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27 March 2014

Unapproved building plans could block property sale
IolProperty - South Africa
Never build anything on your property without council-approved building plans, because although you may get away with it at the time, it'll cause considerable headaches when it comes time to sell. According to Lew Geffen, chairman of Lew Geffen Sotheby's International Realty, unauthorised structures can cause deal-breaking problems, and could even end up in lengthy legal action.

Geffen said agents were often approached to sell properties by owners who came unstuck when it was time to complete the legally binding property condition report that included a clause about whether there were approved building plans for all structures on the land.

'The biggest culprits are garages. Property owners often see them as just four simple walls and a roof and don't understand why they should go through the perplexing and potentially expensive bureaucratic process of submitting plans to the local council and waiting for what can be a substantial time - depending on backlogs - to get them passed.
IolProperty

Changes to the National Credit Act not as drastic as some think
Rawson - South Africa
“The removal of adverse consumer credit information and information on paid up court judgments, published in new regulations of the National Credit Act 2005 on 25 February 2014 has caused some alarm in the property sector,” says Mike van Alphen, National Manager of Rawson Finance, the Rawson Property Group’s bond origination division.

“Some commentators,” says van Alphen, “see this amendment as totally nullifying the role of South Africa’s credit bureaux, which have played such an important part in identifying those bond applicants with blemished credit records.”

The reason for this, said van Alphen, is that the regulations, at first glance, appear to ban all information about non or late payments of credit accounts — however this is not the case.

“It will still be possible for the banks and other lenders to have access to a client’s current debt situation, including a list of his current credit accounts. What is no longer permitted", said van Alphen, "is for a credit bureau or any other researcher to reveal if a client has had a debt judgment passed against him if the client had settled the capital of the debt.”
Rawson

Residential building statistics
Absa - South Africa
Planning phase with regard to residential building activity improves, while construction phase contracts in early 2014
The level of building activity in the South African market for new housing showed significant growth with regard to the planning phase in the first month of 2014 compared with a year ago, whereas the construction phase contracted in January from its level of activity in the same month last year.

The number of new housing units for which building plans were approved, increased markedly by 46,7% year-on-year (y/y) to 4 765 units in January 2014. This growth was largely driven by the segments of houses less than 80m² and flats and townhouses, recording strong growth of 74,3% y/y and 64,9% y/y respectively. These two segments of the market comprised 73,7% of the total number of plans approved regarding new housing in January. At a regional level the volume of plans approved in respect of new housing showed strong year-on-year growth in Gauteng, the Free State and Mpumalanga.
Building stats Jan 2014

Household - January SARB Leading Indicator
FNB - South Africa
The Reserve Bank’s Composite Leading Indicator continues to slow year-on-year, hinting at some possible near term moderation in mortgage lending growth and mild deterioration in household financial performance.
This year-on-year decline can have near term implications for new mortgage lending growth. For much of the time in recent years, the growth direction in value of new mortgage loans has broadly tracked the direction of growth in the Leading Indicator, as one could probably expect in a “rational” market driven by economic fundamentals. The further decline year-onyear in the Leading Indicator could thus imply near term slowing in growth in new mortgage loan payouts (Commercial and Residential, as per SARB data series).

As at December, 3-month average year-on-year growth in new mortgage payouts was still a very solid 15.3%, but this growth had already slowed mildly from a few months prior, co-inciding with the slowing growth in the Leading Indicator.
Household Sector January Leading Indicator

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