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Showing posts with label south africa property. Show all posts
Showing posts with label south africa property. Show all posts
Monday, 16 January 2012
Tuesday, 31 May 2011
Are banks 'killing' the Property Market?
Has it ever struck you just how many people are property experts when you mention that you are thinking of buying or selling a property?
These well-meaning advisers – with opinions that are certainly influenced more by hearsay than knowledge – will say that now is not the time to be involved in the property sector and, as a rule of thumb, they think they’re right.
People with a little more knowledge, like estate agents, will say it’s an excellent time to buy but, if you want to sell, make sure that you’ve priced your house correctly, particularly if it falls into the upper price brackets.
Do estate agents give you a true value? Never. They give you a ‘gut-instinct’ based value that is determined by what you want and what they think they can get. If the house is slow to move, then the price is too high. It’s a pathetic basis for determining a true value.
Bankers (responsible for lending the money) often won’t say a word – except among friends. And the sad fact of the matter is that bankers are the ones who dictate the state of the property market. If they lend money, sales boom. If they don’t sales dwindle.
In years gone by, when the cyclical swings were not as great as they appear to be today, banks would look for value in a property and would grant a bond based on the value that they attributed to it.
You would expect that pattern to be cast in stone and that, today, if you were to go to four different banks, you would get a very similar valuation from all four of them.
And that’s where you’d be so wrong. Different banks have different criteria and they use different yardsticks to adjudicate value. Ask for a value from a banker and you’ll get four very different ones.
This, naturally enough, makes it incredibly difficult for property owners and for estate agents who, for instance, put in an application for a bond (based on a fair purchase price) to all four of the banks and find that some banks come back and say there is “insufficient value” in the property to the grant the bond amount applied for.
The more expensive the home, the greater variation there is. And much of that valuation process appears to be purely subjective rather than scientific.
Question a bank about the details of why the value is so low and they will come up with all sorts of subjective reasons: “It’s not the right property to be buying in this market” or “The property is over-priced for the area” or “The owners have over-capitalised and want too much money” or the “The asking price is simply too high for the home” or, mostly importantly “We won’t grant a loan of that size against that property”..
Forget the fact that the buyer has a right to decide what amount he or she is prepared to pay for the property in question. Forget the fact that the bank won’t pay a penny of the excessively exorbitant interest rates that are calculated over the next 20 or 25 years. That’s the buyer’s responsibility.
Just remember banks borrow money from the Reserve Bank at 5,5% and charge the money they’ve borrowed at prime of 9% so banks make 3,5% gratis before lending a bean. It’s iniquitous.
If that’s not bad enough then we have the other factor: banks can now stipulate what a house is worth by making a snap, subjective and often unfair value judgment.
I watched one of these valuers at work on the property that I currently rent. He had a measuring tape (on wheels to calculate the perimeter of the house) that he wheeled past the plants (not next to the house) to give him a rough idea of the outer boundary.
Then he walked through the house, taking no more than five minutes to survey the lot. Then he swaggered through to my office demanding that I drop what I’m doing and immediately let him out.
If he was here for five minutes then that was a lot.
I went outside with him and waited next to his run-down white jalopy while he searched for an address in a map book.
After I had spent more time looking at him than he had spent looking at my house, I tapped on his window and said, rather sharply, “Listen, bud, I’m busy so why don’t you leave find directions somewhere else rather than just wasting my time.”
He drove away mumbling – and I didn’t give a fig.
His few minutes here resulted in a decision worth more than a million rand. It’s totally absurd and certainly a deeply unprofessional way to determine the value of a property.
His visit was typical of all those others I have experienced when valuators come to value a house. In the course of my lifetime I have bought and sold more than 20 properties and I have never had a different experience from a bank’s valuation man.
So I was hardly surprised to read the comments from Ronald Ennik, an executive director of Leapfrog Property Group who says that banks are damaging the property market by continuing to value properties “too conservatively”.
He’s quite right. I would take it further than Ennik did: I would say that banks are killing the property market and they seem to be doing so with a smile on their corporate faces and it makes me sick.
Apart from making it really hard to qualify for a bond, the banks are now deciding the value of property and what it’s worth. How unfair is that?
Homebuyers’ dreams are smashed by a cretin who spends less than ten minutes looking at a property. The same cretin who cannot even read directions in a map book.
And the bank he represents accepts his word as gospel – the final say on what a property is worth. It’s bizarre.
Surely there must be a less subjective way of determining property values?
Professional land valuers (like my cousin) will tell you that there is a lot more that goes into compiling an accurate and realistic property value than just wandering around with a tape measure and a pair of reasonable eyes.
And it is these professionals that should be doing the valuations for banks and it is their figures that should be the basis for any bond regardless of which bank it is that’s granting the money.
Property values must surely be based on measurable criteria and not on value judgments. Value judgments are not a valuation, they’re a guess. And I wish that Standard, Absa, Nedbank and FNB would remember that.
And then stick to lending money based on the risk profile of the individual and not on whether they approve of the purchase he or she is making.
I also wish that Capitec and African Bank (and others) would step into the market and shake it up completely by adopting a more fair and reasonable approach.
Because as things go mortgage-lending banks are just a very motley bunch.
*Hartdegen writes a regular column for Property24.com. The content of his columns constitutes his personal opinion and doesn’t pretend to be facts or advice.
These well-meaning advisers – with opinions that are certainly influenced more by hearsay than knowledge – will say that now is not the time to be involved in the property sector and, as a rule of thumb, they think they’re right.
People with a little more knowledge, like estate agents, will say it’s an excellent time to buy but, if you want to sell, make sure that you’ve priced your house correctly, particularly if it falls into the upper price brackets.
Do estate agents give you a true value? Never. They give you a ‘gut-instinct’ based value that is determined by what you want and what they think they can get. If the house is slow to move, then the price is too high. It’s a pathetic basis for determining a true value.
Bankers (responsible for lending the money) often won’t say a word – except among friends. And the sad fact of the matter is that bankers are the ones who dictate the state of the property market. If they lend money, sales boom. If they don’t sales dwindle.
In years gone by, when the cyclical swings were not as great as they appear to be today, banks would look for value in a property and would grant a bond based on the value that they attributed to it.
You would expect that pattern to be cast in stone and that, today, if you were to go to four different banks, you would get a very similar valuation from all four of them.
And that’s where you’d be so wrong. Different banks have different criteria and they use different yardsticks to adjudicate value. Ask for a value from a banker and you’ll get four very different ones.
This, naturally enough, makes it incredibly difficult for property owners and for estate agents who, for instance, put in an application for a bond (based on a fair purchase price) to all four of the banks and find that some banks come back and say there is “insufficient value” in the property to the grant the bond amount applied for.
The more expensive the home, the greater variation there is. And much of that valuation process appears to be purely subjective rather than scientific.
Question a bank about the details of why the value is so low and they will come up with all sorts of subjective reasons: “It’s not the right property to be buying in this market” or “The property is over-priced for the area” or “The owners have over-capitalised and want too much money” or the “The asking price is simply too high for the home” or, mostly importantly “We won’t grant a loan of that size against that property”..
Forget the fact that the buyer has a right to decide what amount he or she is prepared to pay for the property in question. Forget the fact that the bank won’t pay a penny of the excessively exorbitant interest rates that are calculated over the next 20 or 25 years. That’s the buyer’s responsibility.
Just remember banks borrow money from the Reserve Bank at 5,5% and charge the money they’ve borrowed at prime of 9% so banks make 3,5% gratis before lending a bean. It’s iniquitous.
If that’s not bad enough then we have the other factor: banks can now stipulate what a house is worth by making a snap, subjective and often unfair value judgment.
I watched one of these valuers at work on the property that I currently rent. He had a measuring tape (on wheels to calculate the perimeter of the house) that he wheeled past the plants (not next to the house) to give him a rough idea of the outer boundary.
Then he walked through the house, taking no more than five minutes to survey the lot. Then he swaggered through to my office demanding that I drop what I’m doing and immediately let him out.
If he was here for five minutes then that was a lot.
I went outside with him and waited next to his run-down white jalopy while he searched for an address in a map book.
After I had spent more time looking at him than he had spent looking at my house, I tapped on his window and said, rather sharply, “Listen, bud, I’m busy so why don’t you leave find directions somewhere else rather than just wasting my time.”
He drove away mumbling – and I didn’t give a fig.
His few minutes here resulted in a decision worth more than a million rand. It’s totally absurd and certainly a deeply unprofessional way to determine the value of a property.
His visit was typical of all those others I have experienced when valuators come to value a house. In the course of my lifetime I have bought and sold more than 20 properties and I have never had a different experience from a bank’s valuation man.
So I was hardly surprised to read the comments from Ronald Ennik, an executive director of Leapfrog Property Group who says that banks are damaging the property market by continuing to value properties “too conservatively”.
He’s quite right. I would take it further than Ennik did: I would say that banks are killing the property market and they seem to be doing so with a smile on their corporate faces and it makes me sick.
Apart from making it really hard to qualify for a bond, the banks are now deciding the value of property and what it’s worth. How unfair is that?
Homebuyers’ dreams are smashed by a cretin who spends less than ten minutes looking at a property. The same cretin who cannot even read directions in a map book.
And the bank he represents accepts his word as gospel – the final say on what a property is worth. It’s bizarre.
Surely there must be a less subjective way of determining property values?
Professional land valuers (like my cousin) will tell you that there is a lot more that goes into compiling an accurate and realistic property value than just wandering around with a tape measure and a pair of reasonable eyes.
And it is these professionals that should be doing the valuations for banks and it is their figures that should be the basis for any bond regardless of which bank it is that’s granting the money.
