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28 January 2010

FNB SARB leading indicator
FNB - South Africa
CONCLUSION
The latest Leading Indicator datapoint to appear, that of November 2009, indicated a significant further acceleration, on a month-on-month basis the value going from 116.5 to 119.8, which translates into a year-on-year growth acceleration from 6% in October to 11.6% in November. This bodes well for further improvement in growth in new residential mortgage loans and re-advances granted in the current quarter.

While prospects for further interest rate cuts don't appear wonderful, it is likely that some of last year's rate cutting stimulus still has to be felt early in 2010, while the rise in the leading indicator is also driven by moderately strengthening economic growth signals. An improving economy has positive implications for disposable income growth and thus residential purchasing power in the near term..
FNB - SARB leading indicator

Trustees' rights: What owners can do
Property24.com - South Africa
In terms of section 39(1) of the Sectional Titles Act, 1986 ("the Act"), "The functions and powers of the body corporate shall, subject to the provisions of this Act, the rules and any restriction imposed or direction given at a general meeting of the owners of sections, be performed and exercised by the trustees of the body corporate holding office in terms of the rules."

Like any other "artificial person" the body corporate has no physical existence, so this provision authorises the trustees, whoever they may be from time to time, and acting as a group, to exercise the functions and powers specified in the Act. But this provision also allows the owners, acting as a group, to place restrictions on the trustees' discretion in exercising the body corporate's powers or performing its functions, or to give them specific directions as to how they should do so.
Property24.com

SARB interest rate decision
FNB - South Africa
For the residential property and mortgage market, given that they are leading sectors in the economic cycle, this could be a little sooner, closer to the middle of this year, after which we expect to see accelerating demand starting to plateau. Although anticipating residential and mortgage demand growth reaching a plateau later this year, that does not change our expectation that 2010 as a whole will be a significantly better year than 2009.

The unchanged prime rate probably implies a decline in real prime rate in the near term, according to the CPI-deflated measure as well as the house price deflated measure, given the expectation of some rise in both CPI inflation as well as house price inflation in the coming months. However, the still-positive real prime rate, according to the house price measure, continues to make short term property speculation by-and-large an unattractive pastime.
FNB - MPC indicator

Avoid property tax: Get another wife, earn timeshare
RealEstateWeb - South Africa
Not every tax hole has been plugged in South Africa.

This week in Realestateweb's Tax Bites: Great news - there are still ways to avoid paying capital gains tax on property deals.

Get more wives. Realestateweb's favourite Rhodes University tax professor has found another compelling reason for South Africa's President Jacob Zuma to keep several wives - potentially huge tax savings. In fact, if you're a property investor or speculator and you'd like to chop your capital gains tax bills when you sell, you should consider a life of polygamy too.
RealEstateWeb

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