The ins and outs of buying a real estate franchise
The real estate industry is rife with opportunity, and running your own property business can be an extremely attractive idea – but it’s not something you can jump into without a bit of preparation.
“Most prospective franchisees spend a lot of time weighing up the pros and cons of buying a franchise versus building their own brand - there is something very enticing about having your own name over the door, after all,” says Hart. “In most cases, however, the benefits of joining an established, national brand far outweigh the potential of an independent agency.”
He says these benefits include instant brand recognition, access to a broad (and often very profitable) referral network, experienced and ongoing business and marketing support, proven technology and in-house training, and a community of like-minded peers. Finding, training and retaining good agents is also far easier with the backing of a respected franchise brand, while those with a long-term outlook will appreciate the enhanced saleability of a branded agency down the line.
Another issue with the new Sectional Titles Management Act
One of the requirements of the new Sectional Titles Management Act is that the Community Scheme Ombud Service (CSOS) has to pre-approve new rules. Previously developers could simply register amended rules at the time of the opening of the sectional title, which would assist with the practical management of the scheme.
Mike Spencer from Platinum Global says typical examples would be late payment of levy fines and limits on occupation, confirmation that this was a pet-free scheme, and more.
“Now a developer has to apply for an approval certificate from CSOS before the Deeds Office can note the rules. I have no idea how long it is going to take CSOS to give a certificate, but am fairly certain that it is not going to be within seven days - more likely seven months,” says Spencer.
Tenant mix: 'sweet spot' between convenience and experience
There are many factors that contribute to the success – or otherwise – of a shopping centre, and getting the right tenant mix is up there at the top of the list.
The general manager of Menlyn Park Shopping Centre, the largest mall of its kind in Africa following its two-year R2 billion redevelopment, weighs in on what this really means. “First impressions count,” says Olive Ndebele. “We want our customers to be blown away by what we’re offering. We want them to find not only everything they need under one roof but also to be absolutely thrilled by the many, many additional ‘nice-to-have’ and unique offerings they’ll find at Menlyn Park Shopping Centre.”
To achieve this objective, says Ndebele, you have to know the mall catchment area and exactly who your mall will be servicing, and that’s generally the community in which it is located – although the very popular Menlyn Park Shopping Centre is also a “magnet” to residents of the outlying suburbs of Pretoria, the large contingent of foreign businesspeople and diplomats who live in South Africa’s executive capital city, and keen shoppers from the African diaspora including Sadec and Sub-Saharan Africa.
Any change to your home loan could trigger higher rates
Many investors and small business owners are being caught unawares when trying to access additional capital through their home loans. Not only is the age of the access bond over, but they may trigger changes which result in new, unattractive rates from their bank.
Many South African entrepreneurs used to rely on their access bonds to fund new ventures, new investment properties and, sometimes, as short-term operational capital when cash flow was tight.
Post 2008, central banks reigned in lenders and we saw both the National Credit Act and Basel III put a serious crimp on banks’ ability to offer these open-ended loans.
Basel III requires banks to meet two key ratios: the liquidity coverage ratio and the net stable funding ratio.
Co-working a growing trend for office space in 2017
There’s no doubt 2017 will be a shape-shifting year when it comes to the ways in which we work. It’s the year Generation Z enters the workforce, and more and more Millennials become managers while the Baby Boomers retire.
“It’s also a time when major corporates have to become more flexible in terms of where and when their employees work, freelancers, entrepreneurs, start-ups, remote workers, contract staff and ‘blended workforces’ form a larger part of the workforce,” says says Mari Schourie, CEO of The Workspace, part of the InteSpace group of companies, which operates co-work and serviced office spaces in South Africa.
As technology increasingly enables different ways of working, Schouri says the pressure is on to provide workspaces that are simple and flexible and technology-enabled.
Best and worst home improvements to make in 2017
Most homeowners will make improvements or do renovations over time, but if you are hoping to get back everything you’ve spent on those projects when you sell your property, you should focus on keeping what you already have in really great condition rather than making more radical changes.
“As agents we see this all the time - less expensive projects like repainting your home, or waterproofing the roof, or sanding and resealing your wooden floors usually generate much better returns on expenditure than big additions and alterations,” says Gerhard Kotzé, MD of the RealNet estate agency group.
And this is underlined, he says, by the results of the latest research by Remodeling Magazine, which has published an annual Cost versus Value report for the past 30 years to help owners decide which professionally-done home improvements are most likely to pay off.