current Market Analysis. It's a tool that is used widely to determine the price of a property. And with regards to what is happening now, it's a global pandemic. And unfortunately, you have so many millennials. I read a report that said 60% of millennials are actually renting and they're looking to get into the property space. But property has been overpriced for a long time and the market must correct. However, the market has not corrected yet. We are still waiting for it to happen. There are a lot of factors that influence that. I mean, we had the lockdown. Then we also had the three month payment breaks. That actually delayed that process because you have people who would have easily been distressed sellers, but that process has been delayed by three months. So whatever had to happen has not happened yet. And if you're coming into the market now, I look into prices, they haven't changed that much if you're gonna segment them. I mean, 70% of the properties that are sold in South Africa are less than 1.5 million. So the ones that are over 1.5 million, they've been distressed for quite some time a number of years now. The prices are actually free falling. So when you look into the concentration of segments, you then realize that the more cheaper properties, there's higher competition for them and millennials are waiting for these houses as soon as others come in the market. I mean, for example, there's a house that we sold in eight days just this week because it came in very cheap. I had over 50 people who wanted it. We had multiple offers on it. So people are waiting for prices to fall. They are ready for them. You know, Robin, I actually want to bring you in here. Before we even look at some of the free falling prices, because I think, you know, I've seen different people and even myself, you know, a number of properties that have gotten very heavily discounted, which is of course great for people who want to buy. But before we even look at some of the discounted properties, perhaps let's look at some of the people who have bought and now we're finding ourselves in this economic crisis where perhaps, I mean, I know one of the sessions that you had run was around the strategies that you used to fill in your Airbnb vacancies. So then how do you look at filling in those particular vacancies when you've invested? Because we're telling people that let's suppose the one argument is definitely invest. This is a good time to invest. However, as Cindy has pointed out, there are certain factors that you actually need to consider before you make that jump. And Todd was pointing out that listen, there's a market and there are young people who are yearning and you know, hungry to actually buy. And some of them actually do have that cash, but the reality is perhaps they might not be able to, they might not be able to address some of the challenges that they find when an economic crisis like this comes on. So what are some of the strategies that, you know, we should essentially consider when we are buying right now, especially because we don't know how long COVID is going to last. So suppose we do get to, you know, level one and you're able to buy property in its entirety. I know today the level three regulations were updated by the minister of cocktail. And one of them was that, you know, estate agents are now able to work freely. When level four, they weren't able to work, which is of course great for the industry. But this does come with its own set of packages. How do we navigate buying during an economic crisis knowing that yes, there's rental demand, but those rental prices are heavily stressed. They're very likely going to go down because the reality is that's where the market is right now. A lot of people have lost their jobs and a lot of people are still going to be losing their jobs because we haven't quite felt the full effect of this COVID-19 crisis. So in the event where you do buy now, what are some of those strategies that you can use to make sure that you don't necessarily bankrupt yourself because you were chasing this easy buy and waiting for the markets to, you know, self-correct at some point? So what I really like is that we open up the conversation of what makes a successful real estate investor or a real estate investing portfolio is first and foremost understanding success, which is the skills that you've learned are coming up with the opportunities that are around and together those things really create a successful real estate investor. So for me, always the first thing we want to invest in is ourselves, right? Our education, our skill set so that we can answer those questions you're actually asking which are one of the strategies due to the circumstances that we've got at the moment that we can take advantage of that will actually still not mean that we're putting ourselves at risk. And I think that's really what you're alluding to is how can we manage all these different curve balls which the government's throwing us, COVID's throwing us and that is going to really, I think, unlock and pave the way for what we're looking at. And you're 100% right that for me and my business I'm always looking to see, you know, where can I position myself such that I actually can be in that space to take advantage of the kind of deals that are coming down the line. And I think, you know, at this point I want to really make it clear because even though we're on this panel at the moment we're talking about investing, we're talking about the challenges of what's going on around the world. For me and my business, I'm always investing from the space of how can I provide a solution to the seller who is needing to sell quickly? So I'm not taking advantage of them because for me that's unethical. You know, I want my purchase to be a meeting of an agreement that there's a willing seller and a willing buyer. I don't want someone to feel that I'm taking advantage of