# Shall I sell or rent my house before leaving SA



## Ivapan (Jun 24, 2011)

I would like your advice on whether to sell or rent my cluster in Johannesburg. After living for 10 years in South Africa, I'm moving back to Bulgaria and can't make up my mind on whether to sell or rent. I am very worried about the political situation when it comes to properties and all the talks about nationalization. If I rent, the rental income will cover all the expenses and the bond. However, I'm worried about the additional future costs, i.e maintenance issues. Have any of you experienced a similar situation?


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## Daxk (Jan 20, 2008)

yes.
as soon as I can find a buyer who qualifies for a bond, mines sold.
(been renting my primary house out for past 6 years)
residential property is more hassle than commercial property.


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## Ivapan (Jun 24, 2011)

Daxk said:


> yes.
> as soon as I can find a buyer who qualifies for a bond, mines sold.
> (been renting my primary house out for past 6 years)
> residential property is more hassle than commercial property.


Thanks for the advice. That's what I've been busy doing, but it is very difficult. So, I presume you don't see keeping a house in SA as a good investment?


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## Daxk (Jan 20, 2008)

Not anymore, the law has and is changing so that its almost impossible and expensive to evict a non-oaying tenant.
I have a very good rental agent but although property is booming at the Coast, I think the major growth in Property value is going to slow down.
when i bought I had good growth of around 18% pa, thats down to about 3% now and the hassles of being an absentee landlord are not worth it.
what I have still got is commercial property and that I will hang onto.


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## Saartjie (Mar 1, 2010)

I agree totally. We own two houses that we rent out and it is not worth the hassle for sure (and we are in SA). We are trying to sell ours but market is slow but as soon as we find a buyer we will get rid of them. As previously stated, it is almost impossible to remove a sitting tenant which creates huge problems for residential landlords. My advice would be to sell if you can.


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## Ivapan (Jun 24, 2011)

Thanks for the prompt advice. I will keep trying to sell it then. However, being emotionally attached to a property doesn't help.


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## Saartjie (Mar 1, 2010)

Ivapan said:


> Thanks for the prompt advice. I will keep trying to sell it then. However, being emotionally attached to a property doesn't help.


Yes I guess it is different when you are considering selling your actual home. But in the long run I think it will cause you less stress for sure. Good luck with sale and move.


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## Daxk (Jan 20, 2008)

People sell Houses, others buy Homes.


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## casey1 (Jun 21, 2009)

Saartjie said:


> I agree totally. We own two houses that we rent out and it is not worth the hassle for sure (and we are in SA). We are trying to sell ours but market is slow but as soon as we find a buyer we will get rid of them. As previously stated, it is almost impossible to remove a sitting tenant which creates huge problems for residential landlords. My advice would be to sell if you can.


I also agree with all of the above, I moved away from Jhb two years ago, had a good tenant for five years but then he moved out in November last year, within one week of him moving the house was broken into, stove and electric gate motor stolen. I then had to pay security to stay in the house until it sold, its quite a mission coordinating from overseas and very costly, good news is it sold, but still have one more house, the hassles can be too much and there is a lot of unpleasant writing on the wall:fear: But good luck to all.


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## travelling-man (Jun 17, 2011)

Ivapan,

FWIW, on the offchance you bought your house in the name of a CC rather than in your own name, you need to look into the tax situation......... there's currently a tax window open until the end of this year where you might be able to transfer the property out of the CC and into your own name and avoid capital gains tax.


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## Daxk (Jan 20, 2008)

travelling-man said:


> Ivapan,
> 
> FWIW, on the offchance you bought your house in the name of a CC rather than in your own name, you need to look into the tax situation......... there's currently a tax window open until the end of this year where you might be able to transfer the property out of the CC and into your own name and avoid capital gains tax.


only if its your primary residence. AFIK.


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## travelling-man (Jun 17, 2011)

Yes, that's correct. My apologies for not mentioning that......


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## gerhardme1954 (Jul 6, 2011)

One should not allow rumours, or rumours about rumours to influence the situation. The discussion on Nationalisation in SA has nothing to do with residential ownership. The important question is. Are you coming back, or is their a possibility that you will come back? If the answer is yes, keep on renting it out. Its performance has to do with how good an agent you employ, nothing else. The risk of this is minimal. In 5 years time you will need to buy it back at twice the price. If you do not have any intentions of coming back, hold onto it for another 12 to 18 months, then you should be able to sell it at the best aggregate price for the forseeable future. When dealing with property think like an economist, and only look at the facts, not the stories.


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## Daxk (Jan 20, 2008)

Yes Gerhard, and right now is not a good time to sell either.

I also very much doubt that there would EVER be Nationalisation of private Houses in SA, or even land redistrubution of houses on Half acre plots.

