Property owners up in arms over rates increases
Moneyweb - South Africa
Hikes of 43% to 500% seen over five years.
Are the increases in municipal rates charged to property owners in accordance with the law?
According to the South African Property Owners Association (Sapoa), which represents about 1 200 companies and organisations, the simultaneous increases in property valuations and the Rates Factor have resulted in municipal rates levied on commercial property owners skyrocketing.
Estienne de Klerk, president of Sapoa, says some of its members have experienced rates increases in excess of 500% in the past five years.
In one member’s case, the average growth in its property values was 43%, but the rates in the same period grew by 114%.
De Klerk explains the rates are set annually and are really a function of two components – the valuation of the property, which is revisited during a valuation process every four years, and the rate in the rand.
Home ownership is once again looking much more attractive than renting
Rawson - South Africa
In the last few months the arguments in favour of renting rather buying the residential property in which you live have grown a great deal weaker, says Bill Rawson, Chairman of the Rawson Property Group.
“In the first half of 2013 anyone following the trends in the South African property world would have become aware that there was a growing lobby very much in favour of renting rather than buying.”
“In the second quarter issue of the respected magazine “Personal Finance” for example, Irwin Rode, the property economist, produced a table that showed that on his calculations, an investor buying a R1 million home in which to live would, on a 100% bond, pay out R651,832 in five years. If after that period he then sold, he would make a profit of only R46,532.”
“If, on the other hand, the investor had rented a house of similar value, his rental outlay would have been only R349,969, which, in theory, would have left him with a R374,139 saving which could have been invested profitably elsewhere.”
Know where your property boundaries are
IolProperty - South Africa
With new housing development and the sale of stands in gated communities starting to pick up again, buyers must make sure they have accurate information regarding boundaries, beacons and stand numbers. So says Berry Everitt, MD of the Chas Everitt International property group, who notes that most property sale agreements contain a clause saying that the buyer has familiarised himself with the location and extent of the land he is buying - but that very few buyers do in fact really 'walk the boundaries' before they sign. 'And while that may not be a problem when the stand they are buying is in an established suburb and visibly defined by the boundary walls or fences around other properties, it could turn into a major headache in a new estate or township.'
Residential building statistics
Absa - South Africa
Residential building activity remains subdued
The first nine months of 2013 saw levels of residential building activity in the South African market for new housing remaining subdued, while activity levels in both the planning and construction phases contracted in the third quarter of the year compared with the corresponding period in 2012. The category for flats and townhouses remained the major contributor to growth in residential building activity up to September this year.
From 1994 up to September 2013, a total number of 1 115 272 private sector-financed new housing units were built county-wide, of which 817 660 units, or 73,3% of the total, were constructed in the segments for smaller-sized houses of below 80m² and higher-density flats and townhouses.
The number of new housing units for which building plans were approved dropped by 5,7% year-on-year (y/y), or 763 units, to a level of 12 611 units in the third quarter of the year, while declining by 1 161 units, or 8,4% quarter-on-quarter (q/q). These year-on-year and quarter-on-quarter declines in the number of plans approved occurred in the segments for houses larger than 80m² and flats and townhouses.
Absa Building Stats Sep 2013