While many are viewing the property investment market critically, due to obvious losses in many sectors, the shrewd investor knows that opportunities exist in every single market condition.
Similarly, stock market investors will shift their stock holdings from perhaps retail into gold or platinum as the market conditions change. To claim that there is no money to be made on the stock exchange just because a certain stock did not perform is silly and short sighted.
Of importance to note, is that property prices are fast approaching their levels of 12 to 18 months ago. In other words, the investor in property has lost nothing in terms of capital. Those that lost through forced sales (and I do not want to appear unfeeling here), did so because they bought in an overpriced market at a level above their safe risk zone. In other words, only bad investors have lost money on property.
The question therefore is simply - what makes a good investment currently. Commercial properties continue to be under stress and the statistics from many shopping centers will bear this out. Pure residential investment while currently viable in a growing market can be viable but one needs to still be careful of secondary fallout form the global recession.
My thoughts? Go for student accommodation. The opening up of South African society has seen massive increases in demand for university and college education. Subsidies are widely available. Many more people from the previously disadvantaged groups are entering the middle and upper income groups. Rural areas are developing and student aspirations with it. This burgeoning group of students will need a place to stay.
A stroll around any inner city area or suburbia close to places of further learning quickly reveals that students make up a large group of the population - by tenancy. Simply because the institutions themselves cannot cope or are overpriced.
Viewed in these terms, a two bedroomed flat, instead of generating a single rental income, can now be viewed as shared accommodation for four students - with corresponding increases in total rental income. And of course students are less demanding in terms of demanding the kitchen be revamped and other such demands. Providing the accommodation is neat you will have happy tenants - and parents or subsidies footing the bill.
Many of these students are being abused in terms of quality of accomodation and if you set yourself apart as a landlord of choice, you will have a never ending stream of income.