their dire situation. So if I'm thinking about that, I'm saying what is the biggest challenge that investors are having at the moment or just someone who owns a home that has to sell their house very quickly or over a short period of time. And I'm saying if I can provide a solution to them where I benefit and they're also benefiting then we're going to have incredible deals coming down the line. And those kind of deals just off the top of my mind are going to be around the creative financing deals because people are saying I've lost my job, how can I buy a property? The banks are going to be more strict on their lending, how can I buy without banks? So things like installment sales, set of financing deals, lease option deals where I can basically rent and then buy in a year's time like a rent to buy. All those kind of models, those strategies are going to be great opportunities for people to lock in the prices of today but not necessarily have to deposit all the money. And of course there's less risk in that. So I'm a great fan of all those strategies. I'm teaching all my students those strategies. And in that way I think we're going to actually come out of this together both in connection with the people who are struggling, the seller, as well as the tenants, as well as obviously us as the purchase. And I think you've hit the nail on the head. We need to run the numbers. We need to know what we're getting into because any risk that you can manage means that everything else is a bonus in the upside. So manage your risk and then you're free. And I actually want to pick up on this concept of running the numbers. It's one of those terms that we use quite a lot, said the on the show, a lot of guests who come on the show reiterate that a lot. I even say to myself, Ntata, I want to bring you in here. So when we look at viewers at home who are considering property, perhaps they've been on the fence for the past couple of months, they might be in their own residential property so they've already got a home that they're living in and really exploring, investing in property or adding property as an asset class. What are some of the numbers that they should be looking at? Because I think certainly the considerations are obviously different when you are buying to live in a particular property and then when you're looking at investing in a property. So what are some of these numbers that we keep telling people that they need to run? And how should they almost best try to figure out if this is the right investment? If you can perhaps share an example of how they should be thinking around a property investment. Yeah, well, definitely. I mean, the easiest numbers that almost all property investors use is your return on investments and your yield and calculating your cash flow projections, the taxes that are payable there. However, you can just wake up today and decide to want to invest in property and run those numbers by yourself. There are professionals, there are people who've been doing it for a while in our company, that's what we do. We offer bespoke services where we help people to run these numbers and calculate them for them because what you've done is we've created an Excel model that actually models all scenarios in terms of the taxes that you paid. For example, when you invest in property using the strategy of Gary, that's taking a bond from a bank investing in one townhouse or two or three. Basically, how it helps you is that because in the first five or seven years, the majority of your repayments are actually interest and not capital. So what that means is that you don't pay taxes on the interest in itself. So it reduces your tax liabilities to the state. However, there's another concept we call OPM, that's other people's money. I think Sarkis user uses the same concept as us, we do court funding day to stock fair, basically the same thing is instead of borrowing from the bank at an interest, you then have to borrow from each other interest free. And that helps you because at the end, for example, if each of us say 5,000 for 10 months and there's 10 of us, it's 50,000 each end of the year, there's 500,000, we actually purchase a townhouse. We own it from year one. We do that for the next two, three, four years by end of five years, we own five properties in our name. However, if you use the concept of Gary and you lock down yourself in an interest payment for the next 20 years, in five years time you still don't own the property. So what that means is if you lose your job, you lose the property and it's gone. So those are some of the things that people should actually look into and try to understand. So one, the first thing to do is just invest in yourself, invest in the education. If you can't get outsourced people who will do these things for you because I can assure you now it's gonna save you a tons load of money instead of just diving in there and doing it by yourself. And you know, before we go on a break and look at some of the opportunities, I actually want to ask you, what reason would you give viewers at home to not invest during this period? I'm going to ask all three of you this particular question because I think a lot of us certainly on this call are quite big in property. We know different and creative ways to raise funding. We know how to take advantage of a market, particularly the credit market that we're finding in. We certainly say on this show that it's a biased market and it has been even pre-COVID. And we're predicting that we'll probably stay a biased market for the next three to five years with of course those first sort of two to three years being sort of the good ground for bias to buy. So we can come up with a lot of reasons why people should potentially look at property as an asset class. But what reason would you give viewers at home to not buy? So under what circumstances? Should they perhaps pause and not buy at this