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30 Mar 2015


I will never exhaust the topic of preparing a property for rental but I can always share a project of my own. This is my latest property renovation which is now tenanted, thanks God. This is a 4 bedroom, now 3 bathroom family home with servants quarters that house their new full bath.
Apologies in advance for the possible slower loading of this post due to the number images.
Rental Property Kitchen
I never took the picture of this kitchen in a good light day. The wall tile is the nice shiny glass mosaic one. A good tile can make or break the kitchen. Rather use the tile minimally and buy a great looking one. Most people's choice to rent of buy a property is influenced by how the kitchen looks.
Below is how our kitchen looked when we bought the place. We followed the layout of the original kitchen to save costs on plumbing and electric wiring. Besides, a kitchen this narrow is not easily maneuverable.
Preparing a Property for Rental
Nothing was good enough to be reused in the old kitchen. This is a typical galley kitchen; quite narrow but long enough to give a lot of storage space. There is a separate laundry area on the other side too. It is so worth it cleaning up the kitchen and bathrooms. You don't only get a tenant quicker, but increase the probability of getting a higher quality one too. The more the applicants, the better the chance, right!
Bathroom of a Rental Property - before
I could not add more photos of this room than necessary, but this was a guest toilet without a hand basin. We added a corner basin as space in this bathroom is an issue. That took it to an ideal 3 full bathroom house. And South Africans do love their bathrooms in numbers. Two bathrooms are viewed as minimum but throwing in a half makes your property more marketable. Modern houses usually have the equal number of or more bathrooms than bedrooms. OBSESSION!
Bathroom Remodel Project
This is definitely not a fancy job. I sniffed loads of dust in this process. Remember I am hardly ever on site when this happens but I still feel it. Replacing tiles, basins and toilets with better looking and modern ones increases the marketability of your property.
Cleaning the Bathroom up for Rental
Always remember to go towards neutral colours. Can you spot a white dado rail disguising an uneven wall but also serving as a nice trim? It is far cheaper than re-plastering the wall. You need not break the bank when preparing a property for rental. A can of paint will always up the value of your property.
Recycle when Remodelling
 I personally spray painted my old wooden curtain rails to reuse in this project. I would have used a nicer looking rust-oleum if the dark stain one was in stock. These had to be left to dry outdoors overnight. Did I mention how much I saved by reusing these old rods? I also used existing metal rails. I still wish I painted those in black.
Now to the really scruffy part of the project.
Fitting a Shower in a Small bathroom -before
Yes, this is the "before" of an outdoor toilet in the Servant's Quarters. The tenants in this area insist on a fully usable SQ bathroom. And as we all know, what the tenant wants, the tenant gets. I had a number of hand drawn ways to fit a shower in this tiny one metre wide toilet. At the end, I had to have the basin inside the shower.
Preparing a Property for Rental - shower fitting
 Exciting to see that everything is fitting nicely. I bought the smallest of everything. That basin is the tiniest. We couldn't even get a mixer that fits in the middle. Did you notice that the mixer is on one side of the basin?
Adding a Shower in a Tiny Bathroom
Space this small is better off tilled from floor to ceiling and on all walls. This addition was made a little expensive by the fact that water drainage pipes did not exist anywhere close to the space. We had to drill and add pipes inside and outside the room.
I never took the "AFTER" photos as this room was completed the day the tenant moved in. In my defense, they moved in a few days earlier.  And finally...
Securing a Rental Property
 Sadly, the cost of security is what we cannot escape. This house is made of glass doors. All bedrooms and living areas facing the swimming pool open up to it. I loved these vintage doors but they cried "restore me". Trellis are also not a bad option as they completely slide open during the day. That's how I go about preparing a property for rental. Now to the business side of things.

Why We Bought this Property
  1. This property is in a street that is fast becoming a business street. Across the street are mainly offices, doctors' rooms, a garage, and the like. It is also in close proximity to restaurants and a shopping complex. What is even more awesome is that it is a walking distance from my home. We have plans to turn it into a commercial property in a year or two.  
  2. I know I am a location freak but this was an additional strength. There is a reasonable demand for property of this nature in this suburb. Most of the house viewers were corporate clients for their expatriate families.
  3. Family homes like this one have to be very close to schools and most recently in Gauteng, Gautrain stations. A number of people commute between Pretoria and Johannesburg daily. This house gets a tick on each of those.
  4. I am sort of transitioning to this kind of market specialisation. The plan is to limit the scope to semi or fully furnished corporate homes. This will further limit the quantity of properties I manage (when I start self managing) but hopefully increase the quality and returns. 
  5. The price was right. When I first saw the listing which only showed the back of the property, I called my agent to investigate who the owner was and get the property for me. This was done in a day. It was quite cool to get interest from buyers after the clean up, but we are not property flippers.
I enjoyed this project but it took longer than planned to complete. I am already craving something new to work on. I tend to feel idle in between projects. The life of a serial renovator can be exhausting but definitely exciting. What do you think of my minor renovation?

