Property Professional - March/April 2015 by Property Professional

SHOULD YOU BE EXPANDING

INTO AFRICA?

THE RENTAL HOUSING TRIBUNAL WEIGHED UP HOW TO SHAKE UP YOUR REAL ESTATE GAME

Fast facts about Rebosa FIND OUT HOW TO JOIN (AND WHY) ON PAGE 22

CREATE A VALUE PROPOSITION FOR YOUR BUSINESS

MARCH/APRIL 2015

is where the gold is. We are proud to announce that we were awarded Gold for the Best Real Estate Agency in Africa at the 2014 Overseas Property Professional Awards held in London. We also received Gold for the Best Online Service, Silver for Best Media (Imagine Magazine) and Silver for Best Global Estate Agency. Most importantly, though, weâ&#x20AC;&#x2122;re proud to say weâ&#x20AC;&#x2122;re South African.

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ED I T O R ’ S N O T E

EDITOR’S NOTE

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It seems that this year kicked off with great speed and that there will be quite a number of changes ahead for the property industry, from the Property Practitioners Bill to CPD training

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and BEE initiatives such as the One Learner, One Office programme.

https://twitter.com/Property_Prof

The year ahead will undoubtedly have its share of challenges too, with power cuts and as the

THE CREATIVE GROUP CEO ban on foreign ownership of land, as part of the government’s land distribution programme, 00646 BETTERLIFE DREAMS LOTTERY PROPERTY PROFESSIONAL - EARPIECES V5 RP.indd2015/02/0 1 Shaun Minnie become clearer, among other issues. 083 629 6081 There is, however, opportunity too, and in this issue we look at the prospects that expanding

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into Africa could provide for South African real estate companies. Commercial property insurance and retail design and development are key commercial property elements that we examine in this issue; while on the residential side of property, we take a closer look at the difference between value and marketability. We also share some insight into how estate agents can create value propositions to further their business, and how they can manage their cash flow more effectively and budget better for the lean times.

EDITOR Michelle Funke 011 462 8959 michellef@propertyprofessional.co.za ADVERTISING SALES Sarah Steadman 082 334 4367

With the demand for rental properties on the rise, it’s good to know that there are a number

sarah.steadman@thecreativegroup.info

of tools available to add significant value to letting agents. The rental housing tribunal is one of those tools, and in this issue we weigh it up against its international counterparts. As always, we have a mix of news and tech reviews, agent profiles and more to keep you up to speed with developments in the industry. We hope you enjoy this issue and we look forward to connecting with you through our website, www.propertyprofessional.co.za, or on social media.

ADVERTISING PRODUCTION & SUBSCRIPTIONS Nikki Barnard nikki@propertyprofessional.co.za ACCOUNTS & FINANCE Nicolette Lubbe 011 476 6293 PRINTING Paarl Media

MICHELLE FUNKE

michellef@propertyprofessional.co.za

Disclaimer: The publisher of this magazine gives no warranties, guarantees or assurances and makes no representation regarding any goods or services advertised within this edition. © Copyright The Creative Group. All rights reserved. No portion of this publication may be reproduced in any form without prior written consent from the publisher. The publisher is not responsible for any unsolicited material.

CO N T EN T S

CONTENTS 04 INDUSTRY NEWS

10 THE DIFFERENCE BETWEEN VALUE AND MARKETABILITY 14 GET INTO THE HABIT 16 TAKING A LOOK AT SA’S RENTAL HOUSING TRIBUNAL 24 DESIGNED FOR SELLING 26 BANK ON INSURANCE TO PROTECT COMMERCIAL ASSETS

30 PENNY-WISE AND POUND-FOOLISH 32 PROPERTY FINANCE IN SOUTH AFRICA 34 LOOKING TO AFRICA 38 NEW AGENTS 40 THE VALUE PROPOSITIONS OF AN ESTATE AGENT

42 HOW DOES RENTAL PROPERTY MEASURE UP? 44 TOP PERFORMING AGENTS 46 TECH TOOLKIT 48 DEVELOPMENT UPDATE 56 WORD ON THE STREET

Page 4: I N D U S T RY N EW S

INDUSTRY NEWS OOBA’S Q4 2014 RESULTS SHOW THAT THE SOUTH AFRICAN PROPERTY MARKET IS SET TO RISE IN 2015 Statistics released by Ooba for the fourth

“It is still a good time to gain a foothold

quarter of 2014 signal positive growth in

on the South African property ladder,

the South African property market in 2015.

particularly for first-time homebuyers, as interest rates are relatively low.

