The Best One can do Now !

  The best one can do now is hold onto sections of stocks one knows are going to be needed in future to supply the needs of the world popula...

About Me

Retired but always looking for new challenges.

3) Real Estate , 2023 Update December 2023



Remember that Property unit Trusts and Loan stock produce mostly interest and are there for taxable. As the interest income increases over time the capital value also increases,but at a slower rate than other stocks.


READ BELOW TO BETTER UNDERSTAND PROPERTY

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2023 First quarter.Remember that       Property Unit Trusts and Loan Stock can be bought and sold literally "At the drop of a hat" i.e. very easily!!!
Not that one should do that as they should be kept as a longer term investment.
   Their interest is usually fully taxable ,although the advantage of holding that instead of personally owning property to rent is that,one does not have to deal with the hassel of non paying tenants,rough residents that partly destroy your property ,muncipalities deming more rates and taxes etc.
The listed companies are mostly of high standing and most of their tenants are of the best quality in the country and overseas. 
Do read the rest of the column below to obtain the full picture. 

2022 September to December interest rates are increasing inline with inflation. Time to start buying Unit trusts & loan stock !

2022 July to dec update.
Since the start of the European war ,it would be best to rather buy SATRIX PROPERTY as a fair amount of the REAL ESTATE INVESTMENT TRUSTS have property in Europe and we do not know how safe these investments will be. Our own market has stalled and prices for properties here are going down. 
Best is not to try to profit off the war as the whole world will be effected!
If in REITS already just hold or change to SATRIX PROPERTY as they are likely to be more nimble than private stock owners. If thinking of buying ,in our opinion now is not the right time to purchase.

FROM JANUARY TO JUNE 2022
RECOVERY IN THE REALITY MARKET IS SLOWLY GAINING GROUND. 

WE WOULD NOT WANT IT IN ANY OTHER WAY AS THE PROGRESS IS THEN LIKELY TO BE MORE PERMANENT.

BEST TO CONCENTRATE ON STOCKS THAT SERVE NICHE MARKETS NOW,SUCH AS STORAGE FACILITIES ,ALSO REALITY STOCKS  THAT HAVE AN OVERSEAS COMPONENT. 

IF AT ALL UNCERTIAN DO TAKE SATRIX PROPERTY WHICH IS ON THE BALL AND SAVES THE INVESTOR FROM MAKING WRONG DECISIONS.

REMEMBER PROPERTY TRUSTS AND LOAN STOCK , ARE MAINLY ABOUT INTEREST INCOME,WITH CAPITAL GROWTH PLAYING SA SECONDRY ROLE.




FROM MAY TO DECEMBER 2021

NOVEMBER UPDATE. 
NOW POST MUNCIPAL ELECTIONS, IT WOULD SEEM A GOOD TIME TO PURCHASE LISTED PROPERTY.
Always remember listed property is better than indvdual owned property , as ut is easier to get out in a bad situation etc!
there is now more interest in REITS  AND PRICES ARE INCREASING WELL AT THE MOMENT.
If you have no knowledge of this sector and are unsure of what to purchase there is always SATRIX PROPERTY which can be obtained from any stock exchange broker or ask ABSA directly how to purchase. One holds property for income increase mainly over time and secondry for capital gain over time.
If you are a DIY person do include RDF,VKE,AHAand AHB in your portfolio. 
Always good to read below all for more info.

Cheers Barry
SEPTEMBER UPDATE 2021
In our opinion  this is the best time to buy local south african REITS (Real estate Investment Trusts) 
They are easy to move in and out of if circumstances demand it. Do remember they always do better over the longer term and that the income is usually seen as taxable as it is seen as interst income.

Office space is now falling out af favour and might never regain its true value . If how ever this can be converted into smart  upper class accomodation then choose those REITs.

Do yor own research it will be worthwhile.
Also look for niche REITs such as storage units and industrial space overseas Reits that are growing.

ALSO READ BELOW FOR MORE BACK GROUND INFORMATION

JULY  TO DECEBER 2021


How ever  listed property stocks always remain a far better than holding the actual single property.
Our lockdown has gone on far  too long locally and therefore local property stocks will definitely find it difficult to find good paying tenants for the next couple of years. Our advice is to look for overseas listed properties such as SIRIUS etc. 
Buying further local listed properties should be delayed as prices will at best stay static until a genuine rcovery takes place. Read all below as well.