Property values must surely be based on measurable criteria and not on value judgments. Value judgments are not a valuation, they’re a guess. And I wish that Standard, Absa, Nedbank and FNB would remember that.
And then stick to lending money based on the risk profile of the individual and not on whether they approve of the purchase he or she is making.
I also wish that Capitec and African Bank (and others) would step into the market and shake it up completely by adopting a more fair and reasonable approach.
Because as things go mortgage-lending banks are just a very motley bunch.
*Hartdegen writes a regular column for Property24.com. The content of his columns constitutes his personal opinion and doesn’t pretend to be facts or advice.
Friday, 15 April 2011
Rental Property to improve this year
While data availability for the South African rental market is somewhat sparse, available indicators suggest some improvement in the fundamentals driving the rental market, the FNB property barometer indicates.
"It is difficult to determine the level of rental demand, but we believe that the current economic and financial times may have led to some improvement in the demand side of the rental market too," said FNB property strategist John Loos.
He said household sector financial pressure could be a positive factor for the rental market, because it could increase the short-term appeal of renting for a certain group of financially stretched households.
The risks of interest rate hikes later in 2011 were also believed to be a positive for rental demand, as this could lead to some more cautious would-be home buyers adopting a "wait and see" approach, remaining in the rental market for longer and supporting rental demand.
"Our home-buying survey respondents suggest that, although having declined significantly since 2008-09, the percentage of home sellers selling in order to downscale due to financial pressure remains high at about 22%, and many of these sellers move into the rental market," Loos said.
As to how much of the rental market's performance was due to supply factors and how much due to demand-side forces was debatable, Loos said. "We believe that there are elements of both, particularly on the supply side due to weak buy-to-let buying in recent times. The net result, though, appears to be one of mild rental market strengthening through 2010."
Using data from Rode and Associates regarding flat rentals, it would appear that at least the flats component of the rental market had responded, Loos said.
"By major city, while one saw no fireworks yet, our calculations of flat rental averages per major city showed a broad increase in market rental inflation rates since the 2009 slump. The two-quarter moving average for Johannesburg showed the most impressive increase of 16.2% year on year as at the fourth quarter of 2010, while Pretoria showed the slowest rate of increase of 5.5%," he said.
"It is difficult to determine the level of rental demand, but we believe that the current economic and financial times may have led to some improvement in the demand side of the rental market too," said FNB property strategist John Loos.
He said household sector financial pressure could be a positive factor for the rental market, because it could increase the short-term appeal of renting for a certain group of financially stretched households.
The risks of interest rate hikes later in 2011 were also believed to be a positive for rental demand, as this could lead to some more cautious would-be home buyers adopting a "wait and see" approach, remaining in the rental market for longer and supporting rental demand.
"Our home-buying survey respondents suggest that, although having declined significantly since 2008-09, the percentage of home sellers selling in order to downscale due to financial pressure remains high at about 22%, and many of these sellers move into the rental market," Loos said.
As to how much of the rental market's performance was due to supply factors and how much due to demand-side forces was debatable, Loos said. "We believe that there are elements of both, particularly on the supply side due to weak buy-to-let buying in recent times. The net result, though, appears to be one of mild rental market strengthening through 2010."
Using data from Rode and Associates regarding flat rentals, it would appear that at least the flats component of the rental market had responded, Loos said.
"By major city, while one saw no fireworks yet, our calculations of flat rental averages per major city showed a broad increase in market rental inflation rates since the 2009 slump. The two-quarter moving average for Johannesburg showed the most impressive increase of 16.2% year on year as at the fourth quarter of 2010, while Pretoria showed the slowest rate of increase of 5.5%," he said.
More first time home buyers show confidence in market - FNB
There were more first time home buyers in the first quarter of 2011, indicating improved confidence in the property market, FNB Home Loans strategist John Loos said on Wednesday.
"The increase in first time buyer demand relative to the overall market demand is a good confidence indicator due to the greater degree of flexibility that an average first time buyer has in terms of timing his/her entry into the market," Loos said in a statement.
He said this reflected "improved new buyer confidence in lagged response to a dramatically improved interest rate environment since 2008".
It also showed improving confidence by the banks offering home loans.
First time buyers made up 22 percent of total buyers in the first quarter of the year, compared to 17 percent in the previous quarter.
"This percentage now compares favourably with the percentages recorded around late-2006, although the absolute volume would still be significantly lower than then because the overall market volumes are considerably lower these days compared to then," Loos said.
The "ageing buyer" trend seen in recent years was being reversed as a result of the improved interest rate and credit environment, and the resultant emergence of a more significant group of first time buyers.
Loos said using Deeds Office data on individuals' transactions, it was estimated that in the four quarters up to and including the first quarter of 2011, 15.3 percent of total buyers were aged 30 and below.
This was up from 14.7 percent in the fourth quarter of 2010, and even higher than the low point of 11.4 percent in the third quarter of 2009.
Loos said the most noticeable increase in market share was among the 31 to 40 years age group -- making up 28.1 percent of total buying in the first quarter of 2011.
This was up from 21.8 percent for the four quarters up to the third quarter of 2009.
The 41-50 year age increased its share of total buying from a 17.7 percent low as at the third quarter of 2008 to 21.7 percent as at the first quarter of 2011.
The 50-plus age group had seen its share drop from 48.8 percent as at the second quarter of 2009 to 35 percent as at the first quarter of 2011.
Loos warned potential first-time home buyers to be aware that inflation could rise, leading to increasing interest rates, so they had to be sure that they could absorb any increases.
"... Three percentage points [from prime rate of nine percent to a rate of 12 percent] would mean that on a bond amount of, say R700,000 at prime rate, the monthly instalment would increase by about R1410 per month."
He also reminded buyers to take into account above inflation increases in municipal rates and tariffs "which have become a far more significant property-related cost in recent years".
"The increase in first time buyer demand relative to the overall market demand is a good confidence indicator due to the greater degree of flexibility that an average first time buyer has in terms of timing his/her entry into the market," Loos said in a statement.
He said this reflected "improved new buyer confidence in lagged response to a dramatically improved interest rate environment since 2008".
It also showed improving confidence by the banks offering home loans.
First time buyers made up 22 percent of total buyers in the first quarter of the year, compared to 17 percent in the previous quarter.
"This percentage now compares favourably with the percentages recorded around late-2006, although the absolute volume would still be significantly lower than then because the overall market volumes are considerably lower these days compared to then," Loos said.
The "ageing buyer" trend seen in recent years was being reversed as a result of the improved interest rate and credit environment, and the resultant emergence of a more significant group of first time buyers.
Loos said using Deeds Office data on individuals' transactions, it was estimated that in the four quarters up to and including the first quarter of 2011, 15.3 percent of total buyers were aged 30 and below.
This was up from 14.7 percent in the fourth quarter of 2010, and even higher than the low point of 11.4 percent in the third quarter of 2009.
Loos said the most noticeable increase in market share was among the 31 to 40 years age group -- making up 28.1 percent of total buying in the first quarter of 2011.
This was up from 21.8 percent for the four quarters up to the third quarter of 2009.
The 41-50 year age increased its share of total buying from a 17.7 percent low as at the third quarter of 2008 to 21.7 percent as at the first quarter of 2011.
The 50-plus age group had seen its share drop from 48.8 percent as at the second quarter of 2009 to 35 percent as at the first quarter of 2011.
Loos warned potential first-time home buyers to be aware that inflation could rise, leading to increasing interest rates, so they had to be sure that they could absorb any increases.
"... Three percentage points [from prime rate of nine percent to a rate of 12 percent] would mean that on a bond amount of, say R700,000 at prime rate, the monthly instalment would increase by about R1410 per month."
He also reminded buyers to take into account above inflation increases in municipal rates and tariffs "which have become a far more significant property-related cost in recent years".
Sunday, 30 January 2011
Commercial Property recovery?
State leasing contracts may give property investors a reliable cash flow, while sales of distressed commercial properties may mean that bargains can still be found.
The South African commercial property market is showing signs of recovery in the coming year with certain areas offering reasonable prospects for higher profits, claims Mergence Africa Property Fund.
“There is a cautiously positive outlook for investments in commercial property in South Africa with a number of bright spots around the country offering the potential for higher-than-average returns for investors,” claims Mergence’s Izak Petersen.
He says that property owners with the right black economic empower credentials will benefit from leases from government departments and state-owned enterprises. “These leases represent a low risk in the testing economic environment,” says Petersen.
He says that property investors need to have a mix of government and national corporate tenants in their portfolios as these contracts improve the cash flow reliability, which is essential for property investment.
“Government tenancies put investors in the beneficial position of being default-free,” he says.
Referring to the risk profile, Petersen points out that corporate downsizing and the growing number of liquidations have boosted the rental default levels and when this is combined with higher municipal and electricity charges it makes the commercial property market challenging.
“For those property funds looking to acquire new properties, the increase in distressed selling may mean that bargains are available and could lead to more quality stock coming into the market,” he says.
According to the latest SAPOA Office Vacancy Survey, prime office space in Johannesburg and Cape Townwas either fully let or had vacancy levels of less than one percent.
Timing is Everything !
Seasonality is a well-established phenomenon in the global property market and, although it follows a different time frame, it is also clearly evident in the local property market. Seasonality essentially refers to changes in sales volumes and sales prices during the same calendar month from year to year, that reveal a similar magnitude and direction.
This seasonality is caused by natural factors such as the weather, administrative dates such as the beginning and end of the school year as well as social, cultural or religious traditions which include fixed holidays such as Christmas.
