Content provided by a guest contributor.
Whether you’re a seasoned business owner looking to move into the property industry, or an entrepreneur seeking to make your name in property, there are certain important considerations to make before starting a property related business.
If you’re serious about investing in, selling, and/or renting property, it’s certainly worth considering starting a property business--even more so if you already own a number of properties. As with any industry though, the right knowledge behind you is vital to start-up success. Keep the following in mind while you do your research and ensure you’ve considered some of the most important facts before starting your property business.
No business is worth pursuing without a business plan in place, and the property business is no different. The plan is a detailed outline of the business model your company will take, who the partners will be, what services you will provide, who your target market is, what funds will be required to start up and grow, and your short-term to long-term goals.
The plan also includes a summary of the market and your competition, and how you intend to provide for the market in a way that will prove successful for you and your customers. You may feel you have enough experience and don’t need a plan, but every industry is different and a plan will still help you visualise the process and clearly pinpoint where to start taking action.
Property requires consistent, hands-on management. Whether you plan to acquire commercial or residential property for sale in Gauteng, for example, or property in multiple provinces, the properties will need to be managed. Figuring out who will be in charge of management is an important action to take before you get going.
If you plan to do the management yourself you must consider everything that it involves, from buying the property, and ensuring monthly bills are paid and maintenance is kept up-to-date, to finding tenants and ensuring they stick to all rules and guidelines. Property management is time-consuming, so if you are able to hire someone to do this for you, it is advised.
To register a property business in South Africa the owner must first register the company name with the Companies and Intellectual Property Commission (CIPC). The owner can either put forward a new name (at a cost of R50), use one already approved by the CIPC, or use the registration number provided by the CIPC as the company name.
The next step is to register the company with the CIPC, either online or by visiting an approved bank branch. Once the company has a registered profile the owner must pay R125 to cover the registration cost. The following information is then required:
- Country of origin
- ID/Passport number
- Appointment date
- Date of birth
- Physical and postal addresses
- Financial year end
- Authorised shares
- Email address, website, physical address and postal code
Once the above information has been submitted, the owner will receive an email from the CIPC requesting further documentation:
- Certified ID copies of all directors and founders
- Certified ID copy of the applicant (if not a director or founder)
- Signed registration forms
The CIPC will then register the business within three working days, and the owner will receive a confirmation email with a link to their disclosure certificate and their company's incorporation documents on the CIPC website. Once registration is complete the owner may continue with opening up a business bank account, registering with SARS, registering for VAT, registering with the Unemployment Insurance Fund (UIF), and registering any employees with the Compensation Fund.
While these aren’t all the facts you need to consider before starting a property business, they certainly are some of the most important.
Hopefully, with these tips in mind you’ll be at a more knowledgeable starting point before getting your property business off the ground.
The content in this article was provided by Janice Garman – a senior content specialist at TMI SA, writing for clients from a range of industries, business types and specialties.
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