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Marloth Park Property - Investment analysis of Holiday Home
Is Marloth Park a good consideration for buying a holiday home with the view of at the same time doing a good investment?
Properties in Marloth Park compared to places like Pretoria and Cape Town is very cheap. But then again work opportunities in Marloth Park are few and far between. The internet is changing things though as well as the attitude of people, not being bothered on the 4 month max stay rule in place in Marloth Park. (This means they are willing to buy a property with a view of full time occupancy even if "rules" prohibit permanent residency with prior application. For some important to retain the Holiday Township Character and for others bullshit as they paid for the place so...This will be discussed at another time...For now its about money and your investment in Marloth Park.
Currently 3 bed holiday home is for sale for R710,000 in Marloth Park.
Based on above I have made a few assumptions and the purpose of this blog post is to get some comments on how best to analyze this property as a possibble investment. To do this I have assumed different occupation rates on a 360 day year. (Just for good measure i deducted 5 days from a normal year). By relevant costs I only included costs that can be directly attributed to letting this property as a self catering holiday home. Expenses like rates and taxes are fixed and needs to be paid anyway which is why it is excluded.
I need to audit my analysis and I will ask for some input from friends in the industry.
Questions I have include:
Banks are not easy to get finance from so I assumed a decent deposit and a bond of R500,000. This would only be relevant if you need to finance a property like this. I dont know if banks easily finance wooden homes. I do know that the overriding factory for banks these days are affordability and security.
Below is my first attempt at doing a financial analysis. (I have taken information which was shared freely in the public domain (Facebook)). I hope i dont insult the people who posted the advertisement but maybe even help them find a buyer quicker. I do think its a bargain, especially if you are a cash buyer and have a proper marketing plan.
Please provide me with some feedback and I will adjust this analysis accordingly.
Property in Marloth Park so appreciate yearly due to factors such as inflation as well as supply and demand . The last bit can be influenced by how well Marloth Park is managed , which is why supporting the MPPOA can be important.
Please comment below and help me do do a better analysis . (This was my first attempt and I have a full time job besides running this websites hoping to make some pocket money.)
If you require a similar analysis (short business plan) or website please contact www.francoismarais.co.za
Based in Somerset West but almost always online as well