"Regardless of the overall trend in the property market, or the specific phase of the property cycle in a certain sector of the market, the property market displays seasonality, with higher prices driven by increased activity at certain times of the year. In South Africa, during the spring and summer months, sales activity increases and, as a natural consequence, property prices are firmer on the back of this increased demand. The effect on prices may not always be remarkable – but the effect on sales activity is often quite noticeable," explains Adrian Goslett, CEO of RE/MAX of Southern Africa.
He adds that two seasonal factors are at play during our spring and summer months.
"Firstly, the summer brings lush gardens, green grass and colourful flowers, and this certainly goes some way to create a favourable first impression among potential buyers. Secondly, the school year in South Africa runs from mid-January to early December, and families planning to relocate always prefer to do so at the end of the year to allow the children to complete a school year at one school and to start afresh at a new school at the beginning of the new year," he says.
But seasonality extends further into other sub-sectors of the market.
"In the student accommodation sector spring brings an increase in activity as students going to university in the new year look for accommodation and those who have completed their last year of study move away. While many people are on holiday in December, this does not detract from the seasonality of property sales during the summer, but simply shifts the locus of the seasonal upswing to the coastal and holiday towns in the country," comments Goslett.
Seasonality is not simply a phenomenon of interest to estate agents; it also has implications for buyers and sellers. Prices may not boom during the seasonal upturn during the spring and summer months, but the average percentage by which a seller needs to reduce the asking price to achieve a sale may be noticeably lower than in the winter months. This reflects the increase in potential buyers during these seasonal peaks, and more buyers mean a better chance of selling the property at a higher price.
Buyers and sellers who understand the seasonality of the property market are able to make better informed decisions. For example, buyers looking for student accommodation may find few available properties in April when all available student accommodation is fully occupied, but may be able to acquire such a property at a better price at the end of the year when more properties become available as students complete their studies.
"Understanding the seasonality of the property industry allows buyers and sellers to maintain a longer-term perspective on the immediate state of a specific property sector. Sellers considering taking a property off the market just before the summer holidays could well miss a sales opportunity given the uptick in interest during this time. Similarly, buyers should bear the seasonal factors in mind when making an offer on a property, particularly in areas where the effect of seasonality is particularly evident, such as in coastal towns and other holiday destinations," concludes Goslett.
Monday, 3 January 2011
The PROS and CONS of transferring Property from a Trust to your Personal Name
A significant new tax break which was granted by the South African Revenue Services on October 31 this year allows those whose residential properties are 'held' in companies, close corporations or trusts to transfer them, free of income or capital gains tax or transfer duty, into their own names or those of their beneficiaries.
The new law allows greater flexibility about the choice of the beneficiary - and it can be made use of until January 1 2013.
This new ruling should be made use of by as many people as possible because there is no logic in sticking to the old holding entities.
To hold a property in a trust, a close corporation or a company will automatically result in its eventually being taxed higher on capital gains when sold than if it were in the individual's name.
Furthermore, no concessions will be made for it possibly being the owner's primary residence. If the property is the owner's primary residence and is registered in his name, the first R1.5m will be exempt from tax.
The advantages of accepting individual ownership have been reinforced from the start of this year by the government's instituting an annual levy for the continued establishment of corporate entities. This could add significantly to the annual holding costs of such entities.
Under the amended law the person taking ownership of the property from a company must have lived in and used it primarily for domestic purposes from or before 11th February 2009. Furthermore, he must still be living there.
The beneficiary must also be a 'connected' person in terms of the Income Tax Act. This means that the owner himself and a relative must together have at least 20% of the holding company's shares.
If the property is being taken over from a close corporation, the other owner/partner can be another member of the close corporation or a relative of such a member - but in all cases the transfer will become invalid if steps are not taken to wind up, liquidate or de-register the company or close corporation within six months of the transfer of the property.
Similar rules apply to property transferred from trusts, but there the 'connected persons' concept has been extended to apply to any beneficiary of the trust or a relative of that person.
Where the original holding vessel has a more complicated structure, provision is made for unbundling this.
For example where a property is owned by a company, a close corporation or a trust, which is in turn owned by another corporate identity, or where the shares in the company are owned by a trust the beneficiaries of which live in the home, the new law again allows for the free transfer of the property from the company to the trust and then from the trust to one or more beneficiaries.
Again, the person to whom the property is transferred must have been using it as his primary residence for the stipulated period to qualify for the capital gains tax exemption.
Although the tax savings of a transfer to individual ownership are significant, the conveyancing fees will still be payable, as on any normal residential property transaction.
Furthermore, if a property is bonded,, the costs of cancelling the bond and registering a new one will have to be allowed for. It is possible that the new owner under today's stringent National Credit Act restrictions might find himself unable to raise a bond of the same size as the original - he might even be refused any bond.
This matter should be looked into before the transfer is affected.
*Lanice Steward is MD of the Cape Peninsula estate agency Anne Porter Knight Frank
The new law allows greater flexibility about the choice of the beneficiary - and it can be made use of until January 1 2013.
This new ruling should be made use of by as many people as possible because there is no logic in sticking to the old holding entities.
To hold a property in a trust, a close corporation or a company will automatically result in its eventually being taxed higher on capital gains when sold than if it were in the individual's name.
Furthermore, no concessions will be made for it possibly being the owner's primary residence. If the property is the owner's primary residence and is registered in his name, the first R1.5m will be exempt from tax.
The advantages of accepting individual ownership have been reinforced from the start of this year by the government's instituting an annual levy for the continued establishment of corporate entities. This could add significantly to the annual holding costs of such entities.
Under the amended law the person taking ownership of the property from a company must have lived in and used it primarily for domestic purposes from or before 11th February 2009. Furthermore, he must still be living there.
The beneficiary must also be a 'connected' person in terms of the Income Tax Act. This means that the owner himself and a relative must together have at least 20% of the holding company's shares.
If the property is being taken over from a close corporation, the other owner/partner can be another member of the close corporation or a relative of such a member - but in all cases the transfer will become invalid if steps are not taken to wind up, liquidate or de-register the company or close corporation within six months of the transfer of the property.
Similar rules apply to property transferred from trusts, but there the 'connected persons' concept has been extended to apply to any beneficiary of the trust or a relative of that person.
Where the original holding vessel has a more complicated structure, provision is made for unbundling this.
For example where a property is owned by a company, a close corporation or a trust, which is in turn owned by another corporate identity, or where the shares in the company are owned by a trust the beneficiaries of which live in the home, the new law again allows for the free transfer of the property from the company to the trust and then from the trust to one or more beneficiaries.
Again, the person to whom the property is transferred must have been using it as his primary residence for the stipulated period to qualify for the capital gains tax exemption.
Although the tax savings of a transfer to individual ownership are significant, the conveyancing fees will still be payable, as on any normal residential property transaction.
Furthermore, if a property is bonded,, the costs of cancelling the bond and registering a new one will have to be allowed for. It is possible that the new owner under today's stringent National Credit Act restrictions might find himself unable to raise a bond of the same size as the original - he might even be refused any bond.
This matter should be looked into before the transfer is affected.
*Lanice Steward is MD of the Cape Peninsula estate agency Anne Porter Knight Frank
Friday, 15 October 2010
Commercial property under pressure
The outlook for the commercial property market is bleak with developers and bankers taking a far more cautious view of this sector says property economist Francois Viruly of the University of the Witwatersrand’s School of Construction Economics and Management.
He warns that there has been a dramatic drop in the number of developments underway and even existing projects are being reassessed to avoid adding to the widespread over-supply of office accommodation.
“Office vacancy rates have increased since last year and this picture is unlikely to change before 2011 or perhaps 2012,” he warns. “Increased spending in the retail sector might have an impact on reducing vacancy rates in retail shopping centres in the short term,” he claims.
Hyprop Investment’s Mike Rodel says that the time is ripe to get particularly good rental deals from agents or developers who are keen to boost occupancy levels. Rodel says that Hyprop is expecting national retail sales growth of between 7% and 10% over the next two years with regional centres growing by up to 12%.
Rodel says that the margin of operating costs to gross rentals has continued to rise and increased from 30% two years ago to 40% now and high vacancy rates have made it difficult for owners to pass the rising costs on to the tenants.
Viruly warns that the biggest difficulty facing developers is to keep the operating costs in retail centres under control as the operating margins are too high at the moment and need to be brought back under control.
“There are likely to be some retail opportunities that do arise in the short term – such as for retail space on Gautrain stations – but the retail property market will remain under pressure until at least the second half of next year,” says Viruly.
Broll says that while there has been pressure on the retail and office market, there are still some impressive deals being done. The company recently sold two investment properties in Cape Town.
The first, 43 Bloulelie Crescent in Plattekloof sold for R13,5-million and 5 Ravenscraig Road in Woodstock sold for R33,75-million.
The Bloulelie Crescent property is let out to medical professionals while the Ravenscraig Road building is home to a large printing firm in a traditional industrial area.
According to Sean Berowsky, national property investment specialist at Broll, the interest levels from investment buyers has remained high, particularly for prime commercial and industrial properties.
He concedes that transactions have been restricted by the limited negotiability of sellers because of prevailing low interest rates and the limited stock that’s available.
“The difficult funding environment facing buyers means that there must be a substantial injection of equity,” he says. “Well-tenanted properties with good income streams are still easy to sell whereas buildings with high vacancy rates are not attracting much interest at all,” he adds.
He warns that there has been a dramatic drop in the number of developments underway and even existing projects are being reassessed to avoid adding to the widespread over-supply of office accommodation.
“Office vacancy rates have increased since last year and this picture is unlikely to change before 2011 or perhaps 2012,” he warns. “Increased spending in the retail sector might have an impact on reducing vacancy rates in retail shopping centres in the short term,” he claims.