current moment? And yeah, so I'll start with you, Stindily, because after the break, we're going to look at the opportunities and how to take advantage of the opportunities and the different opportunities that are out there that viewers at home can take advantage of. Srin? I think most sectors are impacted with the lockdown. So there's still a lot of uncertainty in the market around whether we're going to still have jobs, what that looks like, whether we might have seller cuts and all of that. So if you are in a particularly vulnerable sector, it might not really make the most sense for you to start looking for a property right now. So maybe wait a bit and see what happens, because I'm even seeing what some of my tenants are now starting to get them saying, we've been told that it must take a 20% cut or 10% cut or whatever the case is. So if you are not yet sure where you stand and you don't have any reserves available, rather not get yourself in a tight spot where now you might actually end up damaging your credit record or losing your property. So you need to understand where your finances are. Maybe just rather wait it out for a couple of months until you know where you stand. So that's the one thing that I would advise you not to get started with property. If you're looking at investment, like Ezen Tatru said, if you don't know what you're doing, you don't wanna be making mistakes right now and buying a property that's going to actually cost you money where you need to pay in money, which means that now you're actually losing money every month. So should you actually lose your job? You're actually going to lose the property as well. So all your efforts has been wasted. So if you are going to look at getting an investment property, you need to make sure that you're buying it right and that it makes money for you so that even if you lose your job, you don't lose the property because it pays for itself. So that, and even then you still need to be sure what's gonna happen with the markets and all of that and make sure that when you purchase your buying, like at a heavy discount to the market value so that the rent should comfortably be able to cover all your expenses. So I think just be cautious and do your research and maybe wait it out for the next month or two until you know what's your situation. So don't rush into it, especially if you don't know what you're doing or you're like a first-time investor or first-time buyer or rather wait out of bed because I think the banks are gonna start getting very strict as well with regards to lending. So those are some of the things that I would say you must consider. Robin, any additions then? No, actually I think it's, for me it's really around running your numbers, know what you're actually getting into. And if you don't feel confident about it, then reach out to someone that can help you. There's just so much information around actually how to run a number, what are the basics to understand. And the more you can just put that in place, the more you're actually going to feel the confidence and actually then make sure you're making the right decision. We either have the pain of regret or we have the pain of self-discipline and successful real estate investors understand that the self-discipline of finding out what ROI is and what are the different costs involved are the ones that are gonna create success. And I think that's certainly what this lockdown has provided for many people is actually an opportunity to upskill themselves. Tatu, any addition on your side? Hi, yeah, definitely. On the reasons not to buy, I'd say the major one for me would be interest rates, especially for first-time home buyers. Just to be honest with you, interest rates are at their lowest they've been in South Africa in just over 50 years. What that means is that it gives the purchase a false affordability. If you afford to purchase for 5,000, before COVID, you'd probably buy a house of 500,000. But now because interest rates are so low, you can actually, you think you afford a house of 650,000 or 700,000. What you don't know is that there's a flip side to this. Look at what happened in 1998, repo rate was up 23.99%. In 2008, repo rate was over 15%. Now it's sitting on just under 4%. So imagine if you purchase a property now and the repo rate actually goes up to 23%. I cannot show you it's going to be a bloodbath. So do not make your purchasing decision solely based on the interest rates. It's a trap. Don't do it. And we're going to go for that quick break. Of course, if you've got any questions or comments, do send them through. We're still talking about to invest or not to invest, buying a property during a global crisis. We'll be back just after this. Welcome back to episode 34 of the Private Property Podcast. I'm your host, Zamantunga Kumala. Tonight, of course, we're looking at to invest or not to invest, buying a property during a global crisis. Got a panel for us helping us better understand that it's a good time to buy or not. And we're putting some of the opportunities and risks of looking into investing in real estate. That panel is Uslindi Lele Sian, who's the founder and chairperson of Saki Sees, where property stock fell. We've also got Ntato Ramoshoch, who's the founder of wealth creation, as well as Robin Booth, who's the founder of the property booth. Before the break, we looked at some of the risks involved and I asked the panel, there are reasons for not buying during this crisis. And I think a very important one that Ntato actually highlighted was that interest rates are at an all-time high or at a 50-year high, I mean, 50-year low, rather. And a lot of people are probably thinking, well, I can now afford that half a million Rand or 700,000 Rand property, but in reality, it's a fault affordability. We already know we're going to see interest rates going higher. They've gone historically low because of the crisis that