The quarterly Oobarometer shows that the property market fared well in 2014,

“And with one of the highest approval

with growth of 5.5% in the average house-

rates in the market, Ooba continues to

purchase price in the fourth quarter of

prove that using a bond originator gives

2014, compared with Q4 of 2013. The

homebuyers a better chance of getting a

average house-purchase price reached

competitive approval in the shortest possible

a high of R978 502 in Q4 2014,

time at no additional cost,” said Dyer.

compared with R927 381 in Q3 2013. Rhys Dyer, CEO of Ooba, said, “The 2014 property price growth rate is particularly significant considering the estimated economic growth rate of only 1.4% for last year. Improved lending conditions illustrated by Q4 2014’s higher approved bond size, lower average deposit and higher successful approval rates are expected to continue to positively influence the property market in 2015. “We expect interest rates in the first half of 2015 to remain unchanged due to the expected drop in inflation driven by the fall in fuel and food prices. This will give prospective homebuyers additional disposable income, positively affecting their ability to afford a home loan while keeping the property market buoyant.” Dyer sees improved growth in house prices in 2015 off the back of expected stronger local and international economic growth. Investor interest in the property market should partly drive this trend, with the buy-to-let market expected to show some recovery in 2015 to satisfy the increased demand for housing.

OOBA CONTINUES TO PROVE THAT USING A BOND ORIGINATOR GIVES HOMEBUYERS A BETTER CHANCE OF GETTING A COMPETITIVE APPROVAL

Page 6: I N D U S T RY N EW S

REDEFINE SECURES R4.1-BILLION LEAF CAPITAL PROPERTY PORTFOLIO ACQUISITION

Redefine Properties has announced the

In Gauteng, the acquired assets include

earmarked for refurbishment) and has delivered

acquisition of the Leaf Capital portfolio of

Bryanston properties Silver Stream Business

growth in lease renewals of 1.51% at a

properties for R4.1-billion, equating to an initial

Park, Silver Point Office Park, Crawford

weighted average escalation rate of 8.1%.

income yield of 8% and substantially enhancing

House and Hampton Office Park. It also

Redefine’s office portfolio in the Western Cape.

comprises Clearwater Office Park in Strubens

The portfolio includes developable bulk

Valley and Centurion Gate in Centurion.

at Black River Park, The Boulevard, Silver Stream Business Park and Centurion Gate.

Marc Wainer, executive chairman of Redefine Properties, said, “Acquiring this trophy

Leaf Capital is an unlisted company with nine

portfolio is a strategic triumph for Redefine.

substantial property assets in Gauteng and

Redefine will pay the purchase consideration

It is underpinned by high-quality income

the Western Cape. The properties are well

through assumed third-party debt of

streams from its large, excellently located,

located in major metropoles and benefit from

approximately R1.9-billion; 80% of

premium-grade office precinct assets.

strong lease covenants and quality tenants,

the balance will be settled through a

such as Amazon, Medscheme, Kumba Iron

placement of shares; and 20% will be

“The transaction includes a number of significant

Ore, Dimension Data and the Green Building

funded from existing cash resources.

properties, such as Black River Park and

Council of South Africa. The portfolio is

the Wembley Square development. These

underpinned by strong lease covenants, with

While subject to Competition Commission

assets change the face of our Western Cape

37% of the portfolio expiring in more than

approval and other conditions, the

portfolio, which will now include the top 5%

five years. The fund has maintained a tenant

deal is expected to take commercial

of quality office blocks in Cape Town.”

retention ratio of 82% (94% excluding buildings

effect from 1 March 2015.

