Investing in Property in South Africa in 2019 - Good or bad idea?
I am a real estate agent based in Johannesburg, South Africa. Our property market is currently in a slump owing to political and economic factors. However there are great property deals to be found all around me. Prices are currently 20-30% below the peak in 2016. I am frustrated with the sales environment as qualified buyers are currently few and far between and those buyers that are serious offer way below asking price. Average time on the market is often 6 to 12 months or more! I would like to build financial freedom for myself and my family and have been dreaming of building an investment real estate portfolio for years now.
My conundrum is should I be building it in South Africa?
My wife and I currently own 2 rental properties in Johannesburg worth around $400k total. One of which is mortgaged for $80k. The other is mortgage free. So we have substantial equity in both properties. I would love to use that equity to buy more rental properties. My wife who is more conservative questions whether we should own property in this country at all. My opinion is that there has probably never been a better time to buy property here. South Africa, and particularly Johannesburg, is the economic hub of the continent. We have the most advanced banking and property title systems in the world. Interest rates are relatively low at 10.25% and we have a strong and functioning judiciary. There is a housing shortage in Johannesburg as a result of migration of the population in search of better work opportunities. Consequently there is strong rental demand.
Does anybody out there have some advice for me? Am I missing the boat by not jumping into real estate in South Africa? Or will I be threatening my family's financial future if I do? Is it possible to replicate what you guys in the US are doing? Are there any local investors who have carved a path to financial freedom through real estate in South Africa?