Hyprop Investment’s Mike Rodel says that the time is ripe to get particularly good rental deals from agents or developers who are keen to boost occupancy levels. Rodel says that Hyprop is expecting national retail sales growth of between 7% and 10% over the next two years with regional centres growing by up to 12%.
Rodel says that the margin of operating costs to gross rentals has continued to rise and increased from 30% two years ago to 40% now and high vacancy rates have made it difficult for owners to pass the rising costs on to the tenants.
Viruly warns that the biggest difficulty facing developers is to keep the operating costs in retail centres under control as the operating margins are too high at the moment and need to be brought back under control.
“There are likely to be some retail opportunities that do arise in the short term – such as for retail space on Gautrain stations – but the retail property market will remain under pressure until at least the second half of next year,” says Viruly.
Broll says that while there has been pressure on the retail and office market, there are still some impressive deals being done. The company recently sold two investment properties in Cape Town.
The first, 43 Bloulelie Crescent in Plattekloof sold for R13,5-million and 5 Ravenscraig Road in Woodstock sold for R33,75-million.
The Bloulelie Crescent property is let out to medical professionals while the Ravenscraig Road building is home to a large printing firm in a traditional industrial area.
According to Sean Berowsky, national property investment specialist at Broll, the interest levels from investment buyers has remained high, particularly for prime commercial and industrial properties.
He concedes that transactions have been restricted by the limited negotiability of sellers because of prevailing low interest rates and the limited stock that’s available.
“The difficult funding environment facing buyers means that there must be a substantial injection of equity,” he says. “Well-tenanted properties with good income streams are still easy to sell whereas buildings with high vacancy rates are not attracting much interest at all,” he adds.
Friday, 1 October 2010
Airports let property markets take off
The development of airport infrastructure around SA is fuelling nearby commercial and residential property markets and while there are many who decry the effects of noise pollution, the impetus seems unstoppable.
So says Gerhard Kotzé, CEO of the ERA South Africa property group, who adds that airports and their expansion still generate mixed reactions, but there’s little doubt that the economies of surrounding areas benefit.
“South Africa, under the impetus of the Soccer World Cup and other influences, has extensively upgraded its airport infrastructure recently in terms of both international and regional feeder services.
“Unsurprisingly, the biggest investment of late has come from the Airports Company of South Africa (ACSA), which has now come to the end of a R17bn development programme, including the commissioning of spectacular new terminal buildings at OR Tambo International, Cape Town International and KZN’s King Shaka International airports among others.”
This kind of parastatal development is to be expected, he says, particularly in support of a major sporting event such as the World Cup but it’s interesting to note the private sector development of airports in recent years as well, including the major upgrades of Lanseria and Wonderboom airports.
“And new property development flows in the wake of these projects - in the case of Lanseria International for example, now Gauteng’s second biggest airport, a new R200m industrial estate with further investment of some R7bn over time is in the pipeline which in turn is expected to spark off additional residential development.
“Surrounding Wonderboom, a residential air park is being constructed along the lines of much talked-about developments of this nature in the US elsewhere in the world, while in the Welkom area a R3bn, three-phase development project including residential, entertainment, cultural and sports facilities is reportedly on the cards.”
Similarly, the development of King Shaka International north of Durban has definitely stimulated property markets in La Mercy, Umhlanga, Ballito and other north coast centres while in Mpumalanga, the Kruger Park
Mpumalanga International airport is credited with spurring all manner of economic activity in Nelspruit and beyond, Kotzé notes.
“Clearly there will always be those who avoid acquiring property in airport approach areas, but on balance it would seem the benefits of airport development for the property sector are very positive.”
Elwyn Schenk, Pam Golding Properties (PGP) area principal in Umhlanga, Umdloti and La Mercy areas, says the Umhlanga node north of Durban is firmly entrenched as the area of choice for residents, investors and commercial end users alike.
“Thus prices in the area have remained fairly stable during the difficult economic conditions. Part of the reason for this, we believe, is that the potential for the area has been enhanced by the King Shaka International Airport and the Dube Tradeport.”
Durban's north coast has all the ingredients to develop into a similar, but still different, version of Cape Town's Atlantic Seaboard.
“The mild and sunny climate year round, beautiful beaches – add to this the rapid growth of the Umhlanga node and proximity to Gauteng (one hour's flight) and you have all the ingredients for rapid future growth. While certain areas such as Umhlanga and Umdloti are heavily developed, there is significant coastal land still available for expansion, in particular La Mercy, 5km from King Shaka Airport, offers substantial potential.”
“Global trends have shown that areas in close proximity to an international airport benefit from sustained and rapid growth. Commercially the Dube Tradeport will serve as a catalyst for economic development which will see KZN emerge as a major SA business node, serving Sub-Saharan Africa and the Far East in particular.
Experience has shown that property prices, both residential and commercial, will benefit from these developments. Commercial demand will come for hotels, engineering and other industries which service the airport, such as food services and import/export companies.”
Schenk says apart from the normal infrastructural development around airports – fuel depots, catering services, maintenance etc. – history the world over has shown that a new airport in particular will bring substantial additional development in peripheral industries such as freight companies, import/export agencies and related activities. “Passenger services and hotels are also attracted to a new airport facility.”
“Thus airports bring in their wake a substantial permanent population, together with a transient population ranging from contract workers to every day tourists.”
The effects of these demographic changes on the property industry are profound, especially in the medium to long term. “The trend for big businesses to move from the CBD into the north has been evident for some years and Umhlanga has been a prime beneficiary of this.”
He says future expected trends arising from the airport area will be a demand for mid-price housing from the blue collar workers, a surge in rental demand for the same reason and an increase in investor demand.
Clive Greene, PGP principal in Ballito, says the King Shaka Airport has created positive sentiment in the market. "Rental enquiries have increased twofold."
He says enquiries on properties for under R1m in the vicinity of the airport have picked up. “Sales on these lower cost properties are selling well. Caledon estates are nearly sold out with over 100 units sold.
In Sheffield Manor Estates there have been over 50 sales in the last five months and Sheffield Manor over 100 sales in the last 10 months. Simbithi Estate continues to sell very well, offering a secure lifestyle for old and young families.
He says commercial development will definitely increase as land has been allocated around the airport for development and Ballito is starting to offer large tracts of land for commercial use. “This, in turn, will increase demand for more residential property. The future for this area in the medium to long term is exceptional.” – Eugene Brink
So says Gerhard Kotzé, CEO of the ERA South Africa property group, who adds that airports and their expansion still generate mixed reactions, but there’s little doubt that the economies of surrounding areas benefit.
“South Africa, under the impetus of the Soccer World Cup and other influences, has extensively upgraded its airport infrastructure recently in terms of both international and regional feeder services.
“Unsurprisingly, the biggest investment of late has come from the Airports Company of South Africa (ACSA), which has now come to the end of a R17bn development programme, including the commissioning of spectacular new terminal buildings at OR Tambo International, Cape Town International and KZN’s King Shaka International airports among others.”
This kind of parastatal development is to be expected, he says, particularly in support of a major sporting event such as the World Cup but it’s interesting to note the private sector development of airports in recent years as well, including the major upgrades of Lanseria and Wonderboom airports.
“And new property development flows in the wake of these projects - in the case of Lanseria International for example, now Gauteng’s second biggest airport, a new R200m industrial estate with further investment of some R7bn over time is in the pipeline which in turn is expected to spark off additional residential development.
“Surrounding Wonderboom, a residential air park is being constructed along the lines of much talked-about developments of this nature in the US elsewhere in the world, while in the Welkom area a R3bn, three-phase development project including residential, entertainment, cultural and sports facilities is reportedly on the cards.”
Similarly, the development of King Shaka International north of Durban has definitely stimulated property markets in La Mercy, Umhlanga, Ballito and other north coast centres while in Mpumalanga, the Kruger Park
Mpumalanga International airport is credited with spurring all manner of economic activity in Nelspruit and beyond, Kotzé notes.
“Clearly there will always be those who avoid acquiring property in airport approach areas, but on balance it would seem the benefits of airport development for the property sector are very positive.”
Elwyn Schenk, Pam Golding Properties (PGP) area principal in Umhlanga, Umdloti and La Mercy areas, says the Umhlanga node north of Durban is firmly entrenched as the area of choice for residents, investors and commercial end users alike.
“Thus prices in the area have remained fairly stable during the difficult economic conditions. Part of the reason for this, we believe, is that the potential for the area has been enhanced by the King Shaka International Airport and the Dube Tradeport.”
Durban's north coast has all the ingredients to develop into a similar, but still different, version of Cape Town's Atlantic Seaboard.
“The mild and sunny climate year round, beautiful beaches – add to this the rapid growth of the Umhlanga node and proximity to Gauteng (one hour's flight) and you have all the ingredients for rapid future growth. While certain areas such as Umhlanga and Umdloti are heavily developed, there is significant coastal land still available for expansion, in particular La Mercy, 5km from King Shaka Airport, offers substantial potential.”
“Global trends have shown that areas in close proximity to an international airport benefit from sustained and rapid growth. Commercially the Dube Tradeport will serve as a catalyst for economic development which will see KZN emerge as a major SA business node, serving Sub-Saharan Africa and the Far East in particular.
Experience has shown that property prices, both residential and commercial, will benefit from these developments. Commercial demand will come for hotels, engineering and other industries which service the airport, such as food services and import/export companies.”
Schenk says apart from the normal infrastructural development around airports – fuel depots, catering services, maintenance etc. – history the world over has shown that a new airport in particular will bring substantial additional development in peripheral industries such as freight companies, import/export agencies and related activities. “Passenger services and hotels are also attracted to a new airport facility.”
