Just signed on a vacant land deal for a new build (South Africa)

[Tiaan De lange]

Hi Guys, 

Tiaan here from South-Africa. I'm fairly new to the STR game, I own one multi-family LTR, but my interest shifted to the STR market due to the big opportunity.

Just signed on a piece of vacant land in Dullstroom, Mpumalanga. It's a small town in South-Africa attracting a lot of tourists over weekends and holidays, perfect for an AirBnB. 

Stand Price: $20,000.00 (R390,000.00)

Build cost prediction: $40,000.00 (+-R800,000.00)

Average daily rate: $100 (+-R1800) 

Predicted occupancy: 40% - 80% depending on season. 

LTV: 90 - 100% (South-Africa tends to give up to 100% loans)

Interest rate: 9.75% (Very high rates in SA)

I'm sharing my deal to get involved on the BiggerPockets platform and to connect with other people who is interested in the market. 

[Tiaan De lange]

Thanks Michael! It depends on the size. But taking it from the architectural drawings to occupation on our build (2 Bedroom) should take about 5 to 7 months.