Limits on the number of agents allowed to market property in housing estates should be scrapped.
This recommendation forms part of the best practice guidelines drawn up by the Institute of Estate Agents (IEASA), the body representing the interests of South Africa’s estate agent industry, and the Association of Residential Communities (ARC), the body representing the residential
community industry.
The establishment of the guidelines follows months of talks between IEASA and ARC to resolve dissatisfaction with the widespread practice of homeowners’ associations (HOAs) in housing estates to “accredit” selected agents to exclusively market property in such estates.
It is proposed that the primary residence exclusion “be extended so that an alternative is available based on the gross sales proceeds of the residence.” People selling their primary residence with a gross value of less than R2-million would not be liable for CGT. For primary residence valued above this threshold, “the normal rules (including the current R1.5 million capital gain/loss exclusion) will apply”.
As the managing director of one of Durban’s major real estate companies, I am committed to the upliftment of the industry, both in terms of improving its professionalism and encouraging those previously precluded from it.
Accordingly, I have thrown my support behind the Estate Agency Affairs Board (EAAB), which as the statutory regulator, is about to introduce new and compulsory training to the industry.
Business in South Africa is indeed strange. Loyally estate agents and principal that send business to Standard Bank are now be told to get LOST. WOW I though a proper business model would greater with greater incentives would have drawn more business but hey I am still a rooky in business so what do I know.
There is much debate currently among property experts, with one camp predicting a continuing downward spiral for the foreseeable future, while the other maintains the current scenario is a bump on a road that will soon head skywards once again.
“Before we can make accurate predictions about the future,” explains property economist Erwin Rode of Rode & Associates, “we need to be clear on how we got to where we are today in the first place.”
Capitalization rates — the property equivalent of the forward earnings yield of shares — have remained put despite a deteriorating inflation and interest rate outlook. This is according to the latest Rode’s Report on the South African Property Market which reports on surveys conducted during the fourth quarter of 2007.
However, notes property economist Erwin Rode: “With local growth prospects that have become more shaky as a result of a more precarious international growth outlook and supply constraints, most notably electricity, capitalization rates could come under some pressure as investors reassess the risks.”
Berry Everitt, MD of the Chas Everitt International property group, says: “The Reserve Bank’s decision to raise the repo rate to 11,5 percent will have a dreadful effect on consumer confidence and a major negative effect on the property market.
“Homeowners are already battling to deal with higher loan repayments, higher fuel and food prices, higher municipal rates and the threat of higher electricity charges and for many, this might just be the last straw as it will push the nominal home loan interest rate to 15 percent.
In the wake of yesterday’s interest rate hike by 50 basis points, First National Bank has appealed to homeowners who are struggling to meet their bond obligations to come forward for help.
“These are tough times for the SA household. The evidence indicates that the pressure from the rising costs of living is being felt by all types of consumers,” says FNB Home Loans CEO Jan Kleynhans.
CAPE TOWN (April 11) - The repo rate increase of 50 base points will further trim the already shrinkage in the volume of residential property sales, but its impact would again be cushioned, just as the earlier increases had been absorbed to some degree, by sellers lowering their expectations on asking price.
More important to Jeanne van Jaarsveldt, marketing and finance director of RE/MAX of Southern Africa, was the effect the hike would have on residential rentals as he was in little doubt the rise would be flashed onto tenants.
2008-04-10: Statement of the Monetary Policy Committee
Issued by Mr T T Mboweni, Governor of the South African Reserve BankIntroduction
The South African economy continues to respond to the less accommodative monetary policy stance. Domestic expenditure is responding to our current policy settings. Various high frequency and survey data point to the economy growing at a rate below potential, but nevertheless underpinned to some extent by strong investment expenditure by the private sector and public corporations.
