Weekly Newsletter
Friday, 05 December, 2008
Property Search | Estate Agents | List your property

Edition 47 of 2008, Friday, 05 December 2008

Dear Reader

The IPD released the results for the SAPOA/IDP South African Biannual Property Indicator, the first ever, for the first six months of the year and although there is no comparable report for the previous six months there is a clear indication that Real Estate in South Africa has slowed down. "High interest rates, tighter economic conditions and global uncertainty have all played a part. The 2008 figures due early next year will be very interesting.” This according to Stan Garrun (Pictured right), Managing Director IPD South Africa.

But according to the South Africa’s property specialists it is not all doom and gloom and is there indeed plenty good news to end 2008 with!

The last few months have clearly shown that South Africa is not protected from or immune to the global financial problems, says Bill Rawson, Chairman of Rawson Properties - and this has implications for the property market; With interest rates set to drop sooner rather than later now is the time to buy property

The realistic view is that economic pressure will ease shortly: Interest rates are set to come down, the latest economic figures point to lower inflation, and fuel prices are also heading south. Not only will this put extra money in consumers’ pockets, but it will also strengthen consumer confidence, which will impact greatly on the property market.” Young Carr, CEO of Aida National Franchises; 2009: Market ‘set to improve’

There’s a new mood of optimism sweeping through the global property market in the wake of the US election outcome, and it’s generating renewed interest in SA real estate. So says Berry Everitt, MD of the Chas Everitt International property group, who notes that European buyers in particular are keen to invest in SA property once more, thanks to the weakness of the rand against their currencies and the relatively low prices. Foreign buyers flowing back to SA

Among house sellers at this time of the year there is always a tendency to delay putting their homes onto the market until January – but this is a serious mistake, says Lanice Steward, MD of Anne Porter Knight Frank. “Serious buyers,” said Steward, “do not take breaks in their search for a new home – they keep at it until they are satisfied. We have found that the holiday season does not deter for one moment those who are seriously on the lookout for a new place to live”

The history of the discovery of the Free State Goldfields, the most fantastic mineral discovery in South Africa this century, is essentially the history of Welkom, Free State, South Africa for without this world-shattering event Welkom would not have been. The clock must be turned back to the latter years of the nineteenth century when two men, a Mr Donaldson who was a prospector, and a Mr Hinds, an engineer, investigated a portion of the farm called Zoeten-Inval belonging to a Mr Barends Klopper near where the small town of Allanridge is situated today. This was believed to have been in 1896, and the pair were interested in a small outcrop of rock protruding about a foot above the ground and about two feet in length which appeared to be conglomerate pebble reef. A 60 feet pit was excavated and samples collected. The men could raise no interest among mining companies in Johannesburg, which all laughed off the idea of gold in the Free State. Read more in Focus on Welkom, Free State, South Africa

Enjoy!
The editor


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>> Real Estate news - Making property profits in "darkest" Africa

Real estate experts give pointers on making money on the continent.

Many of Africa's leaders lament the lack of foreign direct investment, while foreign investors are deterred by risks that could dent their profit margins.

On a continent where most countries are showing economic growth, how can developers and other property industry players participate in returns without losing their shirts...

>> SA real estate slows: report

The results of the first Sapoa/IPD South Africa biannual property indicator released today show that South African real estate has slowed.

The indicator revealed an All Property total return of 7.3% for the six months to June 2008, led by the industrial sector, which returned 11.1%, followed by offices at 8.1% and the retail sector at 5.9%...

>> Business consultant says property still the simplest, secure asset

The 36 people aged 25 to 36 who recently attended a young investors seminar organised by Greeff Properties at Smith Tabata Buchanan Boyes Attorneys in Claremont learned from Jason Lee, the author of “Making Money Out of Property in South Africa”, that property investment is still the simplest and, in most instances, the securest form of investment available to the man-in-the-street - bricks and mortar, said Lee, will always retain a certain value but this cannot be said of the paper shares of the Securities Exchange (as recent events have shown only too clearly)...

>> With interest rates set to drop sooner rather than later now it the time to buy property

The last few months have clearly shown that South Africa is not protected from or immune to the global financial problems, says Bill Rawson, Chairman of Rawson Properties - and this has implications for the property market.

“Much has been said about how we are not too badly affected by the sub-prime crisis and while this is true it is also true that the South African share market has lost half its value, GDP is dropping by 1%...

>> 2009: Market ‘set to improve’

Property owners under pressure to sell should do all in their power to hang on a little longer.

This is the advice of Young Carr, CEO of Aida National Franchises, who confidently expects that the market will turn for the better towards the middle of next year....

>> Save hard if you want a home of your own

If you’re hankering after a home of your own and hoping to buy before prices start rising again, you better start saving seriously for a deposit.

So says Dr Piet Botha, chairman of the Nationlink estate agency group, who says it is ironic that at a time when the national savings ratio is at an all time low, the banks are now all only awarding home loans on condition that the homebuyer has a deposit of 10 percent or more...

>> Tough economy creates property opportunities

The tough property market has created good opportunities for investors who act on their conviction that better times are ahead.

This is the view of Paul Matthews, principal of the RealNet office in Gordon’s Bay, who says many buyers have recognised the opportunities in the market, with a number of smaller investors returning to the market. “They are capitalising on softening prices to upgrade or to re-invest,” he says...

>> Foreign buyers flowing back to SA

There’s a new mood of optimism sweeping through the global property market in the wake of the US election outcome, and it’s generating renewed interest in SA real estate.

