How to decide where to buy - South Africa

Anyone who has ever house hunted is familiar with the feeling of entering a home and thinking: "This is it".

However, says Homenet CEO Martin Schultheiss, while instinct plays an important part in a purchasing decision, it's important to try and remain objective about the area in which it's situated. A dream home could quickly become a white elephant in a declining neighbourhood.

"In this context, an experienced estate agent will be able to impart useful information that should indicate an area's prospects.

"For example, prosperous, well-attended schools are a good indicator of a thriving neighbourhood. Schools that are doing well reflect an active, dynamic community which in turn drives demand for the provision of entertainment and business nodes."

Local shopping centers are also a good indicator of how a neighbourhood is faring. A well maintained, clean shopping centre with bright, modern storefronts denotes a prosperous area. Neglected or empty shops and "closing down sale" signs are not good portents.

The type of outlet is also important, adds Shultheiss. Long-established shops which enjoy good business volumes and offer upmarket products signal stability and prosperity. Second-hand goods shops with assorted jumble, and poorly stocked convenience stores should set off alarm bells.

"Residential and commercial development within the neighbourhood surrounds also indicates confidence in the area. An area in decline is usually sidestepped by developers. And as with shops, the type of development also reveals how an area is progressing."

Buyers should also keep in mind that it is wise to buy a lesser home in a better area than a bigger home in a less prosperous neighbourhood. By doing so, a buyer's risk is lessened and prospects for a good return on investment are improved.

Lastly, he says, buyers should ask for a comprehensive market analysis (CMA) on the property they are considering buying. This should include the area's sales history for the past few years and act as a good guideline as to its future prospects.

ISSUED BY HOMENET

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IT'S ALL ABOUT VALUE FOR MONEY ON KZN SOUTH COAST

 

The residential property market in the middle to lower south coast area of KwaZulu-Natal remains resilient, with value for money one of the region's key selling points, reports Pam Golding Properties.

In Pennington, homes with direct beach access are selling up to around R3.5 million, while those with sea views sell priced mainly up to approximately R1.3 million - sound value when compared with beachfront homes elsewhere. PGP's area principal Stefan Nel says buyers include a mix of upcountry buyers seeking holiday homes which they can share with friends or family, and either small freestanding homes or those within a secure complex for retirement purposes.

"In addition, we anticipate that the new Arbour Town giant shopping mall currently under construction in nearby Amanzimtoti will have a positive impact on residential property along this entire area of the south coast. Further good news is that we have increased our rental portfolio, with an increase in home owners putting their holiday homes into the permanent rental pool. This is coupled with the fact that higher rentals are now being achieved - some 15-20 percent more than previously. Homes to rent offer good value, ranging on average from R3000 for a three bedroom home with single garage to R5000 per month for a good quality four bedroom home with double garage," says Nel.

Further south at Umtentweni Herman and Carolina Reyneke of PGP report that an increasing number of enquiries are from local buyers, including those from elsewhere in KwaZulu-Natal. "We are seeing a marked trend towards those wishing to purchase homes for permanent residence - including retirement - which bodes well for confidence in our area. Buyers are becoming aware of the huge value for money which we offer. For someone looking to retire, an example of the excellent value is a beautiful two bedroom sectional title home within a secure complex which we are currently marketing at just R550 000. This includes its own private garden and undercover patio. The average price of a three bedroom, two bathroom home with quality fittings i.e. a good sized family home, is between R800 000 and R1 million. Umtentweni is an attractive area, popular among professionals, with neat, well maintained homes and neighbourhoods," adds Carolina.

Being more a location for permanent residence rather than a holiday home/holiday letting scenario, the Port Shepstone the property market remains active, with most buyers those at the upper end of the market - either upgrading or investing, report Veshad Pooran and Nirvana Maharaj, PGP area principals. "The value of properties currently being sold ranges from R800 000 to R1.5 million. With some stands in the Port Shepstone area in the region of 2500sqm, we're also currently receiving calls from a number of owners wanting to subdivide stands to sell, in order to reduce their rates bill," comments Pooran.