we find ourselves. Thinking that you can afford a 700,000 Rand or one million Rand house is actually false. So you really do want to be careful that in the event where you get enough affordability, that says X, when you do buy, you essentially factor that in and don't max out that amount, unless you've adequately calculated for it and are still going to afford to service that home loan should interest rates or rather, when interest rates go high. Now, of course, I also want to look at the opportunities. I mean, a lot of our viewers at home either first-time home buyers or already property investors themselves, and they're always keen to look at some of the opportunities that they can take advantage of certainly during this crisis. One of the things that you mentioned, Robin, was this idea of financial creative deals or creative financial deals. And a lot of people, I mean, I think typically tend to think if you want to buy a home loan or you want to buy a particular property rather, you have to approach the banks because people don't have a million Rand lying around. If they do, please do contact us. We can find different ways to maximize your money. But a lot of South Africans just don't have that kind of money running around. So different property investors try to find different ways to raise capital and to raise that money. Perhaps it'd like us to explore some of those different ways. And we'll also look at what Saki Seesway is doing and the different ways that they're raising capital to ensure that it benefits their members. But Robin, what are some of those creative financial deals or ways that investors can explore? Particularly given that a lot of people right now, their income is affected. So if you're trying to reach out to friends and family, friends and family likely will not have that money. So how do we creatively essentially raise that capital? So one of the ways that we're preparing for at this moment is the installment sale, which is really saying to the person who is selling the property, if they'd be willing to be our bank. In other words, they are actually going to kind of lend us the money. In other words, instead of going to a bank and saying, can I please get money to go pay the purchase of the seller to actually buy this property? I'm saying, can you please sell me the bank in install me the property in installments over a set period of time according to an agreement. And in that way, it actually frees me up from having to go to the bank to go to the traditional credit checks, but it still is a legal process. So it's still registered. This is still protecting both the seller and the buyer, but it's an agreement that we are into such that we can actually buy this property over a certain period of time. And I think that's gonna unlock a lot of value for people who are actually saying, well, I'm not gonna be able to go to anyone who's gonna give me that kind of money. And for me, that's what's really gonna be really exciting. I've got a lot of students who are really doing that all over. And those properties can be anywhere between 400,000 rounds to as much as 3.5 million rounds. It's not that this is just for a specific niche market. It's actually really an appropriate way for you to say, I can't afford to pay everything right now, in other words, a full purchase price. But if we say I'll pay you the purchase price in five years time, in between now and then, I'll pay you in installments that thing which can actually, I'm quite a bit in South Africa, a lot overseas. And of course, as I said, it's not just an under the counter kind of deal. This is actually a legitimate legal process. And I think for those people who are saying, what else can I do? That's my first go-to. And I suppose one of the reasons, Rowan White may not be used as much in South Africa is because we tend to find that sellers essentially need that cash, right? So you're trying to find a seller that isn't cash-strapped or trying to let go of that asset so that they purchase another asset. And if they're heavily bonded and really the money from the sale of that property is going to be used to free up their own cash flow, then of course an installment sale deal is not going to work. So it really is about identifying a seller who isn't cash-strapped, probably has a number of properties and they are more than happy to let go of some of the properties in a slower fashion as opposed to needing that cash instantly. Patience and comments from viewers at home. And we've got one from Bruno Santos who says, this might sound bad, but should we not wait three to 18 months as more people struggle and continue to use jobs and more properties come into the market? The market floods and the prices drop even further. Let me point that one to you in title. So instead of, for example, taking advantage of the property market right now or looking at buying at this moment, perhaps wait three even up to 18 months to assess how the situation is going to go and then make that purchase. Yeah, definitely, I fully agree. There's no advantage to be taken right now to be fair. As we said that the interventions that came into play, they actually delayed the effects of COVID and also we're looking into the effects of the recession that we are in. We're looking at the 6% GDP question. We're looking into a lot of factors that all of them are coming together so fast and by the time they collide, we are envisaging that the economy first has to fall. Once it has fallen, then the property market will fall. It doesn't fall on its own. So as things than the property market, it's still standing, it's fine all is well, we wait for it to fall fast because now there are not much distressed sellers. The people whom I have picked up who are selling and I've actually called to find out the reasons why they're selling, most of them are panicking. So they're selling out of panic. There's really not a reason for them