“Thus airports bring in their wake a substantial permanent population, together with a transient population ranging from contract workers to every day tourists.”
The effects of these demographic changes on the property industry are profound, especially in the medium to long term. “The trend for big businesses to move from the CBD into the north has been evident for some years and Umhlanga has been a prime beneficiary of this.”
He says future expected trends arising from the airport area will be a demand for mid-price housing from the blue collar workers, a surge in rental demand for the same reason and an increase in investor demand.
Clive Greene, PGP principal in Ballito, says the King Shaka Airport has created positive sentiment in the market. "Rental enquiries have increased twofold."
He says enquiries on properties for under R1m in the vicinity of the airport have picked up. “Sales on these lower cost properties are selling well. Caledon estates are nearly sold out with over 100 units sold.
In Sheffield Manor Estates there have been over 50 sales in the last five months and Sheffield Manor over 100 sales in the last 10 months. Simbithi Estate continues to sell very well, offering a secure lifestyle for old and young families.
He says commercial development will definitely increase as land has been allocated around the airport for development and Ballito is starting to offer large tracts of land for commercial use. “This, in turn, will increase demand for more residential property. The future for this area in the medium to long term is exceptional.” – Eugene Brink
Strand Beach Road sales pick up
The Strand Beach Road property market has showed positive signs contrary to the general SA sectional title market during the 2008/9 period with growing sales figures since the latter part of 2009 – comparative to the depressed sales of the 2008/9 period
Benhard Wiese, principal associate of Cape Coastal Homes, says these better-than-national sectional title sales figures are attributable to the area offering much better value per square metre than the similar property offerings on e।g. the Cape Atlantic seaboard.
“The buyers interested in Strand Beach Road are also buying with a long term view – mostly viewing the property as their second home to be converted into their retirement home.”
He says only 7% of the registered sales of apartments older than three years on Beach Road have during 2010 been for less than present comparative property values per sqm – a sign of a solid market that escaped the storms of 2008/9 relatively unscathed.
“The availability and affordability of credit coupled with the surplus of available new development apartments on Beach Road since 2007 had suppressed capital growth during 2008 to 2010. According to CMA Info, there had been 46 sales in Strand Beach Road during 2008 - that is about four sales per month.”
The volume of sales, however (excluding inheritance), during 2009 grew to 86 transactions of which 25 were new developments and 61 were older complexes.
Excluding all new developments registered in the Deeds Office, there was still a growth in sales volume of about 37% from 2008 to 2009 on Strand Beach Road - totally contrary to statistics from SAPTG which indicate that nationally sectional title (apartment) property priced between R300k to R5m reported an overall decline of 39% in transfers between 2008 and 2009.
The average price per sqm for the 61 registered sales in 2009 for all apartments older than four years on Strand Beach Road (i.e. excluding the new developments which occurred at a higher average price per sq/m) was about R12,900/sqm whilst the new developments registered average prices in 2009 was R17,725/sqm.
The first semester of 2010 has seen a continuation of the growing sales trend on Strand Beach Road with 41 sales being registered according to SAPTG in the Deeds Office of which 14 were new developments built since 2008 (e.g. Hibernian Towers and Topaz).
The average price per sqm for the registered sales in the first semester of 2010 for all apartments older than four years on Strand Beach Road (i.e. excluding the new developments) was about R13,462/sqm.
The new developments average registered prices in 2010 have been ranging between R12,686/sqm for Ocean View to R23,225/sqm for Topaz.He says total registered sales for the first semester of 2010 for the 4 new developments on Strand Beach Road had been R30,524,151 at an average of R15,439 for the 1977sqm sold. That is about 13% lower than the average registered sales prices achieved for new developments during 2009 of R17,725 per sqm.
Interestingly enough, there has only been about a 13% difference in average prices obtained (registered) between older apartments and new developments (less than four years old) during 2010. The present price structure of Beach Road properties can be roughly categorised in different groups according to "age, finishes and size".
The smaller the apartment, the higher the price achieved per sqm. The quality of sea view also has a big effect on the property’s value.Prices obtained in 2008 varied between R7,600/sqm (Strandsig) to R24,700/sqm (Cape Sands). The apartment prices in 2009 varied between R8,500 per sqm (Welgelegen and Jacomahof) to R23,900 per sqm (Hibernian Towers). Beach front apartments were selling in 2003 from about R6k/sqm to about R9k per sqm.
Beach Road property in general has not been subjected to the same forces which have been experienced in e.g. the buy-to let investor property sectors where capital growth has seen fairly substantial drops. The growing foreclosure or bank repossessions trend created during 2008/9 and during the first semester of 2010 effected a strong downward pressure on prices obtained in the buy-to-let property market.
Some auctions at the entry level investor sectional title market (priced at up to R450k) have towards the end of 2009 seen prices drop by as much as 50% of what was the perceived value of the property in 2007. Auctions on Beach Road have, however, been a very small part of the transactional horizon and were therefore not a distinct negative capital growth factor at all.
Only a few distressed sales in some of the new developments took place – without any real effect on the rest of the older blocks, where most of the owners opted to keep their apartments from the market – especially if they did not need to sell.
From the 27 sales which had been registered in the Deeds Office during the first months of 2010, only two transactions took place at prices which seem to be much lower than other comparative properties per sqm – a Romilly apartment at R8,426/sqm and an apartment in Strandsig at R7,432/sqm.Only 7% of all transactions on Beach Road during 2010 amongst the older-than-4-year-old apartment blocks had been registered for much lower than comparative market value.
The last two years has been a sobering period for all property owners in the country – including Beach Road Strand. The unrealistic capital growth expectations have been tempered to pre-2003 growth levels.
Although apartment prices got far “out of touch” with incomes levels during the boom, it is to be expected that inflation will in the next few years close this gap considerably.
“Strand Beach Road has during the last few decades always operated on an eight to ten year tide pattern – with surges of new developments coming every eight to ten years. Buyers who are waiting for Beach Road prices to drop are doing it at their own peril,” he concluded.
Benhard Wiese, principal associate of Cape Coastal Homes, says these better-than-national sectional title sales figures are attributable to the area offering much better value per square metre than the similar property offerings on e।g. the Cape Atlantic seaboard.
“The buyers interested in Strand Beach Road are also buying with a long term view – mostly viewing the property as their second home to be converted into their retirement home.”
He says only 7% of the registered sales of apartments older than three years on Beach Road have during 2010 been for less than present comparative property values per sqm – a sign of a solid market that escaped the storms of 2008/9 relatively unscathed.
“The availability and affordability of credit coupled with the surplus of available new development apartments on Beach Road since 2007 had suppressed capital growth during 2008 to 2010. According to CMA Info, there had been 46 sales in Strand Beach Road during 2008 - that is about four sales per month.”
The volume of sales, however (excluding inheritance), during 2009 grew to 86 transactions of which 25 were new developments and 61 were older complexes.
Excluding all new developments registered in the Deeds Office, there was still a growth in sales volume of about 37% from 2008 to 2009 on Strand Beach Road - totally contrary to statistics from SAPTG which indicate that nationally sectional title (apartment) property priced between R300k to R5m reported an overall decline of 39% in transfers between 2008 and 2009.
The average price per sqm for the 61 registered sales in 2009 for all apartments older than four years on Strand Beach Road (i.e. excluding the new developments which occurred at a higher average price per sq/m) was about R12,900/sqm whilst the new developments registered average prices in 2009 was R17,725/sqm.
The first semester of 2010 has seen a continuation of the growing sales trend on Strand Beach Road with 41 sales being registered according to SAPTG in the Deeds Office of which 14 were new developments built since 2008 (e.g. Hibernian Towers and Topaz).
The average price per sqm for the registered sales in the first semester of 2010 for all apartments older than four years on Strand Beach Road (i.e. excluding the new developments) was about R13,462/sqm.
The new developments average registered prices in 2010 have been ranging between R12,686/sqm for Ocean View to R23,225/sqm for Topaz.He says total registered sales for the first semester of 2010 for the 4 new developments on Strand Beach Road had been R30,524,151 at an average of R15,439 for the 1977sqm sold. That is about 13% lower than the average registered sales prices achieved for new developments during 2009 of R17,725 per sqm.
Interestingly enough, there has only been about a 13% difference in average prices obtained (registered) between older apartments and new developments (less than four years old) during 2010. The present price structure of Beach Road properties can be roughly categorised in different groups according to "age, finishes and size".
The smaller the apartment, the higher the price achieved per sqm. The quality of sea view also has a big effect on the property’s value.Prices obtained in 2008 varied between R7,600/sqm (Strandsig) to R24,700/sqm (Cape Sands). The apartment prices in 2009 varied between R8,500 per sqm (Welgelegen and Jacomahof) to R23,900 per sqm (Hibernian Towers). Beach front apartments were selling in 2003 from about R6k/sqm to about R9k per sqm.
Beach Road property in general has not been subjected to the same forces which have been experienced in e.g. the buy-to let investor property sectors where capital growth has seen fairly substantial drops. The growing foreclosure or bank repossessions trend created during 2008/9 and during the first semester of 2010 effected a strong downward pressure on prices obtained in the buy-to-let property market.
Some auctions at the entry level investor sectional title market (priced at up to R450k) have towards the end of 2009 seen prices drop by as much as 50% of what was the perceived value of the property in 2007. Auctions on Beach Road have, however, been a very small part of the transactional horizon and were therefore not a distinct negative capital growth factor at all.
Only a few distressed sales in some of the new developments took place – without any real effect on the rest of the older blocks, where most of the owners opted to keep their apartments from the market – especially if they did not need to sell.
