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24 October 2013

The absence of a written agreement could mean no commission
Knight Frank - South Africa
Once again, a court case has come up where there is a dispute over commission paid on the sale of a property and it has become quite clear that sellers must be prepared to sign a mandate with their estate agent and should not think it unreasonable for the agent to ask for this, says Lanice Steward, managing director of Knight Frank Residential SA.

In line with the Consumer Protection Act and the need for complete disclosure, a seller must be willing to give complete information on the state and condition of the property he is selling, she said.

It is prudent, because the CPA has not been tried and tested in court with regard to a seller, who is an individual selling his property and not a vendor, i.e. a developer, to ensure that there is complete and honest information given to the buyer on the condition of the property, she said.

At the same time, it is not unreasonable of an agent to insist on the signing of a mandate and discussing the commission payable on the sale of the property before he starts marketing it, she said.
Knight Frank

Ratepayers 'ignored by eThekwini council'
IolProperty - South Africa
Durban ratepayers' associations are becoming increasingly frustrated over the lack of response from the council about problems in their areas.

And this week The Independent on Saturday experienced the same difficulties after trying since Thursday to get a response from council about the ratepayers' concerns, without success. City spokesman Thabo Mofokeng, despite promising to respond to The Independent on Saturday about the queries, had not done so at the time of going to press.

Greenwood Park ratepayers' association chairman Clinton Kirk said he had been trying to have problems in his area fixed for more than a year. 'Despite many letters, e-mails and calls, you can't get through to the city manager's office,' said Kirk.

He has documents dating back to last year, for which he has had no response to any of the issues raised.

The issues include requests to widen Rosary Road owing to increased traffic from Nandi Drive, requests for repairs to Skye Road have not been responded to, and urgent action to stop damage on Chris Hani (North Coast) Road have also not been heeded.
IolProperty

Challenges that today's homebuyers face
Moneyweb - South Africa
Homebuyers need to focus on paying down debt to improve their affordability levels.

While current conditions are prime for purchasing property, many of today’s would-be homeowners - especially the younger generation - are struggling to take advantage of the opportunities in the current property market, says Adrian Goslett, CEO of RE/MAX of Southern Africa.

He notes that although favourable interest rates have been prevalent in the market for the past few years, high debt-to-income ratios have held many potential homebuyers back from realising their goal of owning a property. “Affordability is a key factor when it comes to obtaining the necessary finance for purchasing a property, and the fact is that many consumers in today’s market simply don’t have the affordability ratios required by the banks. This is largely due to the continually increasing cost of living and the exceptionally high levels of debt that South African consumers have. According to the South African Reserve Bank’s quarterly bulletin, the amount of debt owed by consumers as part of their income was 75.6%. What this translates to is that for every R1000 consumers earn, around R750 is going towards paying back debt,” says Goslett.

“In order for consumers to invest in the property market, they will need to focus on paying down debt to improve their affordability levels - a challenging task with the cost of food and fuel continually rising.” He adds that while the prime interest rate is currently at 8.5%, it is predicted that it will likely start to increase from early in 2014. This will put further pressure on consumers who are already struggling to service their current outstanding loans.
Moneyweb

Residential building statistics
Absa - South Africa
Slowdown in residential building activity continues

The slowdown in residential building activity that commenced in May 2013 in the South African market for new housing continued up to August this year, after levels of activity have been on an upward trend in the first four months of the year. August saw negligible year-on-year growth with regard to the number of housing units for which building plans were approved by local government institutions, whereas the number of new housing units reported as completed dropped for the fourth consecutive month on a year-on-year basis in August.

On a cumulative basis, residential building activity still showed some growth in the first eight months of the year in terms of volumes as well as building area, with only the volume of housing units completed showing a small drop from the same period a year ago. The category for flats and townhouses remained the major contributor to growth in residential building activity up to August this year.

The number of new housing units for which building plans were approved increased by only 0,5% year-on-year (y/y) to a level of 4 613 units in August 2013, although there was an increase of 887 units in the planning phase from the July figure of 3 726 units. The higher number of plans approved in August compared with July was mainly driven by the segments of small houses and flats and townhouses.
Building stats Aug 2013

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