NEW ACQUISITIONS FOR THE TOWER PROPERTY FUND Tower Property Fund has announced the

markets in high-growth nodes, close to

is in good condition, but a minor face-lift

pending transfer of R480-million worth of

commuter networks. The Shoprite Centre in

and enthusiastic management will add

properties into the fund’s portfolio, with transfer

Brits is situated at 50 Pienaar Street in the

enormous value. A new drive-through KFC

expected to be finalised by the end of April.

heart of the Brits CBD and is anchored by

was recently completed and plans have

Shoprite. “The centre has a very good mix of

been drawn to develop a new wing, which

The first office building is Unit 4 of Whitby

national tenants, providing Tower with strong

Tower could consider at a later stage.”

Manor Office Estate, which is situated just

cash flows into the future,” said Edwards.

off the M1 motorway in Gauteng and which

Tower plans to roll out an occupancy-cost-

was purchased for R51-million. The second

The Shoprite Centre in Modimolle (formerly

reduction strategy to these new buildings, with

office-building purchase, at a cost of R192-

Nylstroom), situated in Nelson Mandela

a strong focus on ‘greening’ underpinning

million, consists of the majority of sections of

Drive, was built approximately five years ago

the fund. This pipeline of properties is coming

the Sunclare office block, which is located

and is anchored by Shoprite until November

from the private sector, where landlords are

on the corner of Protea Road and Dreyer

2018. “Located on the main arterial route into

prepared to take a percentage of Tower

Street in Claremont, just across the road from

Modimolle and approximately five kilometres

shares as currency for the transaction.

Cavendish Square. “Tower has purchased the

away from the Modi Mall, this centre also enjoys

majority of this terrifically located building,

a strong national tenant presence of over 75%.”

which is perfectly poised to capitalise on

As Tower is an REIT, holding the shares provides vendors with capital gains tax relief as well

its location and offers competitive rentals

The Shoprite Centre in Ennerdale is situated

to smaller businesses,” said Edwards.

in Marais Close in a middle- to lower-income

as diversification from single-property risks.”

area. “The centre is anchored by Shoprite

A further R500-million worth of commercial

The three retail properties purchased by

until May 2021 and has approximately

acquisitions is in the due-diligence phase of

Tower are nonmetropolitan shopping and

2 000m2 of additional bulk available for future

acquisitions. Tower expects its total portfolio

community centres servicing the lower-LSM

development,” said Edwards. “The centre

to increase to R3.5-billion by June this year.

Be more savvy when buying a home

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New partners from Z Capital Amanda Jivhuho and Yolanda Cuba sign a deal with RE/MAX of Southern Africa in our traditional markets with experienced, producing sales associates who provide an ethical, professional service to their customers,” said Gilmour. “We will, in addition, provide a system for entrepreneurs who have the ability to be the next real estate stars to become producing sale associates who can build a sustainable career in the real estate industry.” He notes that nearly 30% of the current RE/MAX membership in southern Africa consists of agents of colour, many from disadvantaged communities around the country, compared with the industry

RE/MAX OF SOUTHERN AFRICA CONCLUDES EMPOWERMENT DEAL

number of about 5%. “We plan to grow in 2015 with the many entrepreneurs from disadvantaged backgrounds who presently

Celebrating its 20th year in the South

Yolanda Cuba, chairman of Z Capital,

have no employment and who would like to

African real estate industry, RE/MAX of

said, “We are very excited to pioneer black

build a business in the real estate arena.”

