Commercial vacancies not end of world
Rising vacancies at commercial properties don't necessarily mean declining prices as long as properties are well positioned.
Auction Alliance CEO, Rael Levitt, says retail properties with blue chip tenants are attracting extremely high prices and even if some line shops are vacant, investors tend to focus on the strength of the anchor tenants.
"What we have not seen at all in South Africa is distressed portfolios of shopping centres hitting the market. There have been a couple of well-let shopping centres which have come under the auctioneer's gavel, but these are because of collapsing holding companies, not because the underlying property investment is bad."
He says while trading conditions are tough, portfolios with bad covenants are going to be weak for a long time, but for those with good property fundamentals, we are seeing the highest prices being paid in years.
"Recent sales are showing that well-let and well-positioned commercial property is attracting a surge in buyer demand while vacant property in marginal areas is attracting no demand at all."
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Property sellers drop asking prices
Most property sellers have to drop their asking prices to achieve a sale, a property group said on Tuesday.
"And the average drop is around 12 percent, which means that most sellers are quite seriously out of step with what buyers are actually willing or able to pay," the Chas Everitt International property group said in a statement.
Berry Everitt, CEO said such sellers usually argued that prospective buyers were quite at liberty to make lower offers.
"The fact is that serious buyers will usually not make any offer at all on a home they consider to be overpriced, especially if there are many properties on the market for them to choose from."
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Middle-aged homeowners should downsize
Middle-aged home owners should downsize in preparation for a better retirement, a property group advised on Tuesday.
"In fact we suggest that people make the move as soon as they become empty-nesters," property group Harcourts Africa said in a statement.
The prospect of a carefree retirement at the traditional age of 60 to 65 was becoming an increasingly remote possibility for many people.
However, CEO Martin Schultheiss said proper planning could bring it closer, and one of the most important elements of that planning should be to pay off debts - including home loans - as early as possible.
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Low-cost sect. title has tough problems
There are certain challenges common to all sectional title owners, irrespective of their social or financial status.
Management, maintenance, co-operative environment, levies and rules all require some level of understanding, acknowledgement and commitment to make a scheme functional and efficient.
Affordability
It is affordability that determines a poor person's ability to maintain security of tenure in a sectional title scheme. A poor tenant who can barely afford low rentals will struggle to pay the monthly levy. The scheme is destined to collapse when affordability is conflated with a general misperception that a levy is rental disguised in another form and should not be paid by an owner.
There is therefore a need for basic education to change the mindset.
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Average deposit for home now R165k
Banks may well have started opening their mortgage lending taps again but the average homebuyer still needs to fork out a cash deposit of close to 20% of the property's purchase price.
Latest data from mortgage originator ooba show that in July the average deposit required by the major banks was 19,4%, translating into a relatively hefty cash pile of R165 260 if ooba's current average house price of R850 763 is used as a benchmark.
Although banks' deposit requirements have declined over the past 12 months, from an average 23,6% to the current 19,4%, these levels are still nowhere near the 0% to 5% deposits typically required by banks during the boom years from 2004 to 2008.
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Property market recovery to continue
The recovery in South Africa's property market, which began in the second half of 2009, has continued to take hold, according to bond originators ooba.
According to ooba CEO Saul Geffen, the monthly trends in the statistics tracked by ooba, which include movements in house prices, approved bond sizes, deposit requirements and bank decline ratios, all suggest that the positive conditions for homebuyers will continue into the second half of 2010.
The oobarometer price index recorded a 9.8% year-on-year increase in the average house purchase price in July to 850,763 rand from 775,172 rand, while the average purchase price made by first-time buyers also showed a year-on-year increase of 8.5% to 591,643 rand.
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Make the move without the stress
Buying a new home is fraught with a myriad of details - and buyers don't need added complications when the day comes to move lock, stock and barrel.
A few precautions can, however, prevent a lot of unnecessary stress, advises Martin Schultheiss, CEO of the Harcourts Africa property group.
In the first place, buyers should ensure that their sales agreements clearly state when they may take occupation of the property. This date is usually the first day of the month after transfer of ownership is registered in the buyer's name, but may be negotiated between buyer and seller. It is, however, advisable that the agreement specifies a date, rather than a vague description such as "upon registration of transfer".
If the agreed date allows the seller to keep occupying the property for a period after transfer, the agreement should clearly stipulate the amount of occupational rent payable. It is also helpful to stipulate that occupational rent must be credited to you as soon as the suspensive conditions of your agreement have been fulfilled as it will reduce the amount of ready cash you need to cover transfer and moving costs.
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R74m funding for industrial facility
Nedbank Corporate Property Finance: Cape has funded the development and completion of a R76m industrial facility in Blackheath, on behalf of Macadams International.
The 17,500sqm purpose-built facility will be used to home the group manufacturing companies, Macadams Baking Systems and RA Plastics.
The development has been designed with green principles in mind: ten 5,000 litre tanks to collect rainwater from the roof have been incorporated into the design, and these are used to supply the toilets, urinals and irrigation systems. Hot water is supplied by three solar powered geysers and a number of indigenous trees and shrubs have been planted to encourage birdlife back into the area.
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