Cancelling a sale can be risky business
South Africa - Gibbs & Dold
“Payment of tax is what the law prescribes, and tax laws are not always regarded as ‘fair’. The tax statute must be applied even if in certain circumstances a taxpayer may feel aggrieved at the outcome.” These were the words of the Supreme Court of Appeal (SCA) in the recent judgment New Adventure Shelf 122 (Pty) Ltd v Commissioner of SARS. This case examined the consequences of Capital Gains Tax (CGT) where the sale of a property was cancelled before the seller had been paid in full.
In the 2007 year of assessment a property was sold and a substantial capital gain was taken into account in the seller’s tax assessment for that year. Unfortunately, the purchaser defaulted, only paying a portion of the purchase price, resulting in an agreement to cancel the sale several years later. The property was returned to the seller, who also retained the payments made to it as pre-determined damages for breach of contract.
Cancelling a sale
Residential building statistics
South Africa - Absa
Continued contraction in levels of residential building activity
Residential building activity with regard to new private sector-financed housing in South Africa (see explanatory notes) continued to contract in the first two months of 2017 compared with the corresponding period in 2016. This is according to data published by Statistics South Africa. Contractions in building activity were evident in all segments of new housing as well as in respect of additions and alterations to exiting houses in both the planning and construction phases up to February this year. However, it was only the segment for flats and townhouses that recorded an improvement in building activity, which was with regard to the number and building area of plans approved.
The number of new housing units for which building plans were approved contracted by around 10% year-on-year (y/y), or 886 plans, to a total of 7 927 plans in the first two months of the year. This decline in building plans approved was driven by the two segments of houses, which recorded a contraction of 21,6% y/y, or 1 189 plans, to a combined total of 4 309 plans compared with 5 498 plans approved in the same period last year. However, the number of plans approved for new flats and townhouses increased by 9,1% y/y, or 303, to a total of 3 618 plans in January and February.
The construction phase of new housing, measured by the number of units built, contracted by 16,7% y/y, or 1 102 units, to a total of 5 487 units up to February this year. The decline in new housing built occurred across all three market segments.
Building stats Feb 2017
Cape Town city centre experiences population explosion
South Africa - IolProperty
The face of central Cape Town is changing rapidly as new investment in residential development increases the number of people who call the CBD home.
This week, the Central City Improvement District's (CCID) latest State of Cape Town Central City Report showed a record 228 residential properties were sold and transferred in the central city last year. This is the highest in the past five years.
The report notes that despite the numbers of properties sold, a year-on-year comparison confirmed the central city continues to show a steady rise in both price and interest in a downtown lifestyle.
In one decade, the residential population has exploded by just under 1 000% from 750 to to 7 000 residents. And this figure is set to grow with other residential developments planned, such as the Keerom Street development, Tuynhuys, by Robert Silke and Partners and Willbridge Property Company, announced this week.
The importance of a good relationship between landlord and tenant
South Africa - Rawson
In the past a tenant would only contact his landlord when reporting a problem, while the landlord’s main contact with the tenant occurred if the rent had not been paid or there was an upcoming increase in costs. “It is of paramount importance that a healthy and amicable relationship between a landlord and tenant be nurtured in order to encourage easy communication between them at all times,” says Leon Breytenbach, National Manager of the Rawson Property Group’s commercial division. When communicating with tenants it is essential that the landlord be courteous, respectful and professional at all times. This will reduce the likelihood of frustration or animosity arising when negotiations for a lease renewal are due or the parties need to discuss a problem or a need.