Southern Africa announced in January

ownership in the largest real estate group in

that Z Capital Properties, a prominent

the country and plan to be closely involved

RE/MAX has also entered the affordable-

black-empowerment firm, has purchased

with the growth and developments of our

housing market with the establishment

a 45% ownership interest in the company.

entrepreneurial estate agents going forward.”

of RE/MAX Kairos in Soweto, and it

This decision was made in order to

plans to grow this market rapidly in

position RE/MAX for continued growth

Amanda Jivhuho, CEO of Z Capital, said

2015 to assist first-time homebuyers

in all markets in the next 10 years.

she was looking forward to taking the

in investing in their first home.

leadership role in the real estate industry “We have taken this important step to show

and to working closely with the EAAB and

RE/MAX of Southern Africa CEO Adrian

the industry and our local clients that we are

the government to unlock the huge potential

Goslett said, “In the next five years our goal

serious about leading the industry into the next

there is for home ownership in the country.

is to double our agent count by moving

decade of real estate,” said Peter Gilmour, chairman of RE/MAX of Southern Africa.

into areas we do not serve at present and The BetterLife Group facilitated the financing

to continue to improve our professionalism

of the deal and intends to offer increasing

and service to our real estate customers.”

As the largest real estate company in South

opportunities to RE/MAX offices and agents

Africa, with more than 2 200 agents and sales

to increase their income in the future.“Our

In 2015, RE/MAX intends launching

exceeding R22-billion, RE/MAX of Southern

vision is to continue growing our market share

exclusive, innovative technology for its agents

Africa operates in 10 African countries “The Department of Human Settlements and the EAAB have in recent statements and in proposed legislation to be implemented in 2015 shown that transformation is very high on their agenda, and RE/MAX wanted to be the first real estate group out of the top six groups in the country to introduce black ownership at the highest level,” said Gilmour.

THIS DECISION WAS MADE IN ORDER TO POSITION RE/MAX FOR CONTINUED GROWTH IN ALL MARKETS IN THE NEXT 10 YEARS

and will also open an in-house training and licensing school for entrepreneurial estate agents. Personal development programmes will be introduced for experienced agents and a number of prominent overseas trainers will be in South Africa to train RE/MAX agents. “RE/MAX will fully support the EAAB’s One Learner One Office programme and will use the training and licensing school to facilitate this,” said Gilmour

FIXTURES AND FITTINGS CLAUSE IN SALE AGREEMENTS NOT TO BE OVERLOOKED Is the demountable wall partitioning, undercover parking, security door fixed to a home removable or has it acceded to the premises? Can a seller allege that the awnings he affixed do not make out part of the land sold? The law states that unless otherwise agreed, all ‘fixtures and fittings’ (items that have been attached to the property with a degree of permanence) form part of the property. So, unless it is specifically agreed in the agreement that the seller may remove certain fixtures, these must remain on the property when it is sold. It is not so simple in practice to determine if a fixture has acceded to land or not. Guidelines crystallised from court cases show that the enquiry hinges on : • the nature of the thing; • the manner in which it is attached; and • the intention of the owner at the time of fixing the thing to the property. Each case is determined on its own facts. To illustrate, the facts in Unimark Disbtributors v Erf 94 Silvertondate (Pty) Ltd are interesting.

Here an erstwhile lessee of commercial premises claimed return of goods installed on premises after he was evicted and the landlord had sold the property to a third party. His claim related to items such as partitioning, an alarm system, intercom system, built-in sink, undercover parking, steel canopies and so forth. In determining the intention of the tenant at the time the items were fitted, the Court also had regard to the ‘publicity principle’, the impression created with others, including prospective buyers and how they would interpret what they saw. The Court here held that in the particular circumstances of the case, the partitioning, the alarm system, the intercom system and air conditioners had remained the property of the tenant but that the carport, built-in sink and undercover parking had acceded to the land. Make sure there are no misunderstandings and deal carefully with fixtures and fittings in the agreement, or consult your conveyancer to assist at info@stbb.co.za or on www.stbb.co.za.

