Affordable housing market a key component in 2016
Further developments in South Africa's affordable housing market and investments in social infrastructure are key to positive prospects for 2016 according to Corobrik MD, Dirk Meyer, who says they will look to add to the value of South Africa’s infrastructure stock and consumer investment at the housing entry level, where there is minimal disposable income for maintenance.
Meyer says South Africa is experiencing growth in the construction of homes priced between R500 000 and R2 million, targeting the emerging middle class.
"This is the townhouse market that virtually disappeared in 2008, and which is now making a comeback. It offers significant growth opportunities, as outside that arena there has been only a slow, gradual increase in the number of plans passed,” says Meyer.
Local tourists boosting SA holiday property sales
It may only be a thin silver lining, but the steep decline in the rand exchange rate over the past year has given a boost to South Africa’s tourism and the leisure property market according to Rawson Property Group Managing Director, Tony Clarke, who says the low value of the rand against major currencies like the dollar, pound and euro discourages South Africans from travelling abroad, and encourages them to ‘rediscover’ all their favourite local holiday destinations.
He says this has certainly been evident this festive season."
“The beaches were well frequented this December all around our coastline, from Lambert’s Bay on the Cape West Coast right around to Zinkwazi on the KwaZulu-Natal North Coast,” he says.
Is a sole mandate your best bet when selling?
In a sellers’ market, such as the one currently prevailing in many of the high-demand greater Cape Town areas, a seller can make no bigger mistake than to allow a large number of estate agents to simultaneously try and sell their home according to Louis Schoeman, the Rawson Property Group’s franchisee for the Durbanville area, who says this is particularly relevant when the home is in the middle or upper brackets. “To those not familiar with property, it may seem obvious that the more agents you involve in a sale, the better your chances will be of selling it successfully. In reality the exact opposite is the case,” says Schoeman.
Using common sense when interpreting HOA rules
HOA rules are often lengthy, onerous documents to wade through, but they still cannot accommodate all eventualities in a gated estate or housing scheme according to Shan Hulbert, sales manager of Knight Frank Residential SA, who says what should often be a direct application of a rule can become a quagmire of interpretations, but common sense should also prevail.
A typical example is a case mentioned in a Smith Tabata Buchanan Boyes Property Law Update recently, where the rules did not specify provisions regarding the colours of exterior paints that were allowed within the estate.
In this particular case, although it seemed an odd choice, the owners painted lime green stripes on the exterior walls of their home, and the HOA applied for an order to have them remove the stripes.
Buying property together? A contract is essential
While buying a property is often an emotional decision, it should be approached with a businesslike attitude, with all the pros and cons being considered, as well as having a contract drawn up between shareholders in the property according to Anne Porter, head of Knight Frank Residential SA, who says many have said it is often easier to get married than divorced, and the same could be said about co-buying property.
“Often two people choosing to buy a house together will decide they want to invest together. They find a ‘charming’ house and go through the process of buying it, but do not consider beforehand all the implications of doing so,” she says.
What would happen, for instance, if the one were transferred to another province or country and needed the funds from the property, and the remaining person was not able to buy the other out?
Exclusive Use Areas in sectional title schemes
Of the issues that often cause problems in sectional title schemes, the right to the exclusive use of a common area in the scheme, and the rental charged for that use, is often brought up according to Michael Bauer, general manager of the property management company IHFM, who says many feel that they have the right to use a certain area, but are often not happy to pay the extra cost or the cost of the maintenance of this area.
He says it makes sense to charge for the use of the area as this area is reserved for the exclusive use of an owner, and needs to be maintained in some way. If that owner owned the extra portion, he would be paying a higher levy anyway because his participation quota (PQ) factor would be higher, and he would be responsible for its maintenance.