January to June 2021

  Read the report of the last six months to see the reasons why conditions stay tight.
To look on the bright side there are always chances of succeeding in any market wether prices overbought or underbought.Property stocks have fallen another twenty percent in capital value ,although income from the unit trusts and loan stock have only gone down by an average of 5%.
  Do your own research before trading as those we mention are only our own opinion!
  THOSE SHOWING GOOD GROWTH AND WORTH A PUNT MIGHT BE NOW:-
EMI, EQU,L2D,SRE,SSS,VKE,SAC

RECOVERY STOCKS:- RDF,HYP,GRT.

NICHE STOCKS SUCH AS INDUSTRIAL AND OVERSEAS HOLDINGS CONTINUE TO DO WELL.
 NAOMI(My wife) has just bought SSS as storage units are relatively new to us in South Africa. Think she has been watching Storage wars etc on TV! Industrial stocks have done very well in Germany as well. namely SRE.

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JULY to DECEMBER 2019
1.Over the last couple of years listed real estate companies and mutuals capital growth have fallen by an average of about twenty four percent.
One of the causes has been the unrest in the economy caused by graft in the government and subsideries from the top right down to the bottom in the form of muncipalities. Lots of comissions of enquiries etc. ,but no arrests as the ruling 
ANC is afraid of losing votes,lots of threats of course of land grabs with out compensation! 
The ruling ANC has in its last 25 years found it difficult to make the transition from a revolutionary movement into a legitimate ruling party. They still appoint Cardes to posts even when they are not qualified for the specific job they have to do. whole sale steal of electricity monies have led to towns been cut off from  electricity supply as most muncipalities are now bankrupt, easy Targets are the real estate aaaaa investment trusts and rates are increased whenever they start to make a profit.
2. there is an over supply of offices and shops at the moment. The brave can perhaps consider industrial  builings and investments locally.
2.Overseas it might be well worth the risk to invest in the United Kingdom as property there is at an all time low in prices.

JANUARY to JUNE 2019
1.This  past period  for Real Estate  have been ,when both local and overseas prices showed a rather rapid decline of between 15 % and 30 % overall .The decline was cause by more a case of foreboding than actual bad conditions worldwide as it occurred in a time of great prosperity in a market that run well and its known that usually a recession is likely to follow, as conditions are now beginning to become dismal. This might not be the time to enter into new deals as prices might drift in a regressive manner for at least the next six months. How ever bargains are starting to occur in good stock and the market can be watched.
2. Do read the last couple of entries below and it might be a good idea to nibble on good REITS as property is always a long period investment spanning many decades!



JULY to DECEMBER 2018
1.PROPERTY UNIT TRUSTS AND LOAN STOCK all now part of REAL ESTATE INVESTMENT TRUSTS (REIT)are usually taxed in the hands of investors as the income is considered interest not dividends.Good idea to clear this up with your tax consultant before buying a specific stock.
2.Every investor should own some property stock or actual property. The advantage of buying on the stock exchange of course is ,especially now in our country, its easily sale-able if politics sends property in the wrong direction during periods of unrest. Another advantages are not having to be involved with lesee's  problems..
3.The in income is slowly increasing on all good REIT's and most are undervalued. If you are holding good. Now need to rush in now how ever a good time to slowly nibble at local as well as overseas properties(In our opinion only)


APR,MAY ,JUN 2018
1.The market is beginning to recover locally but not so well overseas. Beware of property stocks that had cross holdings to increase their  prices such as Resilient etc. They are beginning to unwind these positions so should do better in future.There many tensions overseas so their stock prices reflect this fact and therefore there in practically no capital growth at the moment as well as income from rents slowing down.
2. The extreme wing of the ruling party is talking of confiscation of agricultural land with out compensation and now are broadening this by using the term "property"which is also causing nervousness as no one knows what they mean to include in this definition!. We think this will fade away after the 2019 election and anyway stocks on the JSE are  a pretty safe bet of not been included as any illegal move will be successfully opposed in the constitutional court.
3. Better to stick to PUTS and loan stocks that have good management structures ,such as REDEFINE,GROWTHPOINT,HYPROP ETC.