Further down the south coast Dina Porteous, PGP area principal for the areas Shelly Beach, St Michael's on Sea, Uvongo, Margate, Ramsgate and Southbroom, says in Shelly Beach sales remain steady, with average prices currently around the R1.3 million mark. "Dubbed the gateway of the south coast, the Shelly Beach market is driven by both the residential and the holiday market as it is the 'new area' of the south coast. Gated estate living close to schools and major shopping areas proves a compelling drawcard for permanent residents relocating here from other areas. Uvongo, a more established residential area, offers good buying opportunities for those prepared to do some renovations. Average prices here are up from approximately R915 000 in 2006 to R1.15 million this year. Complexes such as St Michael's Manor in St Michael's on sea offer clients excellent value for money with an average price per square metre of R5500, making them affordable and ideal for retirement."

Porteous says in Margate the sectional title and general residential markets have moved in opposite directions in terms of price appreciation. "While the average sectional title unit is currently around R2.8 million - up from R1 million in 2006, the residential market stands at an average price of around R660 000, down from R1 million two years ago. This could be due to the fact that most of the old beachfront lodges have made way for upmarket beachfront apartments for sunseekers, resulting in the Margate residential market 'moving' to Shelly Beach. One of the most consistent markets in the area, Ramsgate's sales remain stable as does the average price of approximately R1.2 million. With its lush gardens, well organised ratepayers' association, good community policing, shopping centres, school and long stretches of beachfront this area is safe and central for both permanent and holiday markets."

She says upmarket Southbroom, with its top golf course and well kept common areas, attracts the high end buyer particularly those seeking a tranquil coastal hideaway, and the property owners' list reads like a who's who. "Although there are very few sectional title properties available the attraction here seems to be for gentleman's residences, three of which are currently marketed under sole mandate by PGP, priced between R8.5 million and R15 million. These quality homes offer outstanding value for money and it's not often that buyers have this opportunity to own the best the area has to offer," says Porteous.

In the Port Edward area, PGP's Cathy du Plessis says most buyers seeking property in the area are cash buyers, looking for good buys for investment. She says there is also interest in vacant land mainly from upcountry buyers - again mainly for investment purposes. "Enquiries generally are for tracts of land in the region of 22 000sqm and priced around the R3 million mark, which represents good value for money as these sites tend to be around the golf course, with sea views etc. This bodes well for future development as these are savvy investors with an eye on the future, securing land with a view to development when the market is ready." She says in addition, there remains a steady demand for homes for permanent letting, mainly in the R3 500 / R4 000 per month price range.

For further information contact Pam Golding Properties as follows: Pennington 039 9751110, Umtentweni on 039 6952466, Port Shepstone on 039 6825082/3, Port Edward on 039 3111531 and Margate on 039 3173003.

 

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Rent, extend repayments, but don't sell Gerhard Kotzé

Many homeowners are under tremendous financial pressure to sell currently but the advice from the experts is to hold on to your existing property or at the very least stay in the property market.

Gerhard Kotzé, CEO of the ERA South Africa property group, says this may not be easy, what with the multiple whammies that have impacted on household expenses, but that it would be an enormous mistake to sell under pressure and take a bath financially.

“History tells us that property always bounces back. The danger is that if you sell now you may not be able to get back into property when the market improves and prices begin to rise.”

He says the “survival kit” for homeowners who find themselves in difficulty should address both property issues directly as well as household expense issues.

“For example a sensible trend we’ve picked up, is that of homeowners renting out their large properties and moving into smaller rental homes to cut their living expenses.

“Other options are to extend your bond repayment period or arrange to pay only the interest portion of your bond. Generally banks are surprisingly open to such arrangements, but it is vital not to miss any bond repayments to avoid undermining your credit rating.

