Are SA Property Sellers and Buyers Out of Sync?
Alexo Property Brokers - South Africa
The real culprits behind soaring house prices and weakening home buyer sentiment may well be a number of real estate agencies and industry representatives whose support of unrealistic pricing and assertive promotion of house price inflation is damaging seller confidence.
“In a market where buyers are highly informed and increasingly hands-on in the purchasing process, it is also vital that sellers are equally engaged, advised and enlightened,” according to Matthew Alberts, Sales Manager of Alexo Property Brokers, a Cape Town-based real estate agency, who says on a weekly basis, and particularly more recently, the average South African home buyer is bombarded by conflicting sentiment on the state of the property market.
“On the one hand economists warn us that we’re likely to experience our most difficult year since 2008, with elevated inflation and currency weakness coupled with a strong likelihood of further interest rate hikes. Low GDP growth outlook, weakened consumer confidence‚ rising rates and elevated costs are set to weigh heavily on the spending and investment intentions of households and corporates,” says Alberts.
“On the other hand, however, a number of property industry players continue to ‘talk up the market’, encouraging sellers to list their homes at higher values and persuading buyers to accept these inflated house prices as accurate reflections of the current state of a resilient property market.”
How to get all residents to agree to sectional-title security technology
IolProperty - South Africa
Most residents of sectional-title schemes are likely to agree on the need for good security, but problems can arise when they try to reach consensus on the type of security systems needed.
Cost is, of course, a major consideration, since security provisions are typically the second-highest cost items in sectional- title scheme budgets after municipal charges. Some residents will always be opposed to installing anything but the most basic security system, whereas others believe the price of more sophisticated installation would be money well spent, says Andrew Schaefer, managing director of national property management company Trafalgar.
"Either way, this is one decision the trustees cannot make on their own, because having new security equipment installed or existing equipment upgraded would quite clearly constitute an improvement to the common property. And while trustees may authorise repairs to common property in terms of the Sectional Titles Act, they may not give the goahead for any improvements without consulting the owners in the scheme."
Cape Town property values continue to grow
Cape Town CCID - South Africa
The value of residential property in the central city continues to grow, with demand outstripping supply. The average price per dwelling last year was R2.013 million - a more than R500 000 increase compared with 2014. "It is understandable, therefore, that the increase in property prices over the past few years has led to speculation around affordability," said the State of Cape Town Central City Report.
From only about 750 people living in the central city's 1.6km2 footprint 10 years ago, it's estimated that there are now about 7 000 people living in the city. Last year, 185 units were sold in the central city, with a total value of R376m. This is slightly less than the 191 units sold in the previous year, with a value of R296m.
State of Cape Town Central City Report 2015
House Price Indices
Absa - South Africa
Stable middle-segment house price growth in the first quarter of 2016
The first three months of 2016 saw growth in the average value of middle-segment homes in the South African residential property market remaining relatively stable at a nominal 5,7% year-on-year (y/y). First-quarter price growth was to some extent influenced by noticeable base effects in one of the housing categories analysed. Due to continued relatively low nominal price growth and rising headline consumer price inflation to a level of 7% y/y in February, house prices deflated by almost 1% y/y in real terms in the first two months of the year. The average level of house prices was in February 2016 around 10,5% lower in real terms compared with the peak in August 2007. These trends in home values are according to the Absa house price indices, which are based on applications for mortgage finance received and approved by the bank in respect of middle-segment small, medium-sized and large homes (see explanatory notes).
Year-on-year nominal price growth in the categories of medium-sized and large homes slowed down further in March. However, in the segment of small housing, price growth accelerated further to above 10% in March. The rising price growth in this category of housing since late last year can to a large extent be ascribed to the base effect of sharply declining price growth in the corresponding period a year ago. Some marginal real price inflation was evident in the small and large categories of middle-segment housing in February this year, with continued price deflation recorded in the medium-sized category.
The average nominal value of homes in each of the middle-segment categories was as follows in March 2016:
- Small homes (80m²-140m²): R937 000
- Medium-sized homes (141m²-220 m²): R1 255 000
- Large homes (221m²-400m²): R1 987 000
The State’s herculean plans for the title deed conundrum
Moneyweb - South Africa
Many people still don’t have title deeds for the homes they live in.
Since the democratic dispensation in 1994, the South African government has built and delivered three million RDP houses. These housing opportunities are typically small and low-cost – and are subsidised by the government or free to poor citizens.
Yet fewer than one million people in the RDP housing market do not have registered title deeds for the homes they live in. A title deed is a legal document that reflects the ownership of a property.
Although estimates on the title deed backlog date back to 2011, the exact number of individuals without title deeds to the properties is difficult to calculate. The Department of Human Settlements has set a grandiose target of fast-tracking the release of more than 800 000 title deeds in the next three years.