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How Frugal started his investment journey: a #Thread.
Frugal was working night shifts at a security company and studying. He couldn't get a loan for anything.
He partnered with 2 other people who had small, but stable jobs.
Frugal was working night shifts at a security company and studying. He couldn't get a loan for anything.
He partnered with 2 other people who had small, but stable jobs.
One of the people had contacts in the property industry. They introduced us to a property in a masepa area. It was terrible, but giving good returns : > 1%.
We decided to buy it. It was R300k for a 2bedroom place, and adding bond and transfer fees.
We decided to buy it. It was R300k for a 2bedroom place, and adding bond and transfer fees.
We took a 30 year loan, giving us a bit better cashflow, and the tenant gets to pay the bond. We also split the bond and transfer costs, rates, taxes and levies 3 ways - 33.33% each.
This made the risk a lot lower.
This made the risk a lot lower.
We bought it in our own name, with no paperwork of legal agreements.
DONT DO THIS.
These people are still good friends, many many years later - this is not the norm.
Please don't be stupid.
HAVE GOOD PAPERWORK IN PLACE!!
DONT DO THIS.
These people are still good friends, many many years later - this is not the norm.
Please don't be stupid.
HAVE GOOD PAPERWORK IN PLACE!!
About 3 years later I tried to buy my second place - my salary was so low, they had to do magic to get me the place but as I am a compulsive saver, I could afford it.
This was pre-NCR, but the banks weren't stupid, I had a prime +3% rate.
This was pre-NCR, but the banks weren't stupid, I had a prime +3% rate.
I have sold both these properties in the meantime - this gave me good capital gain so that I could invest the money in distressed and excellent cash flow positive deals.
This is why I say deposits help in reducing interest rates.
This is why I say deposits help in reducing interest rates.
If you have a problem with saving money or impulsively selling shares, then look into property - it's at a minimum a good way to force people to invest in an asset, even if it's not at the best rate.
Most people don't have anything to show after 40 years of working!
Most people don't have anything to show after 40 years of working!
Do I recommend investing in property to everyone?
No.
Do I think you can make a lot of money from property?
Yes.
This is some serious cash, and you don't want to just dash it out like a crazy chicken.
The banks will come after you!
Upskill yourself.
Grow.
Drink coffee
No.
Do I think you can make a lot of money from property?
Yes.
This is some serious cash, and you don't want to just dash it out like a crazy chicken.
The banks will come after you!
Upskill yourself.
Grow.
Drink coffee