to say, I want to sell, I'm distressed. They are not yet distressed, they're thinking, let me sell now before the market flats. But again, it's just a matter of trying to be safe. What I'm saying is property prices have not fallen yet en masse. So if you are looking at distressed sellers, if you are looking at property prices falling and falling hard, it has not yet happened. So hold on to your money. Properties should fall, properties will fall. You know, when you talk of falling in the economy, falling, I thought that came to mind was the Reserve Bank Governor, Elisa Jackanyahu. Definitely should not hear you talking about economy falling because they're working very hard, of course, to make sure that that doesn't happen. I think South Africa's got sufficient systems to ensure that we don't suffer the same effects, for example, that we saw in the US during the 2008 crisis, if anything. If you look at a lot of the briefings that the Reserve Bank has essentially done, we see that we're so quite fine. I think there was a webinar I was watching where the Standard Bank CEO was actually speaking about how for the most part, banks right now are their balance sheets are healthy. So South African banks balance sheets are quite healthy. We're not going to see them panicking at all at this moment. So I think for years at home, maybe it's not going to completely fall. You will certainly see distressed sellers in the coming months, but I don't think you should expect a one million rent property to go for a hundred thousand rents. It's not going to happen. It's simply not going to happen. So even understanding that I think is quite crucial because a lot of people are going to say, you'll get properties dirt cheap, but understand what that dirt cheap is. It's really is in relative terms. So maybe that one million rent property might go for a 600,000 rents and it's been sitting at one million rents. That's quite a significant discount, but you're certainly not going to get it for a hundred thousand rents. So I think when we also need to manage our expectations when we're looking for those property discounts, we've got a lot of questions and comments that are actually around the low interest rates and approaching our banks for a fixed interest rates. So earlier in Taddu was saying how when we look at these low interest rates and people who are going to afford to get their foot in the property letter, the figure, the affordability figure that you're essentially going to be given right now is a false positive in the context that interest rates are going to climb. They may obviously not climb to 23%. We certainly doubt we're going to see that there's nothing in the market that indicates that they're going to be that high, but perhaps I'll go back to where they were in January this year. People are wondering how to go about getting a fixed interest rate on their home loans, whether they should consider it. A lot of home loans typically aren't fixed for that 20-year period. Some banks will fix it maybe for three years or up to five years. So is that something that they should consider right now? And then this is of course a question even asked the banks when we have them on around whether or not they have an appetite to get into fixed interest rates for home loans at this particular point and relatively where they're picking it at considering that we are at such a low because we know that those fixed interest rates typically are slightly higher than the actual interest rate because they are locking you in. So the banks are of course a business so they also try to insulate themselves. So Romana, I'll give that question to you. How do people navigate trying to get a fixed interest rate to take advantage of these low interest rates at this moment? So what I love about real estate investing is you can actually go and ask the people who are doing the kind of deal successfully what they're doing and what they're thinking, right? Because it's picking out of them. We don't have to figure that out. So in a lot of the circles that in the groups that I've been in and that we're talking about the general sense at the moment is not to peg your interest rate. But firstly, because as you said, banks are very cautious about it at the moment because they so low they themselves don't want to lock themselves into something which later on they can't change. And of course they might then be saying, well, we'll give you a fixed interest rate but only for the first three years and for the first four years. And you think, okay, that's fine. I'm going to sort that out. And then when your four or your five comes in where suddenly it repivots back then your numbers just never worked because they were based on the initial period. And I think in Tato mentioned that we need to really be careful of not understanding what those clauses and terms and conditions are when we're taking out a home loan. And that could really lead us into a very tricky situation where you're celebrating. I got such a great deal. And then four years later suddenly the numbers changed and now you're a motivated seller that has to flog your property. Otherwise you're in trouble. So my advice is go and do the research but what I can share with you is in the level of the experts out there they're saying do not and take your interest rate. Stendile, we've got a question here from Zola K. Sibanda who asks are we likely to see developers drop their prices on new developments? The new developments is an interesting one because they usually like the there's usually like a standard price for building per square meter whatever the case might be. So and usually it's a bit higher than for example buying an existing property because obviously you're buying a new stock and all of that. So I think in the upcoming months they might battle to sell some units they might discount them a little but I don't think so though. So you just really need