Property 24/10 - 176

ST trustee election and nomination
Sometimes there are errors in judgement made by the current trustees in a sectional title scheme, or there may be disagreements about the running of the scheme and the owners want to drive changes by nominating others to step in.

Trustee nominations and elections can be problematic enough in sectional title schemes, but it becomes even worse when owners elect proxies to attend the annual general meeting or a special general meeting on their behalf to put in a vote to elect a specific person that they want as a trustee, and the proxies don’t attend the meeting, says Michael Bauer, general manager of the property management company IHFM.

There are two types of proxies, an open proxy and a directive one, says Bauer. Usually an owner appointing a proxy to attend a meeting on his behalf would stipulate on the proxy form whether he is giving a specific instruction to that proxy on how to vote at the meeting, but if he doesn’t, the proxy can then vote in whichever way he chooses.

Many people do not realise that if the proxies do not attend the meeting that their vote then automatically cedes to the chairman, who can then end up with the majority vote in favour of the decision he wants to make.

Agent PDE preparatory workshops
Even though the deadline has been extended to 2015 for some estate agents to write their PDEs, it would be wise to get it done now, and not wait until the eleventh hour to complete it.

This is according to Annette Evans, regional manager for the Institute of Estate Agents, Western Cape, who says it is important that agents and principals are aware that the EAAB sent out notification to extend the deadline only for those agents who were licensed prior to July 2008.

There have been many questions as to what to expect and some have battled with the content, she says, and to assist those who are getting ready to write their PDE, preparatory workshops will continue to be held regularly by the Institute of Estate Agents, Western Cape.

This will assist estate agents in preparing fully by knowing more or less what time allocation will be needed for each question, to receive coaching from an assessor as to what to expect in the interview and how to tackle the open book aspect of the exam.

The PDE level 5 session will be on 4th October, and the cost is R550 for members and R650 for non-members.

Home loans and mortgage originators

Owning a home improves one’s life, that of one's family, sense of self-worth and reinforces the breadwinner’s determination to earn enough to keep up monthly bond repayments.

This is according to Tony Clarke, managing director of the Rawson Property Group, who says home ownership in South Africa is increasingly proving to be a stabilising and social force.

“The more South Africans become homeowners, the greater the country’s chance will be of achieving peace and individual wealth accumulation.”

He notes that as a group, an average growth rate of 35 percent per annum over the past three years has seen buyers in lower priced areas such as Kuils River, Mitchells Plain, Grassy Park and Macassar in the Cape, Chatsworth and Cato Manor in Durban, Bez Valley and Buccleuch in Johannesburg, as well as much of Pretoria East become homeowners.

But of course, even in lower priced areas, many buyers are still battling to obtain home loans as there are limited 100 percent home loans available on the market currently.

According to Denver Vraagom from Gunston Attorneys, would-be home loan applicants have to accept that banks act in a highly rational way.

Guidelines for choosing a rental agent
The correct appointment of an agent to manage a property asset is vitally important in ensuring the investment is safe and viable.

This is advice from Louw Liebenberg, CEO of SA’s largest rental transaction processor, PayProp, who says the duty of an estate agent is to ensure that the asset generates the maximum return for the landlord, while being optimally maintained so that it will continue to generate income for the investor for a long period of time.

Liebenberg outlines a few considerations when choosing a rental agent:

Is the Estate Agent you are using really an Estate Agent?

South African law requires that every estate agent be issued with an annual Fidelity Fund Certificate (FFC) in order to be able to trade. This provides assurance to the consumer that should he suffer financial losses due to negligence or fraud by the agent, he is able to claim damages from the Fidelity Fund.

“It is not only illegal for an agent to conduct business without an FFC, but is extremely risky from a consumer’s point of view to engage with someone who is not properly registered to manage what is arguable their largest monthly financial transaction,” says Liebenberg.

Home loans for small business owners
Few small business owners are applying for home loans, however, it is possible for self-employed individuals to increase their chances of qualifying for a loan.

In the height of the property boom in 2007, around 24 percent of new home loan applications were received from applicants who generate income from their own businesses, explains Ewald Kellerman, head of sales at FNB Home Loans.

Such applications where “self-employed” individuals are party to the proposed loan have proportionately halved to just over 12 percent of new applications submitted in recent years, indicating a significant change in the home loans environment.  Even though these figures are based on applications submitted to FNB, the constant and representative market share of FNB suggests that the figure is reflective of a larger trend in new home loan applications for small business owners, he points out.

This trend could further help quantify the financial strain that small businesses have undergone since the 2008 recession.

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