So says Berry Everitt, MD of the Chas Everitt International property group, who notes that European buyers in particular are keen to invest in SA property once more, thanks to the weakness of the rand against their currencies and the relatively low prices...

>> Rawson owners of vacant land should now be looking for ways to develop it

Many hundreds of hectares of vacant land at the Cape still have no development plans because the owners, having possibly paid high for it at the height of the property boom, are now waiting for a revival in property prices before once again considering development.

The problem with this delayed strategy, says Bill Rawson, Chairman of Rawson Properties, is that the dead interest charges will in many cases make any subsequent development unviable...

>> Paying late or never

There has been a significant drop in the number of rental tenants who are paying in full and on time, according to TPN, a registered credit bureau and developer of the industry's first rental payment profile of its kind in South Africa.

Figures for the third quarter from TPN's database show that 54 percent of tenants, compared with the previous figure of 70 percent, are able to meet their rental commitments. This is despite the fact that the rental industry has seen a recent average rental price drop of two percent...

>> SA’s most expensive house sells for R65m

THE country’s most expensive house, according to Alliance Group, was sold at an auction in Sandton last week for R65m.

The home, situated in Sandhurst Estate, Johannesburg, belonged to Africa’s first telecommunications mogul, Rwandan billionaire Miko Rwayitare, who passed away last year in Belgium.

The house is modelled on Pretoria’s Union Buildings with terraced gardens and gatehouses to match. It sold for a mere R400000 at a sale in execution conducted by the sheriff of the court in August last year to the mansion’s architect, Greg Pietersen, after he purchased the property to recover his unpaid professional fees.

However, Pietersen’s acquisition included the company that owned the mansion, Propro Investments, which included Investec Bank’s R67m outstanding finance.

Since the bond was never paid, the no-reserve sale in execution was a culmination of the bank’s legal foreclosure.

Tony Sanchez, Investec’s attorney, says: “The sale arose because no one was paying the bond.”

Rael Levitt, CEO at Alliance Group, says the auction attracted local and international bidders.

“Despite the palpable downturn in the residential property market, this is an iconic property and for many of our buyers they realised that a no-reserve sale of arguably SA’s highest value house was a once in a lifetime opportunity,” says Levitt. He says that since Rwayitare’s widow moved out the estate had been looking “a little tired and neglected”.

>> New housing allowance only second prize

The Revenue Laws Amendment Bill of 2008 proposes an allowance for employers who sell low cost housing to their employees. Briefly, the general idea is that the sale of the low cost housing to the employee has to be on interest-free loan account, for a price that is no higher than the cost of the housing to the employer. The allowance granted to the employer is 10 percent, per annum, of the loan balance outstanding at each tax year end of the employer. Guest columnist and Tax Partner at Cameron & Prentice Chartered Accountants, David Warneke, explains...

>> News from – Nationlink Plattekloof

Are you aware of the fact that certain components of the transfer fees has changed?
Send in by Nationlink Plattekloof

>> To the editor

To the editor:

I am very interested in learning what the market rates are for fees to administer a 26 unit light industrial body corporate in Durban should be. the monthly average levy would be R1100, please email me how much is to be expected and please forward me the contact details of recommended managing agents in the Durban area

Robert

From the editor:

Should you have an answer for this reader you can forward it to news@cyberprop.com

>> In the area...

The areas we are going to take a closer look at this week are;

  • Alberton
  • Pinelands
  • Welkom
>> In the area 1 - Alberton

Buyers seek out Alberton estates

Growing security concerns and resistance to the cost of commuting have given Alberton security estates a boost recently, and underpinned home prices in these developments.

So says Ronell van Niekerk, principal of the local Chas Everitt International franchise, who notes that sales in this segment of the market have remained comparatively brisk with security-conscious buyers gravitating increasingly towards estate tyle living...

>> In the area 2 - Pinelands

High demand for Pinelands rental properties

Demand has soared in recent months for rental properties in the well-established, attractive Cape Town suburb of Pinelands.

That’s the word from Karen Geyer, principal of the local Chas Everitt International franchise, who says there is not enough rental stock currently to meet the demand, which is coming mostly from people keen on the area who have decided to “try before they buy”, and from those hoping for an interest rate drop before they have to commit themselves to a purchase.

>> In the area 3 – Welkom

There’s property gold in Welkom

The Welkom property market is confounding critics by continuing to show solid growth and good investment potential.

That’s in spite of the fluctuating gold price, downscaling of mining activities and the decline in the property markets of most other centres, says Flip Meintjies of ERA Goldfields, one of the latest additions to the ERA South Africa property group’s portfolio of offices.

>> Focus on Welkom, Free State, South Africa

Welkom is South Africa's youngest town and has been the centre of the gold fields since 1947. The town sprung up after gold was discovered on a farm called St Helena.

Welkom has grown perhaps with a faster rate as Johannesburg, yet is proud of the fact that its traffic system of traffic circles were so well designed that they still have only a few traffic lights. It is in the Free State the second largest town and the core of the relatively recent geologic windfall of the Free State...

>> View Properties in Welkom
>> View Properties in the Free State

>> Property of the week

Free State, Welkom, Jan Cillierspark

Bedrooms: 3
Bathrooms: 2
Garages: 1

This home is in perfect condition, no work needed!

Search for property in your area

Enter City/Suburb:
>> Growing objections to time spent cummuting

The last decade has seen a huge increase world-wide in demand for homes that cut down the time spent on commuting – and no doubt this will continue, says Lanice Steward, MD of Anne Porter Knight Frank.

Even in “uncongested” Cape Town, she said, there is now a reluctance to waste time on commuting...

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