From the 27 sales which had been registered in the Deeds Office during the first months of 2010, only two transactions took place at prices which seem to be much lower than other comparative properties per sqm – a Romilly apartment at R8,426/sqm and an apartment in Strandsig at R7,432/sqm.Only 7% of all transactions on Beach Road during 2010 amongst the older-than-4-year-old apartment blocks had been registered for much lower than comparative market value.
The last two years has been a sobering period for all property owners in the country – including Beach Road Strand. The unrealistic capital growth expectations have been tempered to pre-2003 growth levels.
Although apartment prices got far “out of touch” with incomes levels during the boom, it is to be expected that inflation will in the next few years close this gap considerably.
“Strand Beach Road has during the last few decades always operated on an eight to ten year tide pattern – with surges of new developments coming every eight to ten years. Buyers who are waiting for Beach Road prices to drop are doing it at their own peril,” he concluded.
Friday, 20 August 2010
Six Reasons NOT to buy property
...and why none of them hold much water।
We often hear about real estate investors who have been very successful in building wealth-creating portfolios। We may believe that they have some very special skill or ability, that there is something they know which nobody else does. At other times, we think it was pure luck or coincidence that an investor succeeded, that circumstances have since changed or that it just can't be done. Our cynicism encourages us to do nothing, to avoid the risk.
Yet history proves that doing nothing could be the most risky of all। Apart from the missed wealth creating opportunities, doing nothing translates into a lack of self-development, a missed chance to learn and grow. If we delve deeper, it is clear that most of the reasons people use not to invest are actually based more on emotion than business savvy. We rationalise our fear using calculated arguments as to why it can't or won't work. But the truth is that none of these arguments really hold much validity.
So let's discuss the top six reasons why people decide not to invest in property। And lay them to rest-once and for all.
Reason # 1: Investing in property is risky
Fact: There is a certain level of risk in every investment-and property is no exception। But investing all your money in the bank (or even worse under the mattress) may be the most risky of all as the returns barely keep up with inflation. Also bricks and mortar is more tangible than stocks and you can take out insurance against fires or floods. You can also protect your asset against your death or disability. And yes, there is now even insurance available to cover landlords for non-paying tenants!
Reason # 2: I don't have the time
Fact: We all manage to find the time to do things we really want to do. Time management involves prioritising things that are more important. Anyway, you don't need to do it all yourself. Build a team of competent management agents, brokers and mortgage originators (yes, there are some out there!) and let their specialist skills work for you.
Reason # 3: I don't have the money
Fact: You DON'T need money to make money। Even in a market where 100% bonds are not widely offered, a good below market value deal will attract finance from investors। Network with people who share your passion for property and these investment opportunities will present themselves।
Reason # 4: Below market-value properties don't exist
Fact: No matter what the stage of the property life-cycle, there will always be value for money deals। The key is to identify initially whether the seller is motivated and only negotiate with motivated sellers. As long as there is divorce, relocation or excessive debt, motivated sellers will always be out there.
Reason # 5: The property market will go down
Fact: The property market has never gone down over the medium or long term. Does that mean that it won't in the future? Probably not, simply because property prices rise in relation to income levels which increase over time. Even political factors, crime and other excuses people use not to invest, have not had a serious impact on our or overseas markets. At times, these factors often have the reverse effect-lifting prices as investors choose the safer haven of bricks and mortar.
And if prices DO go down over the next few years? Who cares! Buying for the rental yield and at below market value still ensures the investor comes out trumps।
Reason # 6: I don't know where to begin
Fact: You only learn through action. Educate yourself and when you feel a good opportunity presents itself, take the plunge. It may not be the best deal you may ever do but it will be the most important in terms of confidence. Luckily, over the long term, property is very forgiving of peoples` mistakes.
We often hear about real estate investors who have been very successful in building wealth-creating portfolios। We may believe that they have some very special skill or ability, that there is something they know which nobody else does. At other times, we think it was pure luck or coincidence that an investor succeeded, that circumstances have since changed or that it just can't be done. Our cynicism encourages us to do nothing, to avoid the risk.
Yet history proves that doing nothing could be the most risky of all। Apart from the missed wealth creating opportunities, doing nothing translates into a lack of self-development, a missed chance to learn and grow. If we delve deeper, it is clear that most of the reasons people use not to invest are actually based more on emotion than business savvy. We rationalise our fear using calculated arguments as to why it can't or won't work. But the truth is that none of these arguments really hold much validity.
So let's discuss the top six reasons why people decide not to invest in property। And lay them to rest-once and for all.
Reason # 1: Investing in property is risky
Fact: There is a certain level of risk in every investment-and property is no exception। But investing all your money in the bank (or even worse under the mattress) may be the most risky of all as the returns barely keep up with inflation. Also bricks and mortar is more tangible than stocks and you can take out insurance against fires or floods. You can also protect your asset against your death or disability. And yes, there is now even insurance available to cover landlords for non-paying tenants!
Reason # 2: I don't have the time
Fact: We all manage to find the time to do things we really want to do. Time management involves prioritising things that are more important. Anyway, you don't need to do it all yourself. Build a team of competent management agents, brokers and mortgage originators (yes, there are some out there!) and let their specialist skills work for you.
Reason # 3: I don't have the money
Fact: You DON'T need money to make money। Even in a market where 100% bonds are not widely offered, a good below market value deal will attract finance from investors। Network with people who share your passion for property and these investment opportunities will present themselves।
Reason # 4: Below market-value properties don't exist
Fact: No matter what the stage of the property life-cycle, there will always be value for money deals। The key is to identify initially whether the seller is motivated and only negotiate with motivated sellers. As long as there is divorce, relocation or excessive debt, motivated sellers will always be out there.
Reason # 5: The property market will go down
Fact: The property market has never gone down over the medium or long term. Does that mean that it won't in the future? Probably not, simply because property prices rise in relation to income levels which increase over time. Even political factors, crime and other excuses people use not to invest, have not had a serious impact on our or overseas markets. At times, these factors often have the reverse effect-lifting prices as investors choose the safer haven of bricks and mortar.
And if prices DO go down over the next few years? Who cares! Buying for the rental yield and at below market value still ensures the investor comes out trumps।
Reason # 6: I don't know where to begin
Fact: You only learn through action. Educate yourself and when you feel a good opportunity presents itself, take the plunge. It may not be the best deal you may ever do but it will be the most important in terms of confidence. Luckily, over the long term, property is very forgiving of peoples` mistakes.
Strike dashes World Cup hopes
THE strikes in the public service and automotive sectors would deter foreign direct investment in SA, a significant contrast to the global optimism about the country during and straight after the Soccer World Cup, economists said yesterday।
“The timing of the strike is problematic, considering the World Cup created such a good impression to potential investors। These hopes would be surely dashed,” said Stanlib economist Kevin Lings.
He said SA could not afford to have nationwide strikes on this scale, especially as the recovery taking place after the global recession was still fragile ।
“The bottom line is that the strikes come at a critical phase of recovery from recession। Most countries are looking at their own economic recovery so that they can gain momentum as soon as possible, Mr Lings said.
Public service unions are demanding an 8,6% wage increase, a R700 housing allowance and an equalisation of medical subsidies.
Yesterday, the South African Democratic Teachers Union (Sadtu) and the National Education Health and Allied Workers Union — together representing nearly 500000 workers — rejected the government’s revised wage offer।
Public schools, hospitals and other government administration offices are expected to close today because of an indefinite strike by public service workers।
“The disruption of services, particularly schools, comes at the wrong time, especially when the country is trying to lift up its matric pass rate,” said Mr Lings। He noted that wages could not be separated from service delivery.
Sadtu said: “The current macroeconomic policy, which is a political matter, is responsible for low wages in the public services।”
Public Service and Administration D eputy M inister Roy Padayachie said the government remained committed to finding a solution to the public service wage dispute।
“We are in the midst of trying to finalise the negotiations in the public sector dispute,” Mr Padayachie said। “We cannot allow ourselves to be compromised from meeting the obligations that we as a government have committed in our programme of action … the issues of finding an appropriate solution and ensuring that the strike is averted are very central to our commitment,” he said.
Meanwhile, the car strike entered its fifth day yesterday, with workers and employers reaching a deadlock over wage negotiations।
Both the National Union of Metalworkers of SA (Numsa) and the Automotive Manufacturers Employers Organisation (Ameo) kept mum over yesterday’s wage negotiation outcome, saying it was at a “sensitive stage”।
George Glynos, an economist at ETM, said the labour dispute might indicate to foreign investors that SA’s automotive industry did not offer the level of productivity required to justify investment capital।
“When there are significant labour problems, companies prefer to spend money on capital equipment to improve efficiencies। Of course, this is not ideal, but is often the necessary course of action.”
Mr Glynos said that investors were well aware that SA had a powerful labour movement, and this had not stopped investment from entering the country।
“Obviously the unions’ power is a deterrent, but investors realise that SA has massive potential and untapped labour reserves which can and have been used to their advantage,” he said.
However, Mr Glynos noted that the public sector and automotive industry strikes were putting pressure on an economy that was bogged down by rising energy costs and eroding infrastructure।
chilwanel@bdfm.co.za shirleyb@bdfm.co.za
“The timing of the strike is problematic, considering the World Cup created such a good impression to potential investors। These hopes would be surely dashed,” said Stanlib economist Kevin Lings.
He said SA could not afford to have nationwide strikes on this scale, especially as the recovery taking place after the global recession was still fragile ।
“The bottom line is that the strikes come at a critical phase of recovery from recession। Most countries are looking at their own economic recovery so that they can gain momentum as soon as possible, Mr Lings said.
Public service unions are demanding an 8,6% wage increase, a R700 housing allowance and an equalisation of medical subsidies.
