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And SA after World Cup fever?
Businessiafrica.com - South Africa
Property Strategist John Loos says that, although the 2010 World Cup is welcome, the timing isn't in fact perfect and he is a little worried about white elephants post 2010…

Chris Gibbons:
Have we got the timing right for the World Cup in 2010? Has it in fact come at a time when the building and construction sector would have been expanding anyway? What happens after the final whistle has blown? These are important questions from FNB's Commercial and Property Strategist John Loos, who joins us now from Johannesburg.
First off, you are not saying that we shouldn't be hosting the event?

John Loos:
No, not at all. I think it is one of the greatest things that could ever happen and I think it is fantastic and I don't think you can really plan the timing. You have got to put in a bid sometime and it's got to be long in advance. There is nothing much one can do about it, but I think ideally, from a cyclical point of view, one would have liked to host it when the building industry was flat and had a lot of spare capacity and there wasn't demand for its services.

Time for speculators to cash in?
Moneyweb.co.za - South Africa
The buy-to-let property market is under pressure possibly prompting property speculators to sell and weaken prices, warns Herschel Jawitz, CEO of Jawitz Properties.

"Investors, especially the short-term speculators, are now earning a meagre 5% yield. The deficit between rentals received and mortgage repayments plus levies is widening. In addition, the rate at which house prices are increasing is slowing," he explains.

At the beginning of the property boom, many investors aggressively entered the market hoping to earn an income from letting out second and third properties.

Jawitz maintains that, over the past few years, investors were prepared to sacrifice low yields and cash flow for the expectation of strong capital gains.

"These gains are no longer a prospect in the short to medium term and investors need to reconsider whether to become long-term investors or exit the market," he advises.

Residential properties peak
Moneyweb.co.za - South Africa
Residential properties are fully priced but there are booming times ahead for the office and industrial market.

Speaking at the annual Rode property conference, Erwin Rode warned that residential property prices are at the peak of a long property cycle. He said meaningful growth in the next few years is unlikely. "In the short term, rising interest rates confirm this," he added.

He advised buy-to-let investors to think twice about staying in this asset class. "In contrast, office and industrial properties should experience strong growth."

Investors urged to take care in dealing with sectional title office and industrial schemes
Business Day - South Africa
With rising interest in sectional title office and industrial schemes, investors and owner-occupiers must realise that these developments can hold the same pitfalls as their residential counterparts.

Legal experts say investors must study the financial state of the body corporate if they are buying into an existing scheme or make sure the developer driving a new scheme is reputable.

If there is wide scale non-payment of levies in a sectional title scheme, a good unit owner who makes sure his levies are paid up to date may lose value in his investment.

Over the past two years there has been significant growth in demand for these types of investment because they afford investors and owner-occupiers a cheaper way of participating in the relatively expensive commercial property market.
Business Day

FNB invests R2bn in SA housing
Business.iafrica.com - South Africa
First National Bank on Tuesday increased its investment in housing to just under R2-billion this year, with the unveiling by government of Phase 2 of the N2 Gateway housing initiative in Cape Town.

FNB has partnered with government to deliver about 3000 bonded houses in Joe Slovo settlement, part of Cape Town's Langa township. Today marked the official hand-over of part of the N2 Gateway's Phase 1 rental housing stock to beneficiaries.

According to the bank, it is committed to investing about R600-million towards the project, which will benefit people earning between R3500 to R7500 per month.

House prices range from R150 000 to R250 000 per unit. FNB's involvement in the N2 Gateway housing initiative brings the bank's total investment in housing to R1.7-billion this year. This translates to 7049 housing units.

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