JAN,FEB ,MAR 2018
This page will in future be published quaterly.
 With the" Ramaphosa influence" the market so long in recession has turned positve. 
1. A great deal can be gained by reading the 2017 and earlier posts on property specificly 
before trading. Only thing we can add a this juncture is local property is coming back into demand as buyers feel more settled as to the safety of ownership.
2.CONSTRUCTION shares should soon be trending and the place to be . 
take something basic such as PPC a cement counter that lost its shine years ago.

                         2017 PROPERTY           
The great advantage of buying property on the stock market is that its easier to sell at market related prices than physical property. 
Another advantage is as one has not to pay for an entire building and can own as small a part as one wishes for. 
In the present circumstances  it is probably wise to make property at least a 20% part of ones portfolio. Of such property held it would be wise to hold at least three quarters overseas. Loan Stock such as RPL is now at very reasonable prices with many pure overseas Property Unit Trusts and Ordinary Property Stock shares. Carefully examine all of these. 
Remember these are long term investments.
On the local scene do investigate property in the industrial sectors as these usually give better returns than offices,retail or home units.
A very good idea is to read all the older posts as they contain much wisdom and do not go out of date esily.


Jul to Dec 2016
The reason one purchases real estate stock on a stock exchange is and has always been to receive a good income .
Now there is conformity around the world with REIT's having come into being with more or less the same rules. Here in South Africa the property unit trusts have and are still taxed in the hands of investors which has the advantage of being a lower rate than company tax for most investors. The loan stock falls under slightly different rules.
Its absolutely necessary to consult a tax advisor so not to run foul of the receiver of revenue.
I purchased the  first PUTS to be launched some 30 plus years ago, they were from SAGE and Standard bank if I remember correctly !
Over this period  the capital side of the stocks increased by about 5% per annum on average and the income averaged about 7%.
A very good income indeed. In about three periods in this space of time the capital value doubled almost every decade during short bursts covering a couple of years. This then leads investors to think this real estate is the same as shares and all in sundry climb in only to be disappointed there after!
Last year many new REITS were listed as Europe and Britain were in such a period of fast capital growth. These REITS have now mostly declined by about 20% plus not helped by negative growth there.
I have sold all these and am concentrating on either loan stock and Puts that are local or hybrid that have a local and overseas content. DO YOUR OWN RESEARCH BEFORE PURCHASING AND REMEMBER REAL ESTATE IS LONG TERM.
IN:     Hybrids I like are now FFA/B,  RDF,GRT, RES  LOCALS , SAC,BWN
OUT FOR ME ARE  ROC,RPL,TEX.
AS ALWAYS ONLY MY OWN PERSONAL OPINION



24/2/2016
REITS are  now fully operational, as its a year since we changed to this format.
How ever  during the last six months all property stocks have virtually been in the doldrums. Now ever local stocks are starting to out perform the most overseas offerings.
The overseas REITs I  feel might be investigating are TEX,RPL,SRE,RES,ROC.
LOCALLY FFA/B,OCT,BWN,AWA/B,SAC
WE HOLD RDF,RPL,TEX at this time.


 
6/7/2015
I have held RDF since it was first listed, how ever I have now sold it as I feel that there too much office space out there. When looking at the local market one should look for niche holdings such as ILU which is concentrating on letting residential property. It is the second trust to do this. Octodec under the Wapnicks have done this successfully for years.
The CEO Gerald  Leissner who has headed Arrowhead gives me enough confidence to buy.
CPF is becoming a pure logistics play and is shedding their office portfolio.
I now hold CPF,RPL and INDU

3/6/2015
There has been considerable churn in the listed real estate markets on the JSE in the past year as the property trusts ,property loan stock and shares all converted to REITs.
 Added to this many new stocks entered the market. All these REITs created excitement and prices moved up to rapidly. One has now to be careful about which one  should buy as some are of indifferent quality. Consolidation is needed.
Overseas REITs are still very popular, but one should be careful about where they are situated. Some regions such former Eastern Europe might be drawn into regional political instability. Then the expected returns on some REITs is so high that they are likely to fall if another recession hits the region.
I MYSELF WOULD NOT TAKE A REIT IF ITS PE WAS ABOVE 20 NOW.
DEMAND LOCALLY HAS ALSO SLACKENED.
REITs I hold at the moment are CPF,RDF and RPL.

I am especially excited about CPF as it serves a niche market, namely logistics. It has terminals in many places and its getting rid other industrial and office properties. There is a simply huge new logistic property being developed in Natal which it will also be part of.




