Weekend Argus (Saturday Edition)
To sell or let if you’re planning to leave
IF YOU have decided to emigrate, you probably need to sell your home to help pay for this huge move. But if you don’t need to, you might want to hang on to your property here and rather let it.
This option not only gives you back-up in case your overseas venture does not work out, but also allows you to use the property as a holiday home or even one in which to retire.
The choice of whether to sell or let – for those who have that choice – can be a difficult one. Andrew Golding of the Pam Golding Property group says there is no one-size-fits-all answer.
“It depends on the individual’s assessment of a number of influencing factors, personal circumstances and choice.”
The experts have some advice:
LET IT GO
Although your decision depends on your financial health, Rawson’s Craig Mott says, in some cases, it is advisable to sell as emigration is already a stressful process and liquidating assets can go a long way to sustaining you through your first year or two in a new country.
“It can also be financially and emotionally distressing to a family/person if they need to spend money maintaining the property.
“If they do not have a trusted agent on their side then they will need to manage tenants on their own from afar and that can be difficult when regular inspections need to be done or when dealing with a defaulting tenant.”
Chas Everitt’s Berry Everitt agrees the best choice is to sell.
“It’s difficult enough to emigrate and adapt to a new life without having to worry about a property in South Africa, what your tenants are doing, and what problems there may be in terms of erratic municipal services, even if you have an excellent rental property manager.
“If you really want a rental property, rather buy one close to your new home.”
Besides, he says, the past two years have not been kind to the rental sector.
“Many tenants are still behind on repaying the rent deferrals granted during the Covid-19 lockdowns and, according to the latest statistics, only about 80% are in ‘good standing’.
“What is more, about 72% of landlords had to settle for lower-than-usual rent increases last year – and that is unlikely to change this year because of the rising cost of living.”
From the property group’s perspective, it is also becoming difficult to find quality tenants.
“We have strict income, employment and payment-record verification procedures in place to protect our landlords and, in some areas, up to 70% of prospective renters are not making it through these checks.”
HANG ON TO YOUR HOME
If you do, however, want to keep your property and let it, Everitt says you should never try to manage your property from a distance without the help of a qualified, experienced rental manager.
Mott says you also need to prepare in advance and take care of property repairs and maintenance issues before the property is let and ensure that you keep in line with rental pricing trends.
“Get your rental property valuated by a rental agent, and market it in accordance with that.”
Furthermore, if you are letting your home fully furnished, you need to prepare an inventory of all the furniture and equipment and the tenant needs to sign acknowledgement of the inventory.
“Like any other investment, the key lies in intelligent asset management,” Everitt says. “Having a rental expert on board can help minimise risks and maximise returns in the long term, allowing a stress-free rental.”
HURRIED DECISIONS
Whether it is better to sell or let your property will also depend on the urgency, says Seeff’s Samuel Seeff.
“There is adequate demand in the market in most areas to be able to sell, especially in the price bands below R2 million, so you should be able to attract offers, provided the property is priced in line with the current market.”
A difficulty with keeping a rental property when you emigrate, he says, is you are not here to look after it. “But a good rental agent can assist.”
If you need to sell your home quickly because of relocation deadlines, Mott says the key factor is pricing, so start off with a valuation and then ensure your property is priced correctly to sell.