“Moreover, you must avoid adding to your debt, especially if you opt to consolidate your debts into your home loan account in order to benefit from the lower rate of interest.”

Other suggestions from Kotzé include keeping a tight lid on your spending, selling off a second or third vehicle, trading down to a smaller car, shopping in bulk, working from home one or two days a week to cut transport costs and joining a lift club.

 

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RARE BEACHFRONT PROPERTY FOR SALE IN ARNISTON - South Africa

 

They call it the Gem of the Overberg, and finding beachfront property for sale there is as rare as hen's teeth. Residents of the sleepy seaside village of Arniston are fiercely protective of their secret hideaway, so it's no wonder that the number of homes changing hands has been well under 20 for the past 5 years and more. Obtaining a home on the beachfront Harbour Road is an almost impossible feat, as such houses are typically kept within families for generations. However, Pam Golding Properties is now able to offer one such rare opportunity to buyers, with a price tag of R10.9 million.

Situated at the very edge of the town, with only one neighbour, the house has three bedrooms, making it ideal for either permanent seaside living or for a family holiday home. The potential for holiday rental income is also significant. The neat home has two bathrooms and a large reception room, plus a single garage and an enclosed braai area, providing lovely views as well a shelter from the wind. A wide wraparound stoep on three sides of the home offers panoramic ocean views. The 833sqm plot has direct access onto Roman Beach - Arniston's main swimming beach.

PGP's MD for the Boland and Overberg, Annien Borg, says with its location just over two hours' drive from Cape Town, Arniston is an ideal weekend getaway spot for city-dwellers. She adds that the village is also popular as a holiday retreat for up-country residents, who relish its white sandy beaches and warm, sparkling waters. "Abundant sea-life and birdlife make this an ideal spot for nature-lovers," says Borg, "with whale-watching and spring flowers competing as the main attractions in the spring months. The traditional whitewashed fisherman's cottages at Kassiesbaai have been declared a national heritage site, and are hugely popular as a subject for South African artists and photographers. There is also a wealth of opportunities for lovers of the outdoors, from hiking to sailing, mountain-biking, fishing and swimming, or exploring the huge low-tide cave from which the village draws its alternative traditional name of Waenhuiskrans. Divers can explore the numerous wrecks in the area - including that of the British ship the Arniston, which sank in 1815 in one of this country's most serious disasters ever, with close to 400 lives lost." Borg adds that Arniston is also well placed for day trips to Cape Agulhas, Struisbaai and Bredasdorp, which is just 15 minutes' drive away, and offers sporting facilities including a golf course.

PGP's area manager for Arniston, Le Roux van der Merwe, says there are only some 600 homes in the entire village - and seeing as it is surrounded by nature reserves, there is little potential for further expansion. Indeed, previous attempts at sub-division of existing properties have been regularly refused, and residents fight hard to preserve the unique character of the village. This fact, combined with Arniston's growing popularity as a holiday destination, mean that property values have increased more than 20 percent over the past five years. "Homes in the streets set back from the sea now fetch around R2.5 million to R3.5 million," says Van der Merwe. "On the rare occasion that a vacant plot goes up for sale, it can fetch anything from R1 million for a plot without a view, and upwards of R4 million for a 500sqm plot closer to the sea. But these opportunities are few and far between. It is also extremely rare for beachfront homes to come onto the market - although we have had two come up for sale this year, which is highly unusual. The first was sold by PGP for its full asking price of R7.96 million, and we anticipate that this second home on Harbour Road will also achieve its full asking price. We have a lot of cash buyers - both holiday buyers and investors - clamouring for homes. And of course there is always demand from existing residents who want to acquire second properties for their family members."

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Alliance Group to Sell Luxurious Home on the Vaal River's Millionaire's Bend

South Africa's leading asset sales and services company, the Alliance Group,
will soon be selling a prime home at Marlbank, in the heart of the Vaal
River's Millionaire's Bend. With 55 kilometers of South Africa's most
dynamic and permanently navigable inland waterway on your doorstep, this is
a water-lover's dream home.