19/2/2015
In these uncertain times, what with the stock markets world-wide at or near all time highs ,it make sense to me at least to have some assets in property companies. It would seem as if our property unit trusts and loan stocks have retained at least for the moment some of their attractive features they had before converting to REITS !
EARING YEILDS AND PE ON 19/2/2015 ARE AS FOLLOWS
EY %      PUTs               PE
15         CPL            7
  8         EMI            12
  6         FPT            16
  4         SAC            21
  5         SYC            17
The interest paid is usually near the earnings yield.
I should think in these uncertain times as our government grapples with land ownership it would be wise to hold overseas REITS as well.
Gains since Jan 2014 are:-
CCO +  6%
ITU  +  9%
MAS      0
NEP + 55%
ROC + 86%
TDH +41 %
A new REIT  is STP and also note that TDH is not a true property company as it has other components.
We personally have around 50% of our portfolio in the property
 sector at the moment. These  are long term holds.
They are:- CPL,EMI,RDF,RPL,ROC.

4/11/2014 Unfortunately in the sector of property where always the very best trusts and loan stock could be found, these days, a great deal of sub-standard REITs are listing! I am at a loss to understand why? All I can think is that they hope to be taken out by the better class REITs at some stage , as it costs a great deal to list on the exchange. In the last dozen new REITs only ATT seems to have any real value.
Since one chooses REITS for a good income stream, it is better to take those that have been around for at least five years and have an increasing income stream. That will then insure that there is some capital growth as well.
The REITs that I hold at the moment are LONG TERM :-
CPF
RDF
RPL
EMI
I stupidly sold ROC and ATT although they are new funds on the block when the market went hay wire at the beginning of October. I shall definitely think about repurchasing them again  in  the near future!

15/9/201 At this stage all property unit trusts and loan stock have been converted to REITS (REAL ESTATE INVESTMENT TRUSTS)
As I have not yet received any yearly financial reports ,I do not know what differences if any or rules relating to will be allowed inside the REIT structure.
How ever I have noted that local South African REITS have been heavily out performed by REITS on our exchange that concentrate on overseas portfolios. This has happened as there is a certain nervousness about the governments policies going forward re land reform. This is quite silly as such measures if ever adopted will be discussed by parliament and then passed. So if  passed would give plenty of time to exit local REITS.
I do remember when the stock LIBERTY INTERNATIONAL before it was broken up before the recession had reached a very high PE ratio. When the recession hit in 2008 it lost about 40%  of its value. The point  that I am making is that most of these overseas REITS are so overpriced that they do not justify the price that is being paid for them now as they are ever unlikely to grow into those prices.
On the other hand there many local REITS covering the South African property market that are reasonably priced. After all ,these days on  the stock exchange its so easy to sell if it seems that legislation that does not suit one is going to be implemented.
HERE IS A LIST OF LOCAL, LOAN STOCK AND UNIT TRUSTS THAT ARE NOW CONVERTED SINCE 9/JULY/2009 AS THE RECESSION ENDED THAT CONTIUE TO DO EXTRAORDINATELY WELL,WITH GOOD MANAGEMENT STRUCTURES-
CAPITAL GAIN TO DATE SEPT 2014
RESILIENT +321%
SYCOM       +109%
REDEFINE  +92  %
VUKILE       +109%
GROWTHPOINT +106%
CAPITAL          +142 %
ACP                    +127%
DO REMEMBER INTEREST RECEIVED WAS THE MAIN PURPOSE OF THESE ISTRUMENTS AND CAPITAL GAIN WAS INCEDENTAL.
A VERY GOOD OVERSEAS REIT AT THE MOMENT  IS ROCKASTLE(ROC) WHICH HOLDS ONLY OVERSEAS PROPERTIES WHICH HAS RESILIENT,CORONATION(INDIRECTLY) CAPITAL,NEPI AND AS STOCK HOLDERS.  ITS PE IS NOW STILL UNDER 12 AT THIS JUNCTURE.
AT A LATER STAGE I SHALL MENTION REITS THAT  I FEEL HAVE GOOD POTENTIAL.NOT ALL THE ABOVE HAVE REASONABLE PE's AT HE MOMENT.ALWAYS DO YOUR OWN RESEARCH AS THIS IS ONLY OUR PERSONAL OPINIONS.