to be careful when you're buying a new development and make sure that the number still makes sense for you and that the purchase actually is going to give you the returns that you're expecting. So in terms of where that's going to go it really is going to have to be a case of let's wait and see because development has been so they've had that all those holding costs are they going to add them back again? What's going to happen? So it really is going to be a matter of just make sure that you do your numbers and you make sure that you know what you're getting yourself into. And usually those prices are usually not negotiable. So when a particular, for example a one bedroom you're selling for 500,000 rent that's what you pay. So yeah, so just be very careful and make sure that you do your numbers and you do your research properly as well in terms of what the expected rentals are going to be and that whether you're still going to be able to make a profit when you buy now from an off-plan development. To viewers at home, we are still taking your questions and comments on whether or not to invest during this global crisis. We've got a question here from Miguel Martins who asks what are the expectations for rents? Will they decrease? Are we expecting a decrease in rental prices? Let me give it to you in Tato. Tato, can you just unmute your mic there? I've just unmuted. Are you referring to the interest rates or the rates for the rental market is in the house? So this is our rental market, so for rent? Yeah, well, they should decrease but I don't think they will decrease that much because there are a lot of factors that are coming into play and they're actually seeming as though they're balancing themselves out. Like I said, there are certain factors against people selling and the factors pro-selling and so in terms of the housing market it was put on a standstill for quite some time and also considering that people who'll be losing their houses would most probably go to rent. So there will be some slight demand but that was expected for the past two years and that never happened because the economy was so bad it was in research that the rental market would actually boom but it didn't boom and you have a few people who actually are reducing prices. So it's a bit balanced out. It depends mainly on the suburb that you are in and the demand for it. I mean, you look into the top performing rental suburbs you have, Tambisa, you have Soweto, you have Centurion. There the demand is so high that you can actually get away with increasing prices even at a time like this but then if you're at a different location it's actually a different ball game altogether. And I think when it comes to rental prices I saw TPN releasing data earlier today where they were showing the top 21 performing suburbs in the country during lockdown and they found that the top performing suburbs surprisingly or perhaps not surprisingly was Stellenbosch that had I think a 92% in good standing rental during lockdown and going into lockdown I think it was at about 95 or if it wasn't 97%. So you begin to understand when you look at data like that it was also able to help you determine which place is relatively safe to invest in because people who typically rent in those areas tend to pay their rent on time every month. So we really do want to use different resources to help you navigate whether or not to buy particularly certain areas. I think the low interest rate has just given us an opportunity to enter into the property market especially if you are an investor or buying to rent and I agree that one should not solely look at or solely look at a decision based on low interest rates and of course that is something we've been echoing here. Before we wrap up this evening's show I think I want to get around Robin from our guests around some of the reasons why we should consider going into or investing in real estate during this crisis and perhaps what to think about before we actually sign that OTP I'm going to start with you again, Cindy Le. Yeah, let me just make myself clear. So property is a long term game so there's going to be ups and downs there's going to be cycles where you feel like maybe now I should enter maybe now I shouldn't enter. So if you're thinking for short term games maybe you shouldn't do this but I mean if you're thinking the long term you should look at getting into property and make sure that you're buying when the time is right and that you do your numbers and you do your research like you've mentioned using tools like TPN and all of that. So do your research properly and understand that property is a foundation or building block for wealth. So if you're looking at long term wealth you should definitely consider property as part of your wealth creation strategy. Thank you and let's hear from yourself and Tatto. Well I would say part of the reasons one could actually consider buying now is certainly because of the up sellers who are selling their prices now and they actually panicking for whatever reasons and their properties are actually coming in quite cheap into the market. So if you had determined that you want to buy before even COVID you know that you want to buy because we know that property investors it's not just for to have a tenant sometimes it's for your primary residence that you want to live in and you've been tracking that suburb for a while. So I'd say you can buy for that reason. Also I'd advise people to turn on the alets you know on private property it has that functionality of alets turn your alets on and they will alert you when prices are actually going down they will alert you when a new property is coming into the market track them for some time and then once you've tracked it you'll see the prices dwindling a bit and changing and then do your numbers and know that the value of the property in itself and that if it's selling for a cheap you can take it