Property 24/10 - 104 - LexisDigest

Auction ‘ghost bidding’ not norm: SAIA
The SA Institute of Auctioneers (Saia) on Wednesday denied a claim by former Auction Alliance chief Rael Levitt that "ghost bidding" is a common practice in the industry.

"Saia emphatically and categorically distances itself from Mr Levitt's assertion that ghost bidding is not unique to him, and is the norm within the South African auction industry and across the world," Saia chairman Tirhani Mabunda said on Wednesday.

"Saia also disputes Mr Levitt's statement that he has taken the brunt for the entire... industry."

A ghost bidder attends an auction with the intention of driving up prices.

Mabunda challenged Levitt to name any other auctioneer or auction company practising ghost bidding.

Mabunda was briefing reporters in Johannesburg in response to Levitt's comment in the Sunday Times newspaper on April 15, and because the allegations against him and Auction Alliance were "festering in the media".

Levitt told the Sunday Times in an e-mail he did not deserve to be demonised by South Africa.
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Avoid wrangles over occupational rent
When you've sold your home, the last thing you want is a disagreement with the buyer about the occupation date or occupational rental.

“Unless they put their new arrangement in writing, the buyer might well resist paying any occupational rental other than that originally stated in the sale agreement - on the grounds that he had simply done the seller a favour by moving in earlier,” he warns.

However, such disputes do arise, usuallybecause the buyer and seller have privately changed the arrangements set down in the occupation clause of their sale agreement and neglected to commit these changes to writing.

This is according to Berry Everitt, MD of the Chas Everitt International property group who says occupation dates are usually set at the month-end or month-start closest to the estimated date on which the transfer of the property will be registered.
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What affects a property's value?
Research suggests that most buyers take only a few minutes to decide whether or not they like a property.

Factors that are sometimes beyond the homeowner’s control can influence the buyer’s opinion and the marketability of the home before the buyer has even stepped past the front door, says Adrian Goslett, CEO of RE/MAX of Southern Africa.

He says that the reason that most industry experts give for a home not being seen in a favourable light by buyers would be the property’s location. A property’s proximity to good schools, supermarkets or malls, recreation areas such as parks and other amenities all weigh heavily on how the property is valued in the buyer’s eyes.
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More people buying property in SA
South African mortgage originator ooba reports a significant growth in bond applications and approved home loans in March.

The company’s latest data reveal that home loan approvals showed year-on-year growth of 49 percent for March and ooba says this is the best performance since April 2008 and only 34 percent of the value of the approvals ooba recorded in May 2007.

Chief executive officer of ooba, Saul Geffen says this is thanks to increased buyer activity and easier access to finance.

Geffen explains that South Africa's economy grew at a rate of 3.2 percent in the fourth quarter of 2011 and an improvement in the job market, which will also impact the residential property market.

"Consumers understand that in today’s tough lending environment, using a mortgage originator to apply to multiple lenders significantly enhances the chances of securing a home loan approval.”
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Full title homes best investment?
Full title properties offer some distinctive advantages over sectional title when it comes to investing in residential property.

Neil Fuller, Broker/Owner of RE/MAX One who operates in the Johannesburg suburbs of Edenvale and Bedfordview, says that the best investment bet in his areas are full title residential homes.

According to Fuller, full title residential homes generally offer by far the best rental income. His advice is for investors to stay in the price bracket below R1 million. The critical factor is to buy right, he says.

Fuller believes that sectional title properties do not have any investment potential as buyers often have little control over their investment and one cannot easily change the buildings to increase the rental income. Levies too are out of the buyer’s control.
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Estate agent training courses 2012
In marketing residential property today, agents may find themselves on an easier wicket as a result of decreased competition.

This is according to Dianne Brock, general manager of the Western Cape Institute of Estate Agents, who says large numbers of agents have left the profession and the total number of those employed is down by about two-thirds.

She says those still in business can now increase their share of the market - and many have done just that.

The need for higher qualifications is driven by the fact that in today’s market, agents require skills which in easier times were possibly not so essential, she notes.

For this reason, the Western Cape Institute plans to provide more training programmes in 2012 than ever before.

On offer will be a five-day intensive ‘Back to basics’ or ‘Kick start to your career’ course given by experienced real estate trainer Gerhard Van Rensburg.

This is geared to both rookies and experienced agents. Rookies will find it a useful introductory course to property and those as yet undecided will find it helps them to make a decision.
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Need-to-know before renovating ST unit
Sectional title owners have to abide by conduct rules if they wish to do alterations or renovations to their units.

Often, says Michael Bauer, general manager of the property management company, IHFM, problems arise when an owner (often a new owner) of a sectional title unit plans to renovate his newly acquired property.

Bauer says this is not permitted without the prior consent of the trustees of the body corporate and the local municipality, especially if the improvement involves structural changes, an extension or an alteration to the external look of the building, or any major building work.

If electrical work is involved a qualified electrician’s compliance certificate has to be obtained – and the same is necessary if plumbing work is called for: a plumber’s compliance certificate has to be issued on completion of the work.

“These requirements are often overlooked, especially by those doing kitchen and bathroom renovations,” he says.

Any renovation taken without the trustees’ approval, says Bauer, is likely to be a breach of the scheme’s conduct rules.
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Property 24/10 - 104

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