This extraordinary home, just over an hour from Johannesburg, is right on
the river's edge and offers the ultimate in exceptional and luxurious
detail, with a rare blend of opulence and tasteful livability. The property
is situated on 3.27 hectares with river frontage and rolling paddocks
housing stables with five horses. An exquisite home, it has approximately
1500 square meters under roof, including outbuildings, with five bedrooms
all with bathrooms en suite. Four of the bedrooms overlook the river and one
bedroom overlooks the stables and green-lawned estate.

Features of the home include a spectacular entertainment area and
wrap-around bar; as well as a lovely dining and sitting area with private
lounge and huge built-in gas fireplace. The open-plan dining room leads onto
a gourmet kitchen with an open serving area to the bar. Other features
include a scullery, glass cellar, study and a gym.

Amenities include the stables with tack room and lunging ring, a swimming
pool overlooking the river, a boathouse, intercom and fully-wired computer
network. There is also a borehole, alarm and security system - and last but
not least, beautiful landscaped gardens and magnificent staff quarters for
four staff members. The architects were Howard Johnston Architects.

There's no doubt that this is a fine home, ideal for getting away from it
all - plus a good investment. Warren Aronson of Alliance Group comments:
"The property offers an ideal opportunity to live in the country, but close
enough to work in the city''.

The auction will take place on site on the 30th October. The property can be
viewed on the 11th and 18th October.

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Harcourts enters South Africa

Harcourts International Ltd today announced a joint venture with a major South African real estate company, Homenet Group, in its “most significant” step overseas since it established Harcourts Australia more than ten years ago.

Harcourts is taking a shareholding in the local company, and licensing them to use its brand and systems over the next twelve to eighteen months.

Harcourts executive director Paul Wright says, “Homenet is one of the top five real estate organisations in South Africa with over 130 offices throughout the Republic. Partnering with them is a truly exciting step for Harcourts, continuing the strong international growth of our brand, moving closer towards our goal of being one of the world’s leading real estate franchise.”

Full Article Here: http://www.nbr.co.nz/article/harcourts-enters-south-africa-35403

 

Homes, boats and planes attract "fractional title" interest - South Africa

Fractional ownership in South Africa is generally perceived to be exclusively applied to luxury vacation residences; however, the concept is now also being applied to luxury leisure use assets such as helicopters, private planes and boats delegates attending the recent 3rd Annual Fractional Ownership Conference in Cape Town were told by Dirk Wilson, co-founder of fractionalownership.co.za and organiser of the conference.

One Johannesburg company had sold six private planes by fractional ownership and was busy selling their first helicopter; a Cape Town company had recently completed the sale of a R15m luxury cruiser on fractional and was now moving onto their second boat.

Wilson also outlined the number of active players selling assets on fractional ownership in the South African market: vacation residences – 34 companies with 120 plus different residences in more than 41 destinations throughout Southern Africa; one company with seven aviation products; two companies with two top-end boats, and one company putting final touches to their super-car club.

The number of fractional ownership companies involved in the residential sector had dropped dramatically in the last six months. “There were 64 companies active in the residential market six months ago, which has dropped to 34 today. This is a good thing, because it was evident that there was something of a ‘gold rush’ to market. Droves of developers and agents had the perception that a residence that was not selling on the whole ownership market would automatically sell on the fractional market. They could not have been further from reality.

“To operate in the pre- and post-sale fractional market, you will be required to implement management and hospitality support infrastructure for a minimum of 20 years. For the South African market to maintain long-term sustainability and keep its position as the world’s second most established fractional sector (after the USA), it is imperative that new entrants in the market understand what their long-term obligations to their projects are, and are prepared to conduct essential research before they launch a product into the market.

