S.Africans need caution when investing in global property market


“Over 80 per cent of South Africans who invest offshore lose their money,” Scott Picken, founder and chairman of International Property Solutions, told CNBC Africa.

“We have [therefore] developed Global Property System. People make mistakes of using emotions and their feel. They should use their numbers, figures and research before making informed and educated decisions.”

Picken added that America’s property market was therefore far better to invest in as opposed to Africa’s and Europe’s markets.

“European population is on the decline. Population aging will [consequently] influence the fundamentals of the property market in Europe,” he said.

South Africans nonetheless seem to perceive Europe as a property investment prospect for profit, and Picken added that a decline in the rand sometimes prompts South Africans to buy foreign property.

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He explained that some African countries seemed to lack law infrastructure, deeming more reluctance from South Africans to invest in property in them. However, the economic development shown by African countries, such as Nigeria’s GDP growth forecast of 6. 7 per cent, has raised foreign interest in the continent.

Despite the loss that South Africans are believed to making in global markets, Picken believes that there is money to be made in the global property sector.

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“The key to success is the right information and the right partners. There are four pillars to success in our sector. Economics, discount to pricing and property fundamentals of population growth, which affects supply and demand and the rule of law,” said Picken.