Why YDL currently has a direct presence in the US for now, and what this means for you as an investor

Deon-PicDeon from YDL Property Investment departed for Atlanta in the US last week for a few months in order to bolster YDL’s direct presence in Atlanta. This was a big decision for YDL Property Investment to make, and of course, a big move for Deon himself to make.

What was the basis of this decision?  There were five primary considerations:

1.        The speed at which the US market is moving

As YDL Property Investment has been highlighting over the past months, the US market is not going to sustain the incredible returns that we are seeing now. The market has already recovered to a large extent, meaning that whilst it is still attractive for investors, more so for South African investors looking for a dollar-linked investment, the amazing deals that we saw even a year ago are becoming increasingly difficult to find and secure.

One of the reasons for this is the entrance of large-scale players, such as hedge funds, into the residential property market. Their presence is driving up property prices, but that’s not to say that excellent opportunities are no longer available.  They are, but it is requiring more time and effort to find and secure them.

Given how fast the US market is moving, YDL Property Investment believes that having a direct presence in the market for at least the next few months will enable increased supply and delivery of product for our South African investors.

2.       Increased local market knowledge

This links to one of YDL Property Investment’s Eight Golden Rules of property investment, namely that you can beat the averages if you are a niche expert. Our research showed that investing in Atlanta would have a high probability of giving decent yields at affordable prices, and we thus decided to become niche experts in this market, as opposed to a “shotgun approach” (focusing on multiple markets).

This is why we established an office in Atlanta in the US about a year and a half ago, partnering with local property experts in the US. Deon’s presence to the US further reinforces this.

YDL Property Investment’s recent move will enable Deon to invest quality time working with our team there in order to increase our opportunities in the right areas and at the right returns.

At the same time, Deon will keep an eye on new markets and new opportunities as the property market is dynamic, and as the opportunities in Atlanta will become less attractive at some stage, compared to other markets (see point 4 below)

3.        Increased speed of decision-making

There are some real property gems available in the US market, and it’s really important for YDL Property Investment that as many of these opportunities as possible are secured. Running businesses across continents can translate into delays in decisions, due simply to factors like different time zones. Now, the US team can simply walk into Deon’s office and opportunities can be decided upon there and then.

4.        Uncover and explore new opportunities

As mentioned, the US property market, specifically the dynamics of the buy-to-let market, is changing very quickly. New and large entrants are buying up supply, and forcing price increases. But, this doesn’t mean that there aren’t other opportunities in Atlanta and the US that aren’t worth exploring.

For example, YDL Property Investment is currently carefully considering expanding its property development ventures. As you would have seen from the articles that we have written and published on our website, plus those that we have posted on Facebook, Twitter and LinkedIn, there is a shortage of properties in the US, given the low levels of building activity over the last few years, and the demand by the American public for homes. This makes the prospect of development very attractive and Deon’s presence in the US will help us in exploring this opportunity.

5.       Peace of mind for investors

Even though YDL Property Investment’s owners are Directors of its US-based business, it’s reassuring to know that someone we’ve met and known here in South Africa is directly taking care of our investment interests in the US. Deon has extensive property investment experience, understands the specific needs of South African investors, and his presence in Atlanta will give greater peace of mind to investors.

The question of course is how long Deon intends staying in the US?  The answer will depend on what happens over the next few months. If YDL Property Investment sees that Deon’s presence in the US will make long-term business sense, then we’ll work towards making his move a permanent one. If the business will no longer require his direct presence, Deon will return to the local South African office and manage the US operations from our home base.

Whatever the final decision may be, it’s certainly an exciting period of time for YDL Property Investment.  We are confident that this move will assist us in offering an even better investment opportunity and service to our investors going forward.  If you’re ready to take advantage of these opportunities now, get in touch with us here.

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