Airbnb trend hiking property sales in Cape Town's CBD
While many areas are beginning to report a notable slowdown, Cape Town’s CBD and City Bowl areas are still just about as buoyant as you could ask for, especially if you are selling an apartment. The phenomenal Airbnb growth trend is just one of the factors driving demand for flats in the area, and activity is still at a notable high, says Warren Emett, Alan Screen and JP Ricketts, Seeff’s CBD and City Bowl team.
Aside from residential buyers, there has been excellent demand from foreigners, comprising about 16% of actual sales in the CBD, and 11% of the City Bowl for the year ending in July.
“The rising demand now is coming from investors looking to capitalise on the rise in prominence of Airbnb,” say the agents.
SA homeowners sigh in relief as repo rate remains unchanged
The decision by the Monetary Policy Committee of the South African Reserve Bank to leave the repo rate unchanged is most welcome in a climate where the economic and housing market outlook remains weak according to Chairman of the Seeff property group, Samuel Seeff, who says save for any major dilemma, it also now seems likely that we will see the year out without any further interest rate hikes.
“The decision means that the repo rate stays at 7% and the base home loan rate at 10.5%. The decision was expected by the market, given that the Consumer Price Index (CPI) has remained fairly stable, albeit still at the upper target range while the currency has regained some of its losses,” he says.
When is a 30-year home loan in your best interest?
Taking out a 30-year home loan needs to be thought through very carefully. However, there are some instances where it can work for a property owner.
“There are a few instances when having a 30-year bond will benefit property owners. However, while a 30-year bond period may seem attractive, it is rarely in the financial interest of a consumer, unless the appropriate level of financial discipline is exercised,” says Tommy Nel, Head of Credit at FNB Home Loans.
“One of the times a 30-year bond would be financially beneficial is if the person is investing in property.”
From a tax perspective, Nel says an investor taking a 30-year loan would be able to claim the interest on their home loan as a deduction against rental income for 10 more years, as opposed to an investor that only took up a 20-year home loan - the success of this depends on whether the person satisfies all the necessary requirements for claiming the interest deduction.
Can Cape Town and Joburg's traffic problem be solved?
Cape Town has been ranked as the 47th most congested city in the world, and the most congested city in South Africa - followed by Johannesburg, according to the 2016 TomTom Traffic Index Report.
Sheldon Jennings, Architect at MaC Architects, says this national increase in traffic congestion brought on by growing urbanisation can be addressed by creating additional business hubs, or so called ‘sub-cities’ outside of the country’s Central Business Districts (CBDs).
Jennings says responsive urban planning is the key to ease traffic congestion.
“Urbanisation has led to towns with core CBDs and main transport arteries flowing outward to suburban areas,” he says.
Your agent should care about you, not just the commission
Property - particularly residential property - represents the single biggest investment that most people will make in a lifetime. “When the time comes to buy or sell, clients want to know, more than anything, that their interests are protected,” says Steve Caradoc-Davies, Harcourts Platinum Principal.
Properly managed, he says a property transaction creates value for all - buyers, sellers and agents.
Is owning property out of reach for young South Africans?
Owning a home is a very South African aspiration. Not only is a home a roof over a family’s head - and a valuable asset that can be leveraged in future - but it also means permanence, belonging and security. It is a unique achievement. In short, homeownership is the dream of a lifetime according to Richard Gray, Harcourts Africa Chief Executive Officer, who says your housing dream is "entitled to the utmost respect".
“Dreams of homeownership are undergoing tough times. In the United States, between 2006 and 2014 - the period encompassing the so-called ‘sub-prime crisis’ - around 9.3 million homeowners lost their homes,” says Gray.