Investing in real estate… Is it the right time?

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Here is a question which will resonate for ever in the the real estate industry: is it the right time to invest? Whether you want to buy a secondary home, a plot of land to build your dream house to benefit from a profit on resale, or enjoy rental earnings on an apartment, three experts will help you have a better insight on the question.

Investing in real estate: the on-going dilemma

When it comes to investment, there is no doubt the Mauritian real estate sector remains a safe bet. However, assessing your options before getting into it is a prerequisite as well.

Get a glimpse of heedful advice from qualified professionals to help you in your decision making. To puzzle out this dilemma, we asked our collaborators 3 questions:

1. What are the best investment opportunities for 2019? Apartment, parking, land (agricultural or residential), house, etc?
2. What are the most profitable products, offering a better rental yield and/or added value?
3. Is it the right time to invest in real estate?

HERE IS THEIR ASSESSMENT>>

Severine Dalais- Pietersen - Administrative and Marketing Executive, Seeff Properties

It all depends on the type of buyer we are talking to is. For instance, if a Mauritian is looking for a return on investment, purchasing a plot of land in a secure morcellement can bring a profitable rental return in subsequence of building a house… It is also the case when buying a beachfront apartment in a well-crafted project which offers rental management. Furthermore, investing in small villa projects under the price range of Rs 10,000,000 is the big trend 2019.

Whether it is a secured land in a morcellement, an apartment by the sea or a small villa/townhouse in a secure development… at the end of the day, the most important aspect is the geographical location of the property. The key cue remains investing in the right region so that it gains real estate value. As the motto of real estate echoes: location, location, location!!!

2019 promises to be more complex than 2018, which had been a great year for us. Unfortunately, more and more products are being sold at prices exceeding our estimations, and consumer demand. It goes without saying: this problem causes some turmoil on the real estate market. This may result in a drop of selling prices at a certain point, and as a result, we believe it shall be a good time to invest in landholdings. This being said, Mauritius is a small island and the value worth of land always increases… Landholding investment remains a safe one as long as the acquisition of the property is well thought.

Corine Legrand, Real Estate Advisor for sale, Nestenn

Being a versatile product, for me, land shall remain a great investing option; having an ascertained added-value, whether for pure resale or with a home. For a purely rental investment, I would recommend investing in a well-situated house which has a potential: renovating it will highlight the spaces available facing outwards, such as enhancing a terrace and breaking down segments, in order to offer even more open spaces and rejuvenate the property.

The real estate industry remains a very dynamic one… Prices have constantly been increasing during these past years due to a transformation of the Mauritian society, along with a growing aspiration of accessing property amongst youngsters - with the help of the government’s boost: the ’First Housing’ Scheme. Despite Mauritius being geographically limited, its prospective regions remain an interesting option for investing.

Philippe de Beer – CEO, Park Lane Properties

When one is well advised, investing in real estate remains a safe bet in Mauritius. While property prices continuously grow at a steady pace every year, it ensures each investor a gain of an average of 3 to 4% of its value per annum. However, we have witnessed as well some property values increasing by a more than 50% over two years (construction period) for certain off-plan cases and exceptionally well-located developments (beachfront or sea-view properties for example). An off-plan purchase usually allows the buyer to obtain the best capital gains over time, especially when the project is being developed by a serious promoter who has a portfolio of successful projects.

Investing in agricultural land however needs to be more thoughtful. Land location shall determine whether there is hope for an interesting value appreciation with time. Sometimes, the agricultural land’s value worth can double, all depending whether it is located on an important road or a remote area. Everything depends on how accessible it is and the future developments in that region. Being well advised is a requisite to avoid mistakes and being patient is even more important; wait for the land of that region to increase in value before investing to yield an added value.

Very few people consider investing in commercial properties, yet it can become a very lucrative one.

The first benefit is that some commercial properties are specially designed for smaller budgets. Second advantage: the rental return can be very interesting. In fact, its profit exceeds that of a residential rental return by far.

In many ways, investment in the residential sector prevails as an interesting option, notably if it is done in a strategic region (the most solicited areas for rental investments are currently the coastal regions in the North, in Tamarin/Black River, and in some very specific areas of the center of the island such as Moka, Ebene and Trianon.)

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