In terms of the volume of fractional residences available on the market in Southern Africa, South Africa has the lion’s share of the market (90%), Mozambique 3,3%, Mauritius 2,5%, Seychelles 1,6%, Tanzania 1,6%, and Namibia 0,8%. In South Africa alone there are an estimated 41 lifestyle destinations/resorts, towns and areas where fractional ownership residences are available. When looking at the volume of residences by province, this time the Western Cape has the lion’s share with 47%, KZN 18%, Limpopo 15%, Eastern Cape and Mpumalanga 5% each, Northern Cape and Gauteng 3% each, and North West and Free State 2% each.

Wilson says there is global interest in Southern African fractional offerings, as recorded on fractioanlownership.co.za. “Most (74% of total enquiries) some from South Africans, and then, in descending order, from the UK, USA, Canada, Australia, The Netherlands and United Arab Emirates.

 

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House boat for sale - Knysna, South Africa

"Barely Awake" is a self catered House boat on the Knysna Lagoon. It’s big enough for 4 adults, 1 child. It has a fully equipped kitchen and complete bathroom facilities. Appreciate the beautiful lagoon while braaiing on the deck, suntan or snorkel and dive from the comfort of your home on water. The boathouse is moored in the Knysna Harbour at the Waterfront. Step onto the shore and explore the shops, restaurants, galleries at the Waterfront, or just take a ten minute walk to the town. Boat is fully equipped and will suit anyone that is a Nature lover. 

 

 

Luxury living on Clifton Beach - South Africa

"LIVING THE DREAM IN A UNIQUE SOPHISTICATED WATERS EDGE APARTMENT"

This superb apartment with four bedrooms, 4 bathrooms all es., has two levels, with magic views of the CLIFTON BAY and THE 12 APOSTLES!   The bottom level has a self contained unit with it's own entrance, with it's own POOL, JACUZZI on a large terrace. It also has a SAUNA.

The top level has an exceptionally large entertaining area, flowing onto an expansive terrace.

 

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City welcomes R1,2 billion development in CBD

The 3 500m²  property is situated between Hans Strijdom Avenue and Mechau Street along Buitengracht Street with a very prominent and strategic location at the entrance to the city.    

According to Councillor Simon Grindrod, Mayoral Committee Member for Economic, Social Development & Tourism, this will be Cape Town’s single biggest development since the establishment of the Victoria & Alfred Waterfront.

The Malgas site was sold by the City in May 2007 to the Old Mutual Property Group for over R89 million.

At the time  Executive Mayor  Helen Zille said that this initiative was an excellent example of “how the private and public sector could work together in realising the City’s strategic objectives of economic growth and development”.

The City’s Spatial Planning, Environment and Land Use Management Committee (SPELUM) has now approved the height waiver which will allow the development to go ahead.

“This is another illustration of how the public and private sector can work in harmony to create investment and jobs for the residents of Cape Town ".

“The City welcomes the mixed use development of hotel accommodation and commercial space. With a height of about 150 meters, it will be the tallest building in Cape Town. The allowable bulk is approximately 60 000 square meters, which is another record.”

“The development will comprise 33 000 m² of offices, 14 500 m² of hotel accommodation and 2 500 m² of retail space. This is a significant show of confidence on the part of South Africa’s largest financial services company in Cape Town’s CBD,” says Cllr Grindrod.

According to Mansoor Mohamed, the City’s Executive Director: Economic, Social Development and Tourism, this is Old Mutual’s largest project in Cape Town to date.

“The City of Cape Town is busy implementing an infrastructure led economic development strategy.  I am very satisfied that it took such a short time of 12 months to progress this transaction.

“The development is important for a variety of reasons including the social and economic benefits. One of the conditions of sale was that Old Mutual should prioritise the building of 564 residential units and a retail and commercial development of about 6 000m² on a 10 hectare property in Khayelitsha.

“This is an example of how the City will use strategic parcels of land to stimulate economic growth in areas where it is most needed. The City welcomes the additional hotel and office space that will lead to more jobs for the economy of Cape Town. I would like to commend my colleagues in the City’s  Planning  Department for a job well done,” says Mohamed. 