HANDS-ON IN ALL YOUR LEGAL MATTERS

MORE THAN JUST THE PAPER WORK

Page 10: I N V ES T M EN T

THE DIFFERENCE BETWEEN VALUE AND MARKETABILITY Industry experts explain how to make sure you maximise on both the value and the marketability of a property

Page 11: I N V ES T M EN T

Value and marketability are key concepts in the

“Sellers of properties must thus think like

property investment field. You need to know the

buyers and the estate agents must assist sellers

difference between value and marketability to

in achieving the best price while selling the

ensure you are maximising on both and that

property within a reasonable timeframe.

the property sells for the best possible price. The complementary relationship between these

Buyers are aware that they do not want to

concepts will guarantee a successful sale for

pay more than the average market price of a

your customers.

property. That is why many service providers

VALUE

offer a CMA service. The CMA provides information about properties sold in the

According to Berry Everitt, MD of Chas Everitt

neighbourhood, recent prices achieved and

International Property Group, “value is about

general information about the property, to

price, in comparison with similar properties that

compare apples with apples. The CMA also

are on the market in the same area at the same

provides information related to an estimation

time”. “Homebuyers are comparative shoppers,

of the property’s current worth, price trends,

and it is essential that the agent understands the

recent sales, deeds office and surveyor-general

direction of his local market at any particular

information, the municipal valuation of the

time and can advise his client accordingly, in

property, suburb trends, owner information,

conjunction with the latest comparative market

selling history, transfer history and aerial and

analysis (CMA) sales statistics.

map views.

“If prices in the area are trending downwards

Estate agents worth their salt (and professional

because there are more homes for sale than

fee) will, however, not accept the CMA

buyers, the seller who wants to attract the most

valuation and will always try to sell the

possible interest and achieve a quick sale will

property for more. The estate agent must use

need to set his asking price slightly lower than

his or her professional skill, years of experience

the latest sales prices recorded in the CMA.

and industry know-how to raise the asking price

And, of course, the opposite is also true, but the

to such a level that it is in between a price that

keys here are really up-to-date information and

will not achieve a sale and the CMA valuation.

knowledge about how to apply it.”

If every seller accepted a price in line with the CMA, the property market would stagnate.

Electronic media and digital information have changed how we do business at a fundamental

Estate agents should try to stretch the purchase

level and have created modern, tech-savvy

price to just before the breaking point, and then

consumers who have a wealth of information

trim the price down from there.”

at their fingertips via mobile phones, computers and tablets. Searching online has become the

Once the value has been determined through

easiest and fastest way to find properties to

a thorough CMA, it is time to move on to the

buy. Almost every site offers tools for comparing

marketability of a property, as both are needed

prices, features and neighbourhoods.

in order to sell the property for the maximum price within a reasonable time frame.

How does this equate to determining the value of a property? Says Meyer de Waal, director

MARKETABILITY

of Oosthuizen & Co, “Property search engines

So what is marketability? Says Herschel Jawitz,

list multiple properties for sale, and prospective

CEO of Jawitz Properties, “Post the financial

home buyers will be able to filter the area,

crisis, buyers – even those at the upper end

price and specifications of many properties,

of the market – have been focusing on value,

most often before they contact an estate agent

which is the combination of price, position

to identify their best selection to view, with the

and size. Buyers will look at different houses

intent to buy.

in different areas to see what they can get and

Page 12: I N V ES T M EN T

for how much. Homes in good areas but that are

Says Adrian Goslett, CEO of RE/MAX of

less exclusive than more expensive areas will

Southern Africa, “Marketability is often the

offer bigger land, more accommodation, a better

reason why properties are listed in spring, as

home or a combination of all three, compared

their gardens look more pleasing when the

with a similar home in a more expensive area for

flowers are in bloom.

the same price or even a lower price. “We have even seen those trends in the more upmarket areas where, traditionally, buyers focus

“THE FIRST-TIME-BUYER MARKET IS ALWAYS DRIVEN BY VALUE” Herschel Jawitz

only on the ‘old’ property mantra of ‘position, position, position’. The first-time-buyer market is

“Staging the property will also have an impact on its saleability. It is advisable to de-clutter the home but keep it furnished. An empty home will make it potentially difficult for buyers to see themselves living there. An experienced real estate agent will

always driven by value, where buyers will look

be able to provide valuable advice regarding

outside the more expensive suburbs in order to be

staging the home and making it more appealing

able to get into the market.