Yesterday, the South African Democratic Teachers Union (Sadtu) and the National Education Health and Allied Workers Union — together representing nearly 500000 workers — rejected the government’s revised wage offer।
Public schools, hospitals and other government administration offices are expected to close today because of an indefinite strike by public service workers।
“The disruption of services, particularly schools, comes at the wrong time, especially when the country is trying to lift up its matric pass rate,” said Mr Lings। He noted that wages could not be separated from service delivery.
Sadtu said: “The current macroeconomic policy, which is a political matter, is responsible for low wages in the public services।”
Public Service and Administration D eputy M inister Roy Padayachie said the government remained committed to finding a solution to the public service wage dispute।
“We are in the midst of trying to finalise the negotiations in the public sector dispute,” Mr Padayachie said। “We cannot allow ourselves to be compromised from meeting the obligations that we as a government have committed in our programme of action … the issues of finding an appropriate solution and ensuring that the strike is averted are very central to our commitment,” he said.
Meanwhile, the car strike entered its fifth day yesterday, with workers and employers reaching a deadlock over wage negotiations।
Both the National Union of Metalworkers of SA (Numsa) and the Automotive Manufacturers Employers Organisation (Ameo) kept mum over yesterday’s wage negotiation outcome, saying it was at a “sensitive stage”।
George Glynos, an economist at ETM, said the labour dispute might indicate to foreign investors that SA’s automotive industry did not offer the level of productivity required to justify investment capital।
“When there are significant labour problems, companies prefer to spend money on capital equipment to improve efficiencies। Of course, this is not ideal, but is often the necessary course of action.”
Mr Glynos said that investors were well aware that SA had a powerful labour movement, and this had not stopped investment from entering the country।
“Obviously the unions’ power is a deterrent, but investors realise that SA has massive potential and untapped labour reserves which can and have been used to their advantage,” he said.
However, Mr Glynos noted that the public sector and automotive industry strikes were putting pressure on an economy that was bogged down by rising energy costs and eroding infrastructure।
chilwanel@bdfm.co.za shirleyb@bdfm.co.za
Friday, 16 July 2010
Property recovery still '12 to 18 months off'
The residential property market in South Africa is still coming to terms with the fallout from the economic crisis, said Auction Alliance CEO Rael Levitt on Monday.
According to SA's largest auction group, sales trading activity is increasing as home buyers take advantage of a slower recovery.
"South Africans are now seeing a repeat of the lengthy property downturn last experienced in the early 1990's. Opportunistic buyers are finding great deals which is boosting trading volume.
"What is unique about this property contraction is that low values are coinciding with low interest rates. It's thus bargain hunting season for those with access to funding," says Levitt.
According to Levitt, the outlook for the second half of 2010 is flat.
The world cup has been a great shot in the arm for local tourism and retail trading but a full property recovery is still 12-18 months off, even in a reasonable interest rate environment and even with reasonable market stability, says Levitt.
"Those who were expecting the South African real estate market to quickly recover in the second half of 2010, after the world cup, may be in for a long wait."
Alliance is predicting a flat real estate market with no increase in value through December 2010.
This is echoed by Absa senior property analyst, Jacques Du Toit, who says that year-on-year growth in house prices may peak soon.
Du Toit says house prices rose by 14,8% year-on-year last month and that Absa was forecasting slower growth at 8% to 9% until the end of this year.
Levitt concurs with this view and believes that from the beginning of next year prices are projected to increase at a stronger rate.
"Depending on global macro-economic trends we could end up running through a strong cycle only next year," warns Levitt, adding that a property contraction can last for several years and house values could move up more strongly or more weakly, depending on any number of circumstances."
"Certain sectors in the residential property market, such as leisure property, new property developments and vacant land sales may weaken over the next six months as a delayed pipeline of distressed properties begins to liquidate," says Levitt.
"Signs of stabilisation and growth in over supplied sectors cannot be hailed as part of a recovery and may soon recede as an overhang of the shadow inventory of distressed properties waits to enter the market."
The general outlook that the housing market has finally bottomed may well be "premature" optimism.
The single largest impediment to a recovery in the housing market is the large number of loans that are either in a delinquent status or are destined to liquidate.
"We have seen a slowdown in the number of distressed properties hitting the market, but this doesn't mean that the banks have not been developing a pipeline of future delinquencies due to clients who were assisted with short term bond relief.
"One must remember that many banks have assisted their debtors reschedule debt, but if property price inflation levels off for the next 6 months, these debtors will have to start normalising their loans," Levitt added.
"The distressed backlog is due to a longer timeline for loan foreclosures in South Africa", explains Levitt.
"In other words, loans continue to transition into the delinquency pipeline at a rapid pace, but are moving out at a very slow pace."
He said that many distressed loans are "destined to liquidate" and will impact on the recovery but at the same time allow cash-flush buyers the ability to go bargain hunting over the next few months.
"We are concerned that, in light of this housing overhang, the stabilisation we have seen in home prices the last few months is temporary," says Levitt.
"That said, there is a window of opportunity for investors to get into a cheap market that will recover in the medium and long term."
Source: I-Net Bridge
According to SA's largest auction group, sales trading activity is increasing as home buyers take advantage of a slower recovery.
"South Africans are now seeing a repeat of the lengthy property downturn last experienced in the early 1990's. Opportunistic buyers are finding great deals which is boosting trading volume.
"What is unique about this property contraction is that low values are coinciding with low interest rates. It's thus bargain hunting season for those with access to funding," says Levitt.
According to Levitt, the outlook for the second half of 2010 is flat.
The world cup has been a great shot in the arm for local tourism and retail trading but a full property recovery is still 12-18 months off, even in a reasonable interest rate environment and even with reasonable market stability, says Levitt.
"Those who were expecting the South African real estate market to quickly recover in the second half of 2010, after the world cup, may be in for a long wait."
Alliance is predicting a flat real estate market with no increase in value through December 2010.
This is echoed by Absa senior property analyst, Jacques Du Toit, who says that year-on-year growth in house prices may peak soon.
Du Toit says house prices rose by 14,8% year-on-year last month and that Absa was forecasting slower growth at 8% to 9% until the end of this year.
Levitt concurs with this view and believes that from the beginning of next year prices are projected to increase at a stronger rate.
"Depending on global macro-economic trends we could end up running through a strong cycle only next year," warns Levitt, adding that a property contraction can last for several years and house values could move up more strongly or more weakly, depending on any number of circumstances."
"Certain sectors in the residential property market, such as leisure property, new property developments and vacant land sales may weaken over the next six months as a delayed pipeline of distressed properties begins to liquidate," says Levitt.
"Signs of stabilisation and growth in over supplied sectors cannot be hailed as part of a recovery and may soon recede as an overhang of the shadow inventory of distressed properties waits to enter the market."
The general outlook that the housing market has finally bottomed may well be "premature" optimism.
The single largest impediment to a recovery in the housing market is the large number of loans that are either in a delinquent status or are destined to liquidate.
"We have seen a slowdown in the number of distressed properties hitting the market, but this doesn't mean that the banks have not been developing a pipeline of future delinquencies due to clients who were assisted with short term bond relief.
"One must remember that many banks have assisted their debtors reschedule debt, but if property price inflation levels off for the next 6 months, these debtors will have to start normalising their loans," Levitt added.
"The distressed backlog is due to a longer timeline for loan foreclosures in South Africa", explains Levitt.
"In other words, loans continue to transition into the delinquency pipeline at a rapid pace, but are moving out at a very slow pace."
He said that many distressed loans are "destined to liquidate" and will impact on the recovery but at the same time allow cash-flush buyers the ability to go bargain hunting over the next few months.
"We are concerned that, in light of this housing overhang, the stabilisation we have seen in home prices the last few months is temporary," says Levitt.
"That said, there is a window of opportunity for investors to get into a cheap market that will recover in the medium and long term."
Source: I-Net Bridge
Wednesday, 14 April 2010
Overview on South Africa property market
14 April 2010
Where it's at and where it's going.
The South African property market is slowly gaining traction and provided lending institutions loan in a responsible manner and interest rates stay down, the market should grow by a positive, albeit modest, 9% this year.
Despite predictions that the local property market wouldn't start showing signs of recovery until 2010, things started to look up towards the end of last year and the market is already on an upward trend.
We were all prepared for a particularly gloomy 2009 but the market stabilised by September and house prices began rising by the end of the year. We believe that 2009 was nowhere near as bad as had been predicted. In fact, we believe it was actually a relatively good year for the South African property market, particularly in comparison with 2008, which was pretty dismal indeed.
Overall, the volume of property sales rose by 46% and turnover increased by 42%. House prices declined by 5% owing to the first two quarters of the year. Geffen is confident that the housing market will maintain this upward momentum as long as interest rates stay down.
There is still an excess of housing stock, particularly in certain price categories. This is due to repossessions and houses up for sale by owners who found they'd financially over-extended themselves as the recession took hold. Furthermore, stricter lending criteria and the National Credit Act have made it difficult for potential buyers to secure housing loans.
On the whole, there was waning interest in property because people were either too financially-strapped to buy houses or, against the backdrop of what was happening in the global housing market, decided that investing in property was too risky. All of this contributed to a lack of buyers and an over-supply of houses for sale. However, demand is picking up. To give you an example, this year we saw the especially notable sales of a property in Bryanston for R50 million and another in Sandhurst for R35 million. Also, the overall sales volumes being logged by our offices are currently 46% ahead of the volumes recorded at this time last year, and turnover is up a whopping 42%.
A slack in banks' lending criteria would be welcome because it would enable more people to qualify for loans and buy houses.