I dont think that's what we were discussing, merely the practicalities of renting a property as an absentee landlord.

as to 18 months, I sincerely hope so.


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## bokbabe (Nov 28, 2010)

Ivapan said:


> I would like your advice on whether to sell or rent my cluster in Johannesburg. After living for 10 years in South Africa, I'm moving back to Bulgaria and can't make up my mind on whether to sell or rent. I am very worried about the political situation when it comes to properties and all the talks about nationalization. If I rent, the rental income will cover all the expenses and the bond. However, I'm worried about the additional future costs, i.e maintenance issues. Have any of you experienced a similar situation?


Hi Ivapan

Whereabouts in Jo'burg are you? I am in the industry and may be able to suggest a good agent in your area, to help you sort the wheat from the chaff a bit quicker!

Good luck with your sale


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## vegasboy (Apr 28, 2010)

I cannot agree more with all the above. I wish I had the insight years ago when I invested in apartments. Regardless of what area your property is in, the current upcoming middle class in general just do not have a paying culture.


I just returned from the US, where (in Florida) you can buy a 2/2 condo with all appliances in a nice area, well maintained with tennis courts, swimming pool and low HOA's ($200) for about $40k and rent it out for $650 unfurnished, with a much better paying culture than in SA

I'm holding on for a while, hopefully another 2 years for the SA housing market to rebound, and then I'm SELLING and investing abroad and lane:.


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## EthenGroom (Feb 1, 2011)

*To Rent Or To Buy*

Hi

It can be to your advantage to rent in a market of softening yields. Meanwhile there is also support for owning your own home, not least because of the psychological value. you should be aware that the anti-avoidance provisions (known as Part IV A) of the Tax Act can prevent you from obtaining tax benefits if that is the sole or dominant purpose for entering such a transaction. Make sure you get good tax advice before pursuing such a strategy. Of course when it comes to the home you own and live in, you miss out on rental income and only get a capital gain. So the more expensive the home, the more rental you will be missing out on because you are living there. Over a lifetime this can be quite substantial.


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## Daxk (Jan 20, 2008)

EthenGroom said:


> Hi
> 
> It can be to your advantage to rent in a market of softening yields. Meanwhile there is also support for owning your own home, not least because of the psychological value. you should be aware that the anti-avoidance provisions (known as Part IV A) of the Tax Act can prevent you from obtaining tax benefits if that is the sole or dominant purpose for entering such a transaction. Make sure you get good tax advice before pursuing such a strategy. Of course when it comes to the home you own and live in, you miss out on rental income and only get a capital gain. So the more expensive the home, the more rental you will be missing out on because you are living there. Over a lifetime this can be quite substantial.


Ethen, how long to evict a non-paying tenant?


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## Pfavero (Jul 9, 2011)

Hi,
I am for NOT selling. Perhaps you can think about it once your are away, always time to sell everything. 
When I left Italy for Tunisia I rented my appartment thinking that should I need it it was there for me. At least I covered all costs.
How strange, I lived in South Africa jfor 25 years. I left in 1985 and I have now been living in Italy for 20 years.
All I want nowadays is to find a better place to live and get rid of this crisis that is driving us all to poverty.


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## Daxk (Jan 20, 2008)

Pro's and cons:
It depends on so many factors, how old is the property,how much do you owe on it, what can you buy with the money where you are going?

I rented my place in SA when I left 9 years ago, it was older, paid off, and at the time, with Ireland in a boom,the proceeds would have bought me a two bed flat in the country.
At the time, rentals in Ireland, in the Country were cheap and my Remt less management fee and 15% Contingemcy for repairs, paid my rent on a similar sized 4 bed 4 bath lounge,Family Dining,conservatory etc on half an acre, apples with apples.
I figured I would wait to buy as most property cycles tend to run in 7 years spans, repairs and one bad tenant for 3 months means that my "house"in Ireland has cost me in total about 500 Euro over 9 years.
I am now selling in SA , to buy a smaller retirement home in Ireland.

Emigration/New Countries/challenges dont suit everyone, you may well fail and return, if so, you are back where you started as opposed to having to rebuy at a higher price,transfer fees etc.. also, the place you initially want to live might not be ideal iro of schools , lifestyles etc.. most Saffas tend to try and live as cheap as possible initially and often end up with communities that they would have looked down on before.. 
so. my advice is rent for at least 3 years, then decide.
leaving SA and moving to Ireland was the best thing I could ever have done for me and my Family.

But a lot of people did tell me that I would be living in a old two bed council flat with crappy neighbours 
the van was a local lad who had too much too drink, I live in the house on the left.


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## Aadela (Jul 18, 2013)

Rent


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## shantelW (Jul 31, 2013)

Yes, i would suggest selling, we sold our home in johannesburg when we moves to the states


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