Land restitution bill passed
The passing of the Restitution of Land Rights Amendment Bill by the National Council of Provinces (NCOP) has been welcomed by the Department of Rural Development and Land Reform.
The bill seeks to re-open the window for persons or communities who lost their land after 1913, due to past discriminatory laws and policies, to lodge claims for their properties. “The Bill will now be submitted to the President for signature. The re-opening of the lodgement of claims will take place once amendments to the Restitution of Land Rights Act 22 of 1994 have been signed into law by the President,” said the department on Friday.
Details of how to lodge claims will be published once the amendments to the Restitution laws have been finalised.
Buyers careful about council charges
Municipal rates and tariffs, and the efficient delivery of council services in return for such payments, are already featuring more prominently in home buyers’ decisions regarding where to live, and are set to become a critical issue.
This is according to Richard Gray, CEO of Harcourts Real Estate, who says buyers are now more concerned about what the monthly municipal bill is likely to be if they move to a certain area, and with good reason. He says different local authorities calculate their property rates and utility charges differently, and this can have quite an influence on the affordability of properties, in terms of the National Credit Act.
The reason is that the Act requires that all debt commitments and all regular and projected household expenditure be taken into account when a potential buyer applies for a home loan, so that he or she will not become over committed financially.
Listed property returns made easy
Listed property has been the star performer of the four traditional asset classes over the past 15 years, outperforming equities by 6.4 percent per annum.
Up to mid-May last year, listed property delivered sterling total returns of 21 percent for the year, says Dr Koos du Toit, chief executive officer of P3 Investment Group. But then investors were starkly reminded of how exposed listed property is to the vagaries of the stock markets, often driven by uncontrollable external events and irrational investor sentiment, as yields plummeted to just 5.3 percent for the year to date.
This was caused by external events entirely beyond investors' control, notably the announcement of the tapering of the US Fed’s quantitative easing programme and indications that interest rates could be rising, which proved accurate in January when the Reserve Bank announced a surprise interest rate hike, impacting listed property share prices.
Agent certification deadline looming
Some estate agents still seem inclined to ignore the fact that all estate agents now have to obtain the Further Education and Training Certificate in Real Estate (on Level 4 of the National Qualification Framework), which has to be done by 30 June 2015. Similarly, all real estate business owners must obtain the National Certificate in Real Estate (NQF5) by that date.
According to Barry Fourie, head of the Rawson Property Group’s Training Academy, time is running out for unqualified estate agents, some of whom still seem to think that a further extension may be given or that the new educational regulations set up by the Estate Agency Affairs Board will somehow be set aside.
He says agents who already have a valid Fidelity Fund Certificate duly issued by the Estate Agency Affairs Board as at 15July 2008, can obtain the new qualification through the Recognition of Prior Learning provision. New entrants are required to do a 12-month learnership with an accredited training provider while completing a log book of activities as intern estate agents. These log books must then be sent to the Estate Agency Affairs Board at the end of the 12-month intern period.
Property investments and tax deductions
The annual tax season for the period 1 March 2013 to 28 February 2014 has recently closed and once your IRP5 has been submitted, you wait for SARS’ decision as to whether you need to pay in or will receive a refund.
Either way, it is time to reflect on the coming financial year-end, 28 February 2015, and to start planning on how to best focus on your financial growth, says Craig Hutchison, CEO of Engel & Völkers Southern Africa. "Submitting your income to SARS could generate a positive cash flow, however, in order to benefit from tax deductions, the ideal situation would be to invest in property."
He says having a successful property portfolio will increase your net worth and is possibly the best investment you could consider.
How to deal with slow paying tenants
Owning a rental property is seen as an investment, but enter into discussion with a landlord and soon you’ll discover that it can also be a frustrating experience.
In many cases, the rent paid by tenants assists in reducing the landlord’s mortgage on that property. If a tenant is not paying the rent on time, it might lead to the landlord defaulting on his own bond repayment. This could result in the relationship between tenant, estate agent and landlord turning sour, as the one holds the other accountable for payments not received.
As landlords have discovered in recent years, slow payments have become increasingly common. When it occurs, it is important that you do not take the law into your own hands by changing locks or disconnecting the tenant’s water or electricity. South African law protecting tenants against eviction is complicated and requires expert advice.
Carefully vet prepaid system vendors
When it comes to the installation of prepaid electricity meters in sectional title schemes, in most cases the body corporate will benefit by having these installed, but sometimes the trustees might not investigate fully what the vendor’s conditions and costs are going to be.
This is according to Michael Bauer, general manager of the property management company IHFM, who says there are often costs that have not been factored in and the system is not as straightforward as it is thought to be. All the costs need to be worked out beforehand, not just what the body corporate will be paying but what the consumer will be paying for each month, says Bauer.
Vendors have different business models, and it is vital that on choosing who the service provider will be, all the costs are calculated before agreeing to sign a contract for their services, he says.