7/4/2014. Really I am having trouble understanding the new designations within the various sectors ,as many different types of property  have been thrown together. There was nothing wrong with our original unique labels, but all the "new" ones was supposedly done so that overseas investors would also understand our structures! New legislation which is in the pipeline might help to make sense of it all!

I bought into the very first property unit trust and loan stock all those years ago so I feel I have a fairly good understanding of property.

At the moment I hold Capital Unit Trust which has a return of 15% per annum interest.
As well as the Redefine loan stock and the RPL overseas share(I think), as I am uncertain if it has shed its loan stock status.


THE NEW REIT(REAL ESTATE INVESTMENT  TRUST) LIST. Not all are in yet so some more might be added in the months ahead. As PUTS  and PLS still within the REIT structure have different mandates read below for info.
In time I hope to list the new REITEs within their types.

SOME INFORMATION ABOUT LISTED PROPERTY.
1.SOUTH AFRICA HAS INSTITUTED ITS OWN REIT(REAL ESTATE INVESTMENT TRUST) REGULATIONS SOME YEARS AGO.THEY WILL SOON UPGRADE TO OVERSEAS STANDARDS.THIS WILL THEN PLACE THE LARGEST PROPERTY TRUSTS ON OVERSEAS INDEXES,WHICH MEANS FOREIGN INDEX FUNDS WILL THEN BUY  OUR TRUSTS.THIS WILL THEN BE A GOOD WAY FOR THEIR MEMBERS TO OBTAIN PRIME PROPERTY IN OUR COUNTRY WITH OUT RAISING THE IRE OF THE GOVERNMENT,THAT WANTS TO RESTRICT FOREIGN OWNERS AS THEY FEEL THEY PUSH THE PRICE OF LOCAL PROPERTY TOO HIGH ,PUTTING IT OUT OF THE REACH OF LOCALS.

2.THESE PLS AND PUTS ARE UNITS AND NOT SHARES AND USUALLY PAY OUT ALL THE RENTAL INCOME WITH OUT HOLDING TAX.

3.PUTS AND PLS (PROPERTY UNIT TRUSTS AND PROPERTY LOAN STOCK) PRODUCES INTEREST INCOME ,WHICH IS FULLY TAXED IN THE HANDS OF THE OWNER OF THE UNITS.NOT IN THE HANDS OF THE COMPANY.USUALLY AN INDIVIDUAL PAYS TAX AT A LOWER RATE THAN A COMPANY ,WHICH IS A GREAT ADVANTAGE FOR RETIREES.


     FOR THE LATEST FIGURES SEE   BELOW:-we take no responsibility for errors or omissions,do your own research before trading

UPDATE JANUARY 2014

PROPERTY UNIT TRUSTS are now coming into their own. Very safe and with some good interest income should be looked at now. The government only favours those that have strong BEE credentials. At this time Captal(CPL) and some others, have used this to their advantage selling off parts that don't meet their objectives, but help add to their capital needs, with out  raising more capital the traditional ways (see units prices below comment)   


When shares performed poorly, bonds and real estate were in vogue ,ratcheting up some spectacular gains, but now shares are coming into their own and the tenuous connection between bonds and property capital gains are supposedly causing them to retreat in price! This is true of bonds, but property should never be bought for the reason of capital gain,but rather the increasing stream of income that can be obtained which out performs fixed deposits and any other income producing item. The capital gain should be purely incidental! Yes they have retreated quite rapidly as the recession is ending, but are now fairly cheap with yeilds between 7 and 14 percent being the norm. Usually the income stream decreases but usually only by no more than a couple percent. This happened after the last couple of recessions. Always go for the more established older companies as their managers know just what to do.

PROPERTY UNIT TRUSTS 20/1/2014
             PERCENTAGE  INTEREST
                       PAYED PER ANNUM
CPL     15%
EMI     11%
FPT      8%    
SYC      8%
SAC      8%

NOTE INTEREST IS FULLY TAXABLE IN THE HANDS OF THE OWNER OF THE UNITS ,WHICH IS USUALLY AT A LOWER RATE THAN THE COMPANY RATE,ANOTHER  ADVANTAGE.
NO FURTHER UPDATES WILL BE MADE BELOW AS REITS WILL NOW REPLACE THESE LISTS.USE THE LISTS BELOW FOR COMPARISONS ONLY.