How well do home values really hold up in tough economic times?
FNB - South Africa
There exists a view that property values are capable of by-and-large “holding up” in tougher economic times, some even believing that home values “can only rise”. Such views were even arguably behind the massive mortgage lending boom across much of the world last decade.
These claims, or assumptions, around property values are often a little far fetched, and we believe that they stem, in part, from a misinterpretation of the most commonly used measures of home prices, namely house price indices. Home values fluctuate just like any other asset class would in response to changes in economic conditions, but a house price index is something different, not measuring all existing home values but, rather, transaction prices…..and there is a big difference.
How well do home values really hold up in tough times?
The importance of rental deposits for landlords and tenants
Rawson - South Africa
Landlords often ask for one and a half, two or more month’s rental to be paid as a deposit upfront before tenants take occupation. These deposits safeguard landlords against breaches in the lease agreement, damage to property, rent shortfalls and the non-payment of utilities.
In the initial negotiation phases it is absolutely essential that the tenant and landlord (or his agent) inspect the property together, says Johann van der Merwe of Rawson's Somerset West franchise, and draw up a comprehensive lease agreement which includes a complete inventory of every item in the property and a written and photographic record of the condition of all aspects of the property.
Shock judgment for Joburg improvement districts
IolProperty - South Africa
In a shock judgment that sent waves of panic through many of Joburg's central business districts and communities, the Supreme Court of Appeal has deemed all of Gauteng's 19 city improvement districts (CIDs) illegal, and has nullified all levies raised by these council-approved CIDs.
This could result in property values declining, the slowing of social and economic development, an increase in crime, the decline in the maintenance and cleanliness of public spaces, and about 4 000 job losses.
It could also affect many informal traders who are regulated by the CIDs. Many wellrun suburbs and CBDs across the city could face decline.
CIDs are areas in which the majority of property owners agree to fund supplementary and complementary services to those provided by municipalities to maintain and manage the public environment.
See Randburg management districtIolProperty
Property Barometer – Area value bands
FNB - South Africa
In the 6 major metro regions, the Upper Income Areas continued to show the most noticeable slowing in house price growth, admittedly off the highest base.
Our September FNB National House Price Index showed some renewed year-on-year growth acceleration, following a prior slowing trend, suggesting that the days of a well-balanced residential market are not quite over yet.
It is important to bear in mind that our National House Price Index is compiled from our own FNB data, which is more up to date than Deeds Data, while out FNB Area Value Band House Price Indices utilize the more “dated” Deeds data. So as at the 3rd quarter of 2015, the Area Value Band Indices had not seen any slight renewed rise in growth yet.
The Area Value Band Indices are nevertheless insightful in providing an idea of the relative performances across areas grouped by the average price levels of areas in the 6 major metros of South Africa (Tshwane, Joburg, Ekurhuleni, Ethekwini, Nelason Mandela Bay and Cape Town)
Artificial intelligence to radically transform the role of lawyers
Managing Partner - UK
"We are facing greater disruption and transformation in the next two decades than we have had in the past century," says Richard Susskind Advances in artificial intelligence (AI) will result in a steady decline in market demand for human professionals in the long term according to Richard Susskind OBE and Daniel Susskind, who held a panel discussion at UCL in London last night on the impact of AI and the internet on the professions.
"One of the least likely futures is that nothing is going to change," warned Richard Susskind, a leading management consultant and lecturer. "We are privileged to live in a time of more rapid and fundamental technological change than society has ever experienced."