This would certainly help to stimulate movement and growth in the market. More importantly, it would give more people a chance to own their own home. However, lending institutions must lend responsibly otherwise it could be detrimental.
Geffen's advice to homeowners is to upgrade their properties now while the market is still warming up.
Where it's at and where it's going.
The South African property market is slowly gaining traction and provided lending institutions loan in a responsible manner and interest rates stay down, the market should grow by a positive, albeit modest, 9% this year.
Despite predictions that the local property market wouldn't start showing signs of recovery until 2010, things started to look up towards the end of last year and the market is already on an upward trend.
We were all prepared for a particularly gloomy 2009 but the market stabilised by September and house prices began rising by the end of the year. We believe that 2009 was nowhere near as bad as had been predicted. In fact, we believe it was actually a relatively good year for the South African property market, particularly in comparison with 2008, which was pretty dismal indeed.
Overall, the volume of property sales rose by 46% and turnover increased by 42%. House prices declined by 5% owing to the first two quarters of the year. Geffen is confident that the housing market will maintain this upward momentum as long as interest rates stay down.
There is still an excess of housing stock, particularly in certain price categories. This is due to repossessions and houses up for sale by owners who found they'd financially over-extended themselves as the recession took hold. Furthermore, stricter lending criteria and the National Credit Act have made it difficult for potential buyers to secure housing loans.
On the whole, there was waning interest in property because people were either too financially-strapped to buy houses or, against the backdrop of what was happening in the global housing market, decided that investing in property was too risky. All of this contributed to a lack of buyers and an over-supply of houses for sale. However, demand is picking up. To give you an example, this year we saw the especially notable sales of a property in Bryanston for R50 million and another in Sandhurst for R35 million. Also, the overall sales volumes being logged by our offices are currently 46% ahead of the volumes recorded at this time last year, and turnover is up a whopping 42%.
A slack in banks' lending criteria would be welcome because it would enable more people to qualify for loans and buy houses.
This would certainly help to stimulate movement and growth in the market. More importantly, it would give more people a chance to own their own home. However, lending institutions must lend responsibly otherwise it could be detrimental.
Geffen's advice to homeowners is to upgrade their properties now while the market is still warming up.
Friday, 29 January 2010
First-time buyer segment resilient
There is unflagging improvement in the residential market's first-time buyer segment, which rose from 14% of total buying in Q2 2009 to 19% in Q4 2009.
On top of that, it is expected to rise even further during the course of the year to comprise an even bigger share of total buying.
This was one of several positives in FNB's Residential Property Barometer for Q4 2009.
"The group probably benefits more than many others from the banks' recent relaxation of deposit requirements on home loans, as these buyers are probably a low savings group even by South Africa's weak savings standards," says John Loos, property economist at FNB.
"This source of demand is typically more cyclical than the overall market, and it is expected to rise to a higher percentage of the total in the coming quarters. I expect the growth in this segment to continue for another quarter or two.
"But it won't reach 30% of total buying like in the boom years," Loos said.
The other main positives emanating from the report are the reduction in selling time and greater price realism and affordability.
Where a property took on average 16 weeks and four days to sell in 3Q 2009, this figure dipped to 13 weeks and two days in Q4 2009. "This represents a big decline from the peak of 21 weeks and one day just two quarters ago."
In the final quarter of 2009, survey respondents reported that the overwhelming majority of sellers, i.e. 89%, still had to ultimately drop their asking price in order to make a sale. "This percentage was, perhaps surprisingly, up from the pervious quarter's 83%."
"However, the faster pace of the average sale suggests greater realism, not necessarily in the form of sellers deliberately asking for lower prices, but rather in terms of the demand side catching up, and buyers putting in stronger offers."
On the point of affordability, the report showed that the reasons for selling given by estate agents have begun to point towards a mildly better financial position of households.
"Downscaling due to financial pressure during the fourth quarter declined from 28% in Q3 to 24% in Q4. The percentage of downscaling sellers at the higher end of the market is noticeably less than the lower end."
"Simultaneously, selling in order to upgrade rose further from 12% of total sales to 15% over the same two quarters."
Loos says 52% of agents surveyed anticipate better activity in Q1 2010 when compared with Q4 2009.
But the report also had some negative findings, such as the state of the buy-to-let market, indications that the growth trend is nearing its end and a slight increase in emigration as a selling factor.
Loos said the start of a declining growth trend started appearing in Q4. "We'll start seeing a plateau in the demand for houses as the effect of lower interest rate cuts starts wearing thinner.
However, 2009's fourth quarter still saw positive growth to the tune of 23,7%, which is strong but lower than the 36,8% of Q3.
"The buy-to-let market has showed no significant improvement when its activity is expressed as a percentage of total activity. Its share of total buying is 13%, which is unchanged from 2009's third quarter."
Emigration selling expressed as a percentage of total sales rose slightly from 6% in the previous quarter to 7% in Q4. "This suggests that after the strong downward trend in this percentage, from the 20% high at a stage of 2008, the rate of emigration selling may be levelling out."
On top of that, it is expected to rise even further during the course of the year to comprise an even bigger share of total buying.
This was one of several positives in FNB's Residential Property Barometer for Q4 2009.
"The group probably benefits more than many others from the banks' recent relaxation of deposit requirements on home loans, as these buyers are probably a low savings group even by South Africa's weak savings standards," says John Loos, property economist at FNB.
"This source of demand is typically more cyclical than the overall market, and it is expected to rise to a higher percentage of the total in the coming quarters. I expect the growth in this segment to continue for another quarter or two.
"But it won't reach 30% of total buying like in the boom years," Loos said.
The other main positives emanating from the report are the reduction in selling time and greater price realism and affordability.
Where a property took on average 16 weeks and four days to sell in 3Q 2009, this figure dipped to 13 weeks and two days in Q4 2009. "This represents a big decline from the peak of 21 weeks and one day just two quarters ago."
In the final quarter of 2009, survey respondents reported that the overwhelming majority of sellers, i.e. 89%, still had to ultimately drop their asking price in order to make a sale. "This percentage was, perhaps surprisingly, up from the pervious quarter's 83%."
"However, the faster pace of the average sale suggests greater realism, not necessarily in the form of sellers deliberately asking for lower prices, but rather in terms of the demand side catching up, and buyers putting in stronger offers."
On the point of affordability, the report showed that the reasons for selling given by estate agents have begun to point towards a mildly better financial position of households.
"Downscaling due to financial pressure during the fourth quarter declined from 28% in Q3 to 24% in Q4. The percentage of downscaling sellers at the higher end of the market is noticeably less than the lower end."
"Simultaneously, selling in order to upgrade rose further from 12% of total sales to 15% over the same two quarters."
Loos says 52% of agents surveyed anticipate better activity in Q1 2010 when compared with Q4 2009.
But the report also had some negative findings, such as the state of the buy-to-let market, indications that the growth trend is nearing its end and a slight increase in emigration as a selling factor.
Loos said the start of a declining growth trend started appearing in Q4. "We'll start seeing a plateau in the demand for houses as the effect of lower interest rate cuts starts wearing thinner.
However, 2009's fourth quarter still saw positive growth to the tune of 23,7%, which is strong but lower than the 36,8% of Q3.
"The buy-to-let market has showed no significant improvement when its activity is expressed as a percentage of total activity. Its share of total buying is 13%, which is unchanged from 2009's third quarter."
Emigration selling expressed as a percentage of total sales rose slightly from 6% in the previous quarter to 7% in Q4. "This suggests that after the strong downward trend in this percentage, from the 20% high at a stage of 2008, the rate of emigration selling may be levelling out."
Tuesday, 29 September 2009
Thursday, 30 July 2009
NEW PROPERTY LAUNCH: 'Kelvin Manor', Johannesburg, South Africa
Horizon Consultancy & IPS have joined forces to bring you the 'Kelvin Manor' in Sandton, Johannesburg, South Africa.
This is an up market development on the doorstep of Sandton with units at R699 900 for a 2 bedroom, 1 bathroom apartment. With rental yields above 9%, this is definintely something to consider.
There are 2 ways in which you can become involved:Watch a video for 'Kelvin Manor' This video sets out the development visually & will answer any initial questions you may have.
You can also register for this property launch online so that you may be helped from the comfort of your own home.This registration will allow investors to interact directly with the developers so that any queries are dealt with immediatley.
Points of Consideration for 'Kelvin Manor':
This is an up market development on the doorstep of Sandton with units at R699 900 for a 2 bedroom, 1 bathroom apartment. With rental yields above 9%, this is definintely something to consider.
There are 2 ways in which you can become involved:Watch a video for 'Kelvin Manor' This video sets out the development visually & will answer any initial questions you may have.
You can also register for this property launch online so that you may be helped from the comfort of your own home.This registration will allow investors to interact directly with the developers so that any queries are dealt with immediatley.
Points of Consideration for 'Kelvin Manor':
- 5.7km from Sandton.
- Very little affordable accommodation in Sandton, yet demand for 5000 units.
- Sandton is the Financial Capital of Africa.
- Lifestyle Estate with club house, gym, swimming pool, tennis court, laundry, crèche and within a gated community.
- Walking distance to the Gautrain Station.
- Situated in leafy and green residential neighborhood.
- 2 bedroom, 1 bathroom & 2 parking spaces - R699 900, including costs.
- 100% financing is available.
- R15000 deposit secures !!
If you are interested in buying any unit(s), I will assist you with the entire purchasing process, including the rental management of the unit if you so require.
Eric S Doms
Managing Director
E-mail: eric@horizon-consultancy.com
Mobile: +44 (0)79 0630 9038
Fax no: +27 (0) 86 5292 395
PS: Join us on Twitter or Facebook for the latest property news !!
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