Tag Archives: Buying property Johannesburg

The Downshifting Dilemma: Buying or Renting Abroad

Buying a property to call your own is tempting, but in some cities, it makes far better financial sense to rent. To help you decide, we list a;

Buying or Renting Abroad, Johannesburg is good for buying
Buying or Renting Abroad, Johannesburg is good for buying

Rental Yield Comparison when Buying or Renting Abroad.

According to Global Property Guide “The gross annual rental income, expressed as a percentage of property purchase price. This is what a landlord can expect as return on his investment before taxes, maintenance fees and other costs.”

The Gross Rental Yield may seem insignificant if you are buying a property to live in. But, it is a useful statistic to know for two reasons. Firstly, if rental yields are low, then it makes more sense to rather rent than buy. Secondly, high rental yields are often a good indication of good capital growth potential.

Buy in South Africa, Rent in India

Numbeo.com is an excellent resource for rental yields and they have just released new Cost of Living information for January 2017. I’m a bit obsessed with browsing the stats; Seeing how cheap rent and food is in Bangalore never fails to amaze me. And on the flip side, I wonder why New Yorkers continue to slave away to maintain their high cost of living, when they could have a better work-life balance in Cape Town or Lisbon.

Numbeo.com lists this guide when deciding on Buying or Renting Abroad;

  • 3% = do not buy
  • 6% = borderline
  • 9% = ok to buy

I’ve been fortunate to buy some investment properties in Johannesburg and Cape Town that have allowed me to escape my stressful corporate job. And my experience is that the “Outside of City Centre Gross Rental Yields” of 12.11% for Johannesburg and 10.56% for Cape Town are both achievable. It makes good financial sense to buy in South Africa and Mexico. But Delhi is at the bottom of the list and you’d be far better off renting there.

Numbeo City Stats Rental Yield City Centre Yield Out of Centre
Johannesburg, S. Africa 11.34% 12.11%
Cape Town, S. Africa 7.84% 10.56%
Mexico City, Mexico 6.70% 7.29%
Lima, Peru 6.29% 5.95%
Hanoi, Vietnam 3.69% 7.33%
Budapest, Hungary 5.21% 5.80%
SaintPetersburg, Russia 5.24% 5.69%
Santiago, Chile 4.70% 5.82%
Istanbul, Turkey 4.71% 5.61%
Warsaw, Poland 4.44% 5.12%
Bogota, Colombia 4.70% 4.73%
Chiang Mai, Thailand 4.81% 4.54%
Lisbon, Portugal 4.19% 4.97%
Athens, Greece 4.33% 4.00%
Bangkok, Thailand 4.18% 3.95%
Bangalore, India 3.45% 4.62%
Prague, Czech Republic 3.50% 4.11%
BuenosAires, Argentina 3.60% 3.89%
Delhi, India 2.46% 3.15%

@NomadicYou Would you prefer buying or renting abroad in your new downshifting city? What scares you most about foreign property ownership?

Feel free to contact me if you have any questions about buying in Cape Town or Johannesburg. Property investing is my favourite topic!

Continue reading The Downshifting Dilemma: Buying or Renting Abroad

The cheapest cities to buy property for downshifters

Time for a vacation property or downshifting home? The cheapest cities to buy property that are affordable to live in too. Antalya, Jo’burg, Phuket & more.

Your view for $60,000, Jackal Creek Golf Estate Johannesburg, Photo www.steeple.co.za

I must confess, I’m obsessed with watching House Hunters International and surfing property websites. Maybe I played Monopoly too much as a child. And, having Cape Town and Johannesburg properties that have been successful investments, probably fuels my obsession further.

In Cape Town I have vacation properties that I rent out to corporates and holiday visitors. I’ve been lucky to collaborate with a lady who runs a cleaning service and who does meet and greats for my holiday visitors too. Don’t be afraid to jump into the vacation property market! If I didn’t buy when I did, I would be paying around 50% more for the same apartments.

Should I rent or buy my downshifting property?

In yesterday’s post, we saw that India is very cheap to rent in. Strangely, property there isn’t cheap to buy. South Africa is the opposite though. With bank lending rates being quite high in SA, property prices are suppressed. Rentals in Cape Town and Jo’burg are not cheap though.

Hours of watching House Hunters has taught me one thing for sure: buying property in South Africa is a steal. For $60,000 you could be the lucky owner of a 2-bedroom apartment in Jackal Creek golf estate in Jo’burg or an apartment close to the winelands in Somerset West, Cape Town.

25 best cities for buying property

Turkey tops the list with the most affordable coastal property. A property outside the city center in Antalya will only set you back around $412.29. Bali also makes the top 10. But, property ownership there is a bit murky; expats who reside (legally) in Indonesia can only own landed houses in the country for a period up to 80 years. No doubt marrying a Thai, makes ownership there much easier!

Besides, property websites my other website obsession is www.numbeo.com Until they develop a house price index, try this list of the cheapest cities to buy property based on Numbeo stats;

City Rank Price per sqr mtr City Center Price per sq mtr Outside Center
1 Antalya $811.38 $412.29
2 PlayaDelCarmen $888.39 $697.73
3 Johannesburg $933.65 $661.34
4 Colombo $1 361.06 $822.24
5 Bangalore $1 569.04 $709.86
6 Mexico City $1 473.91 $856.22
7 Phuket $1 518.03 $952.86
8 Chiang Mai $1 558.90 $945.85
9 Bali $1 400.78 $1 237.03
10 Cape Town $1 821.70 $926.68
11 Budapest $1 712.88 $1 050.90
12 Athens $1 434.19 $1 609.92
13 Johor Baru $2 168.90 $923.79
14 Bogota $1 695.79 $1 401.16
15 Istanbul $2 208.51 $975.57
16 SaintPetersburg $2 117.09 $1 233.81
17 Lima $2 119.78 $1 246.75
18 Santiago $1 925.79 $1 555.78
19 Delhi $2 599.63 $1 119.77
20 Hanoi $2 816.32 $976.33
21 Warsaw $2 525.17 $1 658.39
22 Buenos Aires $2 762.36 $1 956.35
23 Lisbon $3 347.24 $1 801.57
24 Prague $3 446.41 $2 031.44
25 Bangkok $3 944.54 $1 818.69

@NomadicYou #Turkey, #SouthAfrica and #Mexico all have cheap #property. Which would you choose?