Released by the Communication Department, City of Cape Town

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SAN LAMEER REMAINS A POPULAR DESTINATION FOR FRACTIONAL OWNERSHIP

Recognised as a well-established and highly successful golf and beach resort, San Lameer on the KwaZulu-Natal south coast has proven to be one of South Africa's most popular destinations for fractional ownership, says Werner Geyser, sales consultant for Pam Golding Fractional Ownership. San Lameer is minutes from the popular resort town of Margate, 20 minutes from the Wild Coast Casino and a scenic 75 minute drive from Durban.

"This is not surprising given the sound return on investment enjoyed by fractional owners at San Lameer. Furnished to high standards and each including a golf cart, our two bedroom and three bedroom units have enjoyed excellent occupancy rates of 73 and 65 percent respectively during the year to date (2008), both of which include usage by owners as well as rentals via the rental pool," he says.

"In terms of two bedroom units, owners used 60 percent ie 17 days of their allocated four weeks (ie 28 days) with the remaining 40 percent placed in the rental pool - of which 33 percent of the bed nights were rented out at an average of R1600 per night providing an income return of R6000.

Taking into account an owner's usage of 17 days at this same rate, this translates into a usage value of R27 200. In other words you have foregone the income by making use of the villa yourself, however you would have paid a similar rate to have enjoyed the same amount of holiday time in a similar holiday destination. As a result your return on a two bedroom share (fraction) at a cost of R260 000, the usage plus rental represents 13 percent.

Similarly, regarding the three bedroom units, owners used 50 percent ie 14 days of their allotted weeks with the remaining 50 percent placed in the rental pool - with 28 percent of the bed nights rented out at an average of R2200 per night. With 14 days' usage affording a usage value of R30 800 and the rental income representing R8800, the return on a three bedroom share of R299 000 represents 13.2 percent.

Geyser says over and above this, over the past three years an average escalation of 15 percent in the price of the shares at San Lameer has been achieved, further enhancing the value of this fractional product. As a result, not only is the purchaser minimising his/her holiday expenditure, the leisure asset is also appreciating as the share is underpinned with real property value. Fractional ownership also provides access to what may otherwise be hardly affordable, luxury destinations, whether these be golf, seaside, game farms or an international destination.

With breathtaking scenery, tranquility and seclusion, San Lameer is a conservation haven with 195 different bird species, abundant wildlife and indigenous fauna and flora, a championship golf course. Currently Pam Golding Fractional Ownership are marketing fractional shares in a luxurious two bedroom, two bathroom villa with a spacious, open-plan design flowing to outdoor areas, covered terraces and including a surround-sound entertainment system, flat screen television, air conditioning and a two-seater golf cart.

 

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KUILS RIVER HANDOVER A FIRST IN WESTERN CAPE HOUSING

Named by the SA Housing Foundation as the 2007 housing project of the year for units over R80 000, Stellendale Village is the first project in the Western Cape to fully integrate and evenly spread subsidized GAP houses throughout a larger private sector project.  Peter Grobbelaar, projects director of Visual International, the developer, says that the private/public partnership incorporated in Stellendale Village means a total of 140 houses will be sold to qualifying purchasers of GAP houses, nominated by the Department of Housing of the Western Cape Province.  They are being sold for R350 000 each and will be integrated with the other homes throughout  the remaining phases of Stellendale Village in terms of a land availability agreement with the department.  Grobbelaar says they look like the other homes in Stellendale Village, priced at up to R650 000, and have exactly the same finishes and specifications. 

 

The village which will ultimately comprise 1 500 homes, is located adjacent to Stellenbosch Arterial Road in Kuils River in growing community served by a hospital, seven public schools and three private schools.  It is within walking distance of a major new shopping centre and within 2  km of the R300, 8 km of the N1 and 5km of the N2.