now or if it's selling at a price that you are comfortable with because remember that not all properties are going to fall. Sometimes the property meets your spec it has a swimming pool it has a big yard it has four bedrooms that you want what are the odds that you're gonna find it again. So again it depends on your personal reasons we don't just go as a mop when it comes to investing in property it's up to you and your needs. Thank you very much and Tartor Robin. So I think you know, Céline Delier and Tartor have mentioned some really important points you know on the one hand if you're going to look at buying a property that's got a low price so that you can flip it well you're not really gonna be able to flip it in a market which is decreasing because people are struggling to sell so you're gonna have to know your job to be able to buy to hold it for a year or two till the prices come up and then sell so that could be your strategy but what we haven't really chatted about is that AB&B market right because that's just totally been obliterated in South Africa and we're going to see coming down the line a lot of apartments in beautiful places which people bought for AB&B which they can't manage and run at the moment and they're gonna be selling them and that is very different this is a different opportunity than what we've seen before and we're gonna see quite a few of those coming down the line and the best thing about them is they're gonna be rent ready. In other words these hosts these landlords have already got fully furnished properties beautiful and they're gonna need to let them go because they just never factored in such a pandemic and we're gonna see a lot of those coming down and if you can just target those, find them then you can rent them out in the short term AB&B will come back and it's my AB&B units are still full even with level five and level four criteria being met and they still are full so it's not like this is never gonna happen it's a great opportunity and I think that that's a target if you're interested in that kind of model definitely look out for that. And I think Robin that's certainly a topic that we're going to explore right here on the private property podcast. Thank you so much to my panel this evening we've been speaking to Slindi Lelysiana who's the founder and chairperson of Sarkisizia property in Stockville and Tato Rabushakha who is the founder of wealth creation and Robin Booth who's the founder of the property booth. I think a very big takeaway for this one is understand what you're going into it's not as simple as interest rates I don't know at a 50 year low therefore it means it's a good time to buy right now you want to educate yourself as much as possible and you can use resources just like the private property podcast but also use the services of a professional because you want to make sure that when you sign that offer to purchase you understand all the numbers that go into that particular deal so make sure that you run the numbers speak to professionals and of course continue watching the private property show of course we're back again tomorrow evening with more insightful property content helping each other better understand this property market and exploring the different opportunities and risks in property and so tomorrow evening I'll be back tomorrow Hi, I'm Brandon Rubin the suburbs of Brea and Morningside which is that over the sharks and most of the tablets it's got an incredible living in Morningside makes so much sense to us because everything is so central anything that we choose to do is a couple of kilometres away or a couple hundred metres away restaurants, coffee shops it's all here on our doorstep you know we've got great schools here the girls schools just close by our Maristella and Durban Girls College and then fantastic boys schools Durban Preparatory, High School, DPHS one of the top primary schools in the country and then Tifton which now goes all the way to High School it's so convenient to be in this area where everything is close by some of our closest friends stay just across the Ungani River in Durban North Durban North is very family-orientated with some great schools some excellent restaurants and some small commercial centres the promenade along Durban's beachfront also known as the Golden Mile got an incredible facelift for the 2010 World Cup and today is used by all of Durban's population we as a family love the Durban Beachfront if we're not in the water you'll find us on our bicycles along the promenade being a World Cattle Board Champion I travel to some of the most amazing beaches around the world but nothing comes close to what we have here in Durban Durban has great weather and great conditions all year round for surfing and for training and just being in the ocean and that's why it's known as the warmest place to be we've lived here our whole lives and there's no place we'd rather be and this is our neighbourhood I'm Brian Kappa I'm a 10 times South African Motorcycling Champion my family and I have chosen to live in four ways there's some really great suburbs in our neighbourhood there's a lot of families living in the surrounding areas in places like Lonehill and Cedar Lakes what draws people to Cedar Lakes is that it's so close to the Broadacre Shopping Centre Cedar Square and Four Ways Life Hospital Lonehill is a major draw card for many families it's got some great smaller commercial centres and some fantastic schools like Crawford College from an entertainment point of view Montecassino really comes alive at night there's so much on the go and there's an incredible energy in the area our family just loves the fast paced lifestyle that Four Ways brings but honestly, the thing that attracted us most to this area was the active lifestyle that it offers as a family we've chosen to live in Four Ways because of the lifestyle and convenience and this is our neighbourhood