Property World

PROPERTY MAKES HUGE CONTRIBUTION TO THE FISCUS

The property sector injects billions into the country’s economy.

THE PROPERTY sector is an often overlooked economic contributor but estimates show it plays a huge role in the economy, even more than those in the know give it credit for, says Tony Clarke, managing director of the Rawson Property Group.

“The latest estimates that I’ve seen show the South African property sector contributing as much as R191 billion to our GDP, with a R46bn direct contribution to the fiscus.

“That’s a far more significant contribution than the sector typically gets credit for and we have reason to believe it could be increasing even further in 2021.”

The property sales momentum created by last year’s buying conditions shows no sign of slowing down, and should the various economic stimuli announced in the president’s State of the Nation Address be implemented successfully, Clarke believes this activity – and the valuable liquidity it adds to the economy – could continue “well into 2021, at the very least”.

“One of the most pivotal factors will be the recovery of business and consumer confidence. This impacts on real estate directly, by increasing people’s willingness to invest in long-term assets like property, and indirectly, by improving job security and income growth and therefore affordability,” he says.

ACCEPTANCE OF YOUR OFFER JUST FIRST STEP ON JOURNEY

FOR NEW buyers who have had an offer to purchase accepted, there are still a number of steps that need to be taken before they can settle into their new home. Gerhard Kotzé, managing of the RealNet estate agency group, says these include:

Getting your finances in order:

Your bond may cover the whole purchase price of the property but you are also going to need cash to pay the bond registration fee, legal fees, transfer fees and any transfer duty that may be due. You will also have to pay half of the expected municipal rates and taxes for the transfer period, which is usually about three months, although you may get some or all of this amount back when the property is transferred. After that, you will need to pay for municipal services, such as water and electricity, to be connected in your name.

Obtaining additional insurance:

Your lender will certainly insist that you obtain homeowners’ insurance to cover the repair or replacement of the property in the event that it is damaged or destroyed by fire, wind, flood or other natural disaster. Many banks will also insist that you take out credit life insurance (bond cover) to the value of the outstanding home loan balance.

Responding to requests:

You need to respond promptly to requests from your bank’s attorneys or the attorneys attending to the property transfer to sign all the documents that are required to register a new bond and get the property registered in your name. Long delays or failure to respond can result in the sale being cancelled and you having to forfeit any deposit paid.

There will be a number of financial outlays before buyers can take ownership of their new home.

TIPS TO KEEP YOUR EMPTY PROPERTY SECURE

MANY residential properties belonging to foreigners as holiday homes are unoccupied and landlords struggle to find tenants.

Owners of such homes –even if they are only empty for a short period – need to ensure their properties are secure for both their own sake and insurance purposes, says Charnel Hattingh, head of marketing and communications at Fidelity ADT.

A great place to start, she says, is by getting to know the neighbours because they will be the first people to notice if anything is wrong.

“Speak to them and make sure that they have your contact details. Also make contact with the body corporate if your property happens to be in a block of flats.”

The next step is to check there are no holes in the fence or other easy ways for would-be criminals to gain access.

“Lock all outside gates, doors and windows and consider installing an electric fence or a beam alarm that is linked to an armed response company. Draw the curtains, and also consider installing a light system that is linked to a timer which can help create the impression that someone is home,” Hattingh says.

Step three, she adds, is to cancel deliveries and take care of the garden as it is very easy for a property to look unoccupied if newspapers and post start piling up outside the front door or if the lawn starts looking neglected.

Homeowners should also inform their armed response companies about properties that are going to be empty for extended periods.

Uncollected newspapers can be a sign that a property is vacant.

Going green does not have to cost the earth

WITH ESKOM hiking electricity tariffs by 15.63% next month, commercial property owners will need to make changes to how they use electricity.

Rising electricity costs ultimately have an adverse effect on tenant retention, rents and property values in the long run. This is bad news, considering the toll that Covid-19 has already taken on tenants and landlords, says Gregg Huntingford, chief executive of Spire Property Solutions.

But with some good proactive measures there is a silver lining.

“Building owners and landlords need to embrace the green change sweeping the world, as both a pro-active and defensive strategy, and should implement measures within their properties to reduce their electricity consumption.”

Huntingford says going green ’does not have to be a scary undertaking. People believe this involves massive changes and commitments with costs outweighing the savings but this is “simply not true” .

“Start with small changes, such as switching to energy-saving LED lighting and installing sensors so that lights go off in parts of buildings that are unoccupied. Also, metering everything to understand the power it uses can greatly reduce electricity consumption.”

Other changes include installing solar geysers, hot-water heaters and geyser timers so the geyser is not on when tenants are not in the property. Ensuring air conditioning systems have good energy ratings and are serviced and maintained will also help reduce electricity use.

“From the tenant’ s perspective, a small change that costs nothing, but has significant impact is to change behaviour – so simply switch lights off if they are not in use. ”

Property owners can go green – and save on the cost of their electricity consumption – by starting with small changes.