 

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FNB House Price Index, by John Loos (Part Two of Four)

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However, once the prices at the higher end had adjusted sharply upwards, driven by the surge in demand, the upward demand shift subsided and many buyers may have even started to look towards the lower end for better value for money. This year, the gap in inflation rates between the median and mean has first narrowed, and then the median inflation rate has overtaken the average price inflation rate, which suggests that major demand shifts up or down the price ladder may be over for now, and that the superior performance of the lower end is all but over. While rising interest rates may have been encouraging a portion of home buyers to look at cheaper market segments, against that a portion of lower income groups may be temporarily dropping out of the market altogether due to their financial strain, thereby offsetting any demand gains that the lower end may be receiving due to the downward shift. Lower income groups are believed to be experiencing greater financial strain than their higher income counterparts due to being harder hit by high food and transport cost inflation (lower income groups spend a higher portion of their income on such items) in recent times. STABLE PERFORMANCE Therefore, the recent relatively stable performance of the median price inflation rate in recent month is probably not yet an indication of the market deterioration coming to an end, but rather an indication that the activity levels of the higher end are improving in relative terms compared to the lower end causing a relative upward shift in activity (note that in absolute terms higher and lower end activity levels have probably still been declining in recent months). The average price index’s declining inflation trend is probably a better indicator of the overall market and price trend, i.e. still weaker. However, there may be some use in comparing the trends of mean and median indices compiled from the same data set, because divergences between the two may prove insightful in terms of relative shifts in activity up and down the price ladder. AUGUST AVERAGE PRICE As at August, the average price of a house transacted according to FNB’s sample of the market was R680,541 while the median price was R548,874. In reality, though, both measures are over-estimates of what the average house value in South Africa actually is. This is because higher income households are generally more mobile than low income ones, which means that a greater percentage of total stock gets traded in middle-to-upper income areas as opposed to, for example, former black townships. Given that both of the above indices are based on properties transacted, it stands to reason that the middle-to-upper income end will have a significantly higher weighting in the indices. In reality, therefore, if we could value every existing property down to RDP housing regardless of whether it gets transacted, the average and median values would be significantly lower. Therefore, while such house price indices are useful from a trend analysis point of view, they are of limited value in calculating average values for the country, as they only incorporate houses that get transacted. End of Part Two of Four   Click here to read more property related articles

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Property investment opportunities offered by MyProperty and Callidus Wealth creations - South Africa

MyProperty recently joined in a venture with Callidus Wealth Creations to offer investors great investment opportunities.  These unique investment opportunities offered by MyProperty and Callidus Wealth Creations guarantees great returns on your investments in areas such as Akasia in Pretoria, Mitchells Plain and Ermelo.

 

Lotus Gardens:

 

Lotus Gardens syndication investment offers a minimum of 25% return on capital invested through our buyback guarantee. Units are purchased at a value of R507,000 which according to valuators and market analysis are approximately 5% under estimated market value.

Whats on offer:

• Purchase 25% share in a residential property syndication
• Investment term of 2 years
• Investor buys security in 25% equity stake
• Buy-back guarantee on property to secure guaranteed growth

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Mitchells Plain

 

Invest in Western Cape properties, while generating a positive cash flow and get returns of 39% per year. These investment opportunities are in the dynamic coastal area of Mitchells Plain in the Western Cape.

Whats on offer:

• Purchase 50% in a residential property syndication
• Returns on capital of up to 30% per year
• Returns on property of up to 39% per year

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Stone Era

Stone Era is uniquely situated to be an ideal property portfolio builder, with above average yield on rental income, solid capital growth and vastly expanding infrastructure in the Ermelo area. It is the ideal product for a seasonal property investor or an investor new to the property market.

