SA's hot 2009 to 2011 property trends
South Africa’s stingy banks and high cost of property maintenance has led to many homeowners downscaling and some people opting to share instead.
According to Bill Rawson, chairman of Rawson Properties, 2009 to 2011 will go down in property history as a time in which certain trends gained momentum at a pace not seen before.
Of the most noticeable trends, downscaling has been more frequent with many homeowners looking for less expensive, smaller units with a concomitant fall-off in the value of the more expensive homes, he says.
This resulted in some lower and sectional title units being developed with less than 40 square metres of floor area and in new lower middle bracket homes now coming onto the market with as little as 60 square metres of floor space. Rawson says these units can sell for anything from R450 000 to R1.2 million and the demand for this accommodation can only increase.
Budget for costs not in property price
The thought of owning one’s very own home is a thrilling prospect for many, but it is important to keep in mind that besides the selling price there are many additional costs involved.
All buyers, especially first-time buyers, need to be aware of the various costs that are associated with a purchase before even considering the idea of becoming a homeowner.
According to Richard Gray, CEO of Harcourts Real Estate, before purchasing property a potential buyer needs to seriously consider the impact that the purchase will have on their finances.
He says this is particularly relevant in circumstances where the buyer is wanting to start a family, is in the midst of paying off debt, starting their own business or a new job. He advises them to rather wait until their financial future is more secure and stable before becoming a homeowner.
Don't wait too long to buy property
Growth in Standard Bank’s (smoothed) median house price experienced further easing, contracting by -1% y/y in November from -0.5% y/y in October.
Standard Bank Home Loans research analyst Sibusiso Gumbi says house price growth has remained rooted in low single digits throughout 2011 and this is likely to continue in 2012.
The bank says household credit remains in low digits and so too does house price growth.
Writing in the latest house price report, Standard Bank Home Loans research analyst Sibusiso Gumbi says house price growth has remained rooted in low single digits throughout 2011 and this is likely to continue in 2012.
“South Africa’s macroeconomic fundamentals indicate a lack of stimuli for the residential property market to return to double-digit year on year price growth.”
Are sustainable buildings worth more?
The increasing adoption of sustainable practices has provided commercial returns with reduced operating costs, such as energy consumption.
According to Roger Hunting, director of Broll Valuation & Advisory Services, sustainable practises allow for greater marketability of the property concerned, particularly with regard to the public sector or in markets where there is over-supply.
Broll is part of CB Richard Ellis Affiliate Network. Hunting explains that these are findings from CBRE, which has launched its Sustainability Checklist.
The checklist is aimed at establishing an evidentiary base whereby property valuers will be able to directly correlate the impact of sustainable building attributes and innovations to the value of an asset.
"Sustainability and its promotion is an important, natural evolution of the real estate industry.”
Can new landlord cancel my lease?
A Property24 reader asks:
I was wondering if you could assist or point my query in the right direction.
I have signed a one-year lease agreement and have just been advised that the property was auctioned off and bought. The new owners have advised us that they don’t have to honour the lease agreement
Alan Levy, an attorney at Alan Levy Attorneys who specialises in evictions, rent recoupment and landlord/tenant law replies:
The scenario seems to be that you signed a 1-year lease agreement with the owner of the property. Thereafter the property was auctioned off and bought by a purchaser. The purchaser has advised you that the lease agreement does not have to be honoured.