Growth & Jobs | Property power: More young people investing in real estate
On Friday, September 21, 2018, Sheldon Pinnock cried tears of joy when he was handed the keys to his first house.
“I’m not a man who cries a lot, but that day the tears flowed and I couldn’t hold them back. Because that was the day I finally realised that my dream had come true. It was finally real. The thing that I had dreamed about, day and night, for so many years, had finally come to fruition,” he said.
Like most Jamaicans, owning a home was always a part of Sheldon’s plans. But homeownership for the 32-year-old was not simply about buying a house to live in, it was about building his wealth and leaving a legacy for his children.
“I grew up very poor. I didn’t inherit land, house or anything like that from my parents; so it was up to me to build my own fortune. I wanted to break the cycle of poverty which plagued my family for so many years. And, I promised myself that it would be different for my children,” he related.
Though not yet a father, the Kingston-native has already started to build a foundation, which he believes his future children will be proud of.
After years of saving towards his down payment for a home, Sheldon finally found a property that was within his price range.
“Saving towards the deposit and other expenses was hard work and it didn’t happen overnight. It was tough. Sometimes I didn’t even have money to buy groceries. I was living hand to mouth, but I knew it was all for a greater purpose,” he said. “And I was actually fortunate to have certain skill sets that I could use to generate a second income.”
As an IT professional, Sheldon was able to use his skills to make extra money, which he would put towards his deposit for a house. After three years of searching and saving, he was able to purchase a four-bedroom, two-bathroom house in a gated community in St Catherine for $8 million.
“It was a blessing. It was almost like God had this house set aside especially for me,” he declared.
After closing the deal, the astute businessman decided that it was now time to start earning an income from his investment.
“I decided not to live in the house, which is a two-storey building. Instead, I made some modifications so that it could be rented to two families,” he explained.
His first tenant moved in early February. He’s now making the final touches to the second floor of the property to make it a stand-alone unit, so that a second tenant can move in within another a few months.
By renting out the property, Sheldon will be able to cover his mortgage payments on a monthly basis.
“I now live in a small studio apartment in Kingston, because, as a single man, I don’t need much more than that. If my landlord is willing to sell, I will be looking to buy this property in another few years,” he disclosed.
For Sheldon, this is the first of many investment properties.
Carlton Earl Samuels, chief development financing officer, at The Jamaica National Group, said now is the time for young people, such as Sheldon, to step into the real estate market.
He noted that the move by financial institutions, over the past few years, to increase the amount they’re willing to lend for a mortgage, in addition to lowering interest rates, has created a great opportunity for young people.
“This, coupled with the government’s recent decision to reduce the transaction costs associated with purchasing property is a great stimulus to the real-estate sector, because it increases affordability,” he advised.
Howard Johnson Jr, chief executive officer of Howard Johnson Realty, advises young persons who are interested in real-estate investment to first identify their objectives.
“What are you hoping to get out of this property? Are you looking for permanent accommodation for yourself, or are you looking at this purchase as an investment opportunity? Once you identify your objective, then it is important for you to consult with a realtor,” he advised.
Johnson noted that a realtor will help prospective purchasers to navigate their search for the right property, based on their objectives.
“Our goal is help you to find the right place, in the right location, at a price that you can afford. We will also guide you to a financial expert, who will tell you if you can be prequalified for a mortgage,” he said.