Whats on offer:

• Purchase a rental unit below market value
• Cash back to minimize shortfall on repayment
• Long term investment opportunity
• Rental yield of approximately 0.8%

Click here to view full brochure

 

 

 

 

 

FNB House Price Index, by John Loos (Part One of Four)

The newly-developed FNB House Price Index shows August house price inflation to the value of 2,3% year-on-year, compared with 3,5% in July. This continues the trend of steady deceleration in year-on-year price increases since early this year, while on a month-on-month basis the index has been showing price deflation since March of this year. The August year-on-year inflation rate is the lowest since January 2002.

In order to obtain an idea of house price trends in real terms, the FNB House Price Index has been deflated with the consumer price index. In year-on-year terms, July saw an 8,8% real price decline, which was the 18th consecutive month of year-on-year real price decline starting back in February 2007.

DRIVERS

The list of negatives for the housing market has gone far past merely including rising interest rates. It has been the combination of rising interest rates and a rising household sector debt-to-disposable income ratio that has driven up debt servicing costs relative to household sector disposable income (debt service ratio).

In tandem with rising debt servicing costs, rising consumer inflation, notably in the areas of food and transport costs, has been eating into disposable income in recent years, while disposable income growth may also be suffering at the hands of a slowing economy which hampers job creation as well as the discretionary portion of employee remuneration.

If the above was not enough, a few key sentiment dampeners have seen an apparent surge in emigration, further hampering residential demand. Minority group concerns following a change in ANC leadership at Polokwane may have played a role, as could the Eskom crisis that played out in January, and don’t underestimate the Zimbabwean Crisis influence.

Periodically, the debate arises as to whether the median price or the average price is a better indicator of property price trends and average levels (though one must not ignore methods such as the repeat sales index).

MEDIAN PRICE

We have calculated a median price from the same data set in order to compare with the average price. While there is some difference, both tell a not too dissimilar a story. What is noticeable though is that for much of the period July 2001 to end-2005 the median price inflation rate was above that of the mean (average), while this situation reversed in 2006 and 2007. When the median inflates above the average, it can point towards an activity shift towards the higher priced end of the market, a shift which can tend to inflate the median price at a more rapid rate than the average, whereas a shift in activity towards the lower priced end can see the median inflating at a lower rate than the average (2006-07).

These two periods of activity shift, first to the higher end and then later back to the lower end are indeed believed to have taken place during the current decade. The demand shift to the higher end of the market during the initial part of the property boom was triggered by rapid interest rate cuts. Prior to upward price adjustments, lower interest rates suddenly made it possible for credit buyers to afford higher priced houses than had previously been the case, and understandably many climbed in.

End of Part One

 

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PRIME PROPERTY IN CORPORATE PARK NORTH TO BE SOLD

South Africa's leading asset sales and services company, the Alliance Group,

is excited to announce the imminent auction of a prestigious property in

Corporate Park North. This light industrial park has a prime position on the

N1 between Johannesburg and Pretoria, located between Olifantsfontein and

the Samrand off-ramp. It has great exposure with fantastic signage

opportunities onto the N1.

Not only does Corporate Park have an unbeatable location, it also has a

fantastic mix of tenants and owner occupiers plus a very good security

infrastructure. The property for sale is a newly-built warehouse and office

development and is a gem for any corporate looking for space between

Johannesburg and Pretoria.

Currently there is a large office component measuring approximately half of

the gross building area. The option to convert the offices back into

warehouse space will not be a challenge. The net floor area is 9 565m2 and

is situated on two hectares of land. The property has been very well

maintained and current gross income is R400, 000 per month.

The present tenant is Telkom and the lease expires at the end of December

2008. The property is going on auction on the 17 September 2008 to be sold

with vacant occupation. It is perfect for an owner-occupier who wants a

world class office and warehouse headquarters with top class exposure onto

the highway in the Midrand area.

"The industrial market has been very strong of late and many large users are

still demanding further space. Properties of this calibre are very rarely on

offer and this landmark property will no doubt grow in value well into the

foreseeable future," says Neville Bear of the Alliance Group.

 

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