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23 Mar 2015


A lot of us want to start investing in the stock exchange like the Johannesburg Stock Exchange (JSE) but are held back by fear. The thought can be quite overwhelming. No surprise there though; a whole lot of things look scary from the outside. Let us try to unpack the basics of trading in stocks, equities, shares or whatever else you prefer to refer to it as.
Trading in Stocks
I know, I'm back with examples that most educated people find undermining or patronising. Reason being that I am explaining to the reader who is like me when I started out. I was really that bad, and worse. This is what stock trading does and does not look like:

  1. You start a restaurant that specialises in chicken meals. You need capital, some skills, time and the practical know how. The returns on your investment will be referred to as profits. This is a real brick and mortar physical business and obviously not any form of trading in stocks. 
  2. The alternative is to buy the shares of an existing popular chicken restaurant, which makes you an owner or shareholder of a piece of that restaurant. You may be owning a tiny fraction of the percentage but who cares. Your concern is whether your fraction is growing, stagnant or shrinking. You also have a responsibility of reading and following the progress of the restaurant. When it does really well, part of the profits are shared among the shareholders including yourself. This share of profits that you get is referred to as a dividend. Dividends can be an amazing way of diversifying one's income. The higher the number of your shares, the higher your dividends. Also important to state is that, in an event that the company goes bankrupt, your loses are only on what you have invested and never on the assets that you own outside of your stocks. And this is trading in stocks or equities.

Companies that are publicly listed in the stock exchange do so to raise funds that are used in growing and in the running of those companies. Whilst as a shareholder you become a part owner of a particular company, dividends and share growth are never guaranteed. There is an element of risk, especially in the short term of the share ownership. In the longer term the performance of one's shares are more likely to yield higher returns. Pointing you to the name of this blog; safe investing is never a rushed process. It requires a lot of patience.

If you have been with me for a while you may have stumbled on the post on balancing your portfolio. Trading in stocks can can be one of the building blocks of a balanced portfolio. The main advantage of trading in equities is in owning a number of businesses without owning any of them. English can be fascinating, don't you think? Whilst shareholders don't wake up to go to the business they have invested in daily, share trading is not passive in any way. A more passive kind of investing in shares could be an investment through the Exchange Traded Funds (ETFs). Even that cannot be classified as passive because an investor is expected to make some effort in getting a deeper understanding of what is happening in the market. With share trading one needs to follow the company news and the economic or finance news daily. Markets can go crazy in a matter of days or hours. Despair not though, you will love following news when you start trading.

I would not see trading in stocks as a "get-rich-quick" scheme. It is possible to get lucky and make a lot of money or lose it in a short space of time. I so hope that your main goal is making some money constantly without a rush of a gambler. Like most investment vehicles, equities require some patience. One has to save and keep liquid money at hand to buy at the time they see as perfect. The timing is usually determined by the price changes. We buy at low rising prices and sell at high prices.

The trading happens at such a huge scale that it is easy to be ignorant to the fact that there is a willing buyer and willing seller setting the price on the market. The most popular form of trading is done electronically, of course. The stock price that one sees is the one determined primarily by the willingness of the millions of buyers and sellers to act, which is also referred to as demand and supply. A number of events in economies influence this demand and supply. As Economics101 states, high demand will lead to higher prices whilst the high supply reduces the stock prices. This is what is the basis for your trading decision making.

Before taking a decision to invest in a particular stock, you look into the ins and outs of that particular company. What the company does; how it operates; who runs the company; how profitable it is; how much it grew in the past; how is the competition; what is its strategy; etc. When a company gets some sort of negative reports like their product usage getting reduced because of competition, its demand will shrink and so will its share price. This is one of the reasons that the stock traders read and listen to business news. In reality they get paid for following business news. An investor cannot afford to be lazy to hunt for and consume information. And luckily for our generation, information is readily available in print, audio and on visual media. One does not even need to hire an expensive full-service brokerage to manage their trading activities. A lot of companies, including banks, offer cheaper DIY trading platforms.

The Bulls vs the Bears:

You have probably heard of the bull and the bear markets. A bear market is when a lot of the economic indicators are looking bad. This is like the recession market. During the bear market, one needs to time the buying and the selling to make some profits.
The bull market on the other hand is when the economy is looking good. It is an easier time for trading in stocks. An investor needs to have a strategy to deal with all kinds of markets. In the long run, markets have a way of evening the loses and gains out.

  • Trading in stock involves brokerage fees which can be costly. Compare the costs and commissions of available trading platforms. I personally use one of the banks which I found not to have high costs.
  • Nothing takes the place of thorough research and staying informed. Know your economy well enough to be able to pre-empt its changes. You have to know where you are going and how you plan to get there. You also need to look at the trends for a specific target sector and each target stock within the sector.
  • If in doubt, start with the Exchange Traded Funds (ETFs) where a broker takes a whole lot of responsibility from you. You may take that time to learn the trading ropes from forums, books and some websites.
  • Learn about the risks. And YES, it is possible to lose everything you have invested. It may not be likely if you are not trying hard to beat the market, but it is a possibility. Remember that this is not the gamble, its an investment. Starting with good quality growing companies could be a much better strategy. Whilst small caps can be lucrative, they carry a bit more risk.

I have been away for more than a month. After traveling for a few weeks I came back to my last renovation project. I was exhausted to the point that my doctor ordered me to get rest. As soon as my tenant got settled, I gave myself almost a full month rest from writing. I don't like that, but it was necessary.

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