Listed property more liquid than buy-to-let investments - CNBC Africa

Listed property more liquid than buy-to-let investments

Southern Africa

by Trust Matsilele 0

Listed property more liquid than buy-to-let investments. PHOTO: Getty Images

“There are assets as an individual investor one cannot have access to but listed property affords an investor with that access,” Kundayi Munzara, director and fund manager at Sesfikile Capital told CNBC Africa.

“You also get top management with a hundred per cent dedication to managing these assets which includes managing directors, chief financial officers among others,” he added.

Munzara noted that listed property had done just under four per cent this year while, equities had done about 7.8 per cent demonstrating how well listed property has been performing.

(READ MORE: Listed property accessible easiest through unit trusts)

“The real issue is the tapering that’s happening in the United States which is affecting all interest rates sensitive assets consequently affecting listed property.”

“The real question that investors should have is the underlying operations and from where we see the operations are fine,” he posited.

Munzara said, listed property was currently giving investors a 7.6 per cent yield growing at 8.5 per cent for the next two years.

He also posited that the real issue was how sustainable and how riskier earnings from listed property were for an aspiring investor adding that most of those earnings were backed by strong leases to strongest companies.

“Once you have made a decision on what kind of investment one aspires it’s imperative to speak to a financial advisor.”

According to Moneyweb report, the sector is expected to see a number of new listings during the year since the new South African Real Estate Investment Trust (REIT) will offer significant tax benefits.

According to the 3PM Investments, the South African listed property sector consists of fice Property Unit Trusts (PUT’s) and 20 Property Loan Stocks (PLS’s).

(READ MORE: S.Africa to see more sector focused listings)

"These are companies that manage a portfolio of properties, across the various sectors of the economy – retail, office and industrial. There is a very small residential component." 

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