Are you ready to buy property?
While homeownership has become the goal for many South African consumers, buying a home too soon without completing the necessary research can leave homeowners with a very expensive noose around their necks.
This is according to Adrian Goslett, CEO of RE/MAX of Southern Africa, who says purchasing and owning property has many benefits while also providing a sense of stability and the freedom to make decisions regarding what happens to that property.
Whether the owner wants to renovate or rent the property out, the choice is theirs, he says -however, along with the freedom home ownership brings, there are more responsibilities as well as additional costs that buyers should consider before entering the market.
Goslett says that the first step for a buyer to consider when assessing whether they are ready to purchase a home is to see what they can afford.
Timing issues for buying and selling
South Africa is a country where property ownership was denied to more than 50% of the population in earlier days, hence the onus on sales people in the industry to educate buyers and sellers as the population gets more active and entrenched in property transactions.
The past two decades, with a new Constitution in place, allowed for a number of new consumers trying their hand at the game of property. Most of those clients entered the market with a clean slate; a statement which relates to a buyer with cash on hand or a loan from the bank.
The arena, however, has not been closed to the older hands in the game, which include those property owners who move from one location to another, be it for the reason of upgrading, going smaller or retiring.
Most of the population in this segment, as a general rule, shop around until they find a new home, then only take the bold step to sell their home and move on.
Rental debt collection increases in SA
Tough economic conditions in South Africa have seen an increase in the number of cases that legal firms offering debt collection services handle.
According to Ntombi Mlambo of Gunstons Attorneys, the big challenge facing legal firms is tracing the debtor.
She explains that there is a tendency especially among landlords and rental agents to heave a sigh of relief when a poor tenant leaves and to write off large sums owing – because the new address to which the defaulter claims he will be moving too turns out to be bogus and by the time a summons is served, the tenant will have moved on.
Mlambo says in situations such as these, defrauded landlords do no one a favour by letting a defaulting tenant get away with non-payment because experience shows that they will do the same thing again.
Owners in the sectional title sector have in the last year also been slack about meeting levy payments and they currently comprise a very big share of the defaulting group with which South African debt collectors are dealing with, she says.
Wealthy individuals favour property
Global economic problems have failed to curb the rise in the number of wealthy individuals, according to the Knight Frank/Citi Bank Wealth Report.
The 2012 report reveals that there are now 63 000 people worldwide with US$100 million or more in assets and the number of centa-millionaires has increased by 29 percent since 2006.
What is more, predictions indicate that the number of high net worth individuals (HNWIs) will continue to rise, says Lanice Steward, managing director of Anne Porter Properties.
Steward explains that the Wealth Report shows that for HNWIs property continues to be the most favoured asset class, accounting for approximately 31 percent of all their assets, an increase of some 3 percent on last year.
Innovative app for agents launched
At a launch at the Table Bay Hotel, Realtors International agents and associates were introduced to an app that the company believes will impact greatly on the property industry.
The company has spent the past year developing an app – currently on iPad but will be on other platforms soon – that will free agents to spend more face-to-face time with their clients.
“We believe in technology as a tool to build the personal connections that our agents can then excel in,” says Toni Enderli, Chief brand officer of Realtors International.
Lewis Pugh, environmental campaigner and maritime lawyer, best known for his ice water endurance swims, was the keynote speaker at the launch.
Speaking at the event, Pugh made the point that just because something has worked in the past doesn’t mean it always will, and for real change to happen, in the environment and in business, we must change our mindset.
More building plans approved in SA
The value of recorded building plans passed at current prices was 4.7 percent higher (R442.5 million) during January to February 2012.
According to Statistics South Africa (Stats SA), this figure was high when compared with January to February 2011.
The February report on building statistics reveals that increases were reported for residential buildings (27.3 percent or R965.1 million) and additions and alterations (6.8 percent or R209.5 million) compared to a decrease reported for non-residential buildings (-26.5 percent or -R732.0 million).
Six provinces reported year-on-year (y/y) increases in the value of building plans passed during January to February 2012.
The increase in the value of building plans passed was dominated by Gauteng (contributing 5.9 percentage points or R552.7 million), followed by Western Cape (contributing 2.4 percentage points or R221.1 million), Free State (contributing 1.9 percentage points or R174.3 million) and Northern Cape (contributing 1.5 percentage points or R139.4 million).
SA must-buy cheap & designer homes
With the residential property market said to be a buyers’ market currently, homebuyers can choose from affordable to designer homes depending on price and location.
Pam Golding Properties (PGP) says buyers can still snap up homes and enjoy a trendy lifestyle in the southern suburbs at more affordable prices.
The agency says affordable homes are located in one of several stepping up suburbs located on the area’s eastern edge.
Howard Markham, PGP area manager for the southern suburbs, says there are a number of properties in areas such as Rondebosch Park Estate or Lynfrae, which are located close to expensive neighbourhoods at significantly lower prices.
He says Rondebosch Park Estate is a small suburb popular with families, with prices ranging between R1.5 million and R3.5 million.