It is appealing to prospective buyers, and will

on show days.”

in turn help the property to sell in a reasonable “Marketability includes the concept of value but

time frame.

also talks to the presentation and the condition

While there is a distinction between value and marketability, in order to achieve the best selling

of the home: how does it present to the buying

There are many tips and tricks to increasing

price for a property and sell it within a good

public? As agents we have to focus on both value

marketability, from really small things – such

turnaround time, you need to make sure that

and marketability, not only for the house that we

as a fresh coat of paint, a landscaped garden

value and marketability work hand in hand for

are selling, but also compared to other similar

and a clean outside wall with a visible property

a favourable outcome. Neither is more important

homes in the area.

number – to more in-depth measures, such as

than the other. Without a competitive value and

painting the inside of the house, steam-cleaning

correct CMA of the property, you may arrive at

“Homes that are overpriced relative to the

carpets, ensuring all the lights work and have

a value that hinders its sale. In much the same

competition – other similar homes for sale – tend

fresh light bulbs and ensuring all the plug points

way, marketability ensures that the property is

to be used by agents as a basis for selling the

work, to fixing any stains or damage to the walls.

seen by the right people in the best possible

homes that offer better value. The challenge is to

You don’t have to alter the physical features of the

way and encourages buyers to buy at the

help sellers understand this concept of value and

property to increase its marketability.

best possible price.

what drives the decision by a buyer to buy one house and not another.” According to Steve van Wyk, MD of Seeff Centurion, when you are looking at determining marketability you need to ask the following questions:

PROPERTY STATISTICS

1. Is the property priced correctly?

According to PropStats, properties priced for

days on average and achieved 12.4% less

2. Is there a demand for property in that area?

less than R10-million (captured in November

than the asking price, while in November

3. Is the property in a saleable state compared

2014) sold in 85 days on average and

2013 properties captured sold in 95 days on

achieved 5.8% less than the asking price –

average at 12.2% less than the asking price.

with similar properties?

an improvement on the November 2013 stats The condition of the property is paramount to the

of 86 days at 6.8% less than asking price.

value, and this is where marketability and value

Although properties took longer to sell, more than double the number of properties

work hand in hand. How ready is the property

Properties priced at more than R10-million

sold for more than R10-million in 2014 as

to sell, and what can you do as an estate agent

(captured in November 2014) sold in 170

compared with 2013.

to ensure that the marketability of the property helps the value and increases the chances of the property selling? A property that is clean, neat and has been well maintained is a property that is marketable.

BY ANGELIQUE REDMOND

GET INTO THE HABIT

Has the time come to shake up your real estate career? Here are eight tips that will help you up your game

RISE AND SHINE There’s a great deal of truth in the adage, ‘the quietest time is just before dawn’. Set your alarm a little earlier and use the quiet time to go though your emails, sort out your diary for the day and plan for what’s ahead.

Most of us begin a new year with a whole lot of vigour, determined to

Many people find that they are able to come up with the best ideas

improve our performance, make millions and show our colleagues a thing

when their brains are refreshed by sleep, so use this time to focus on

or two – until the monotony of the daily grind kicks in. Being creatures

challenging issues that cropped up the day before. It’s difficult to make

of habit, many humans tend to repeat the same pattern year after year

rational decisions when we are emotionally charged, and it’s amazing

and to resort to bemoaning their lot in life when nothing changes. Estate

how a good night’s sleep can bring problems into perspective.

agents are no different: while the go-getters consistently throw themselves into their work, the average Joe sits back and waits, hoping that his ship

EXERCISE

will come in sooner rather than later. We’re not going to bore you with a whole lot of scientific data about Trainers and motivational speakers have made it their life’s work to

endorphins and how these positively affect the body, except to note

help agents up their game, but talk is cheap. Unless people committ to

that there really is such a thing as runner’s high. There is a very good

modifying how they think, work and play, nothing is going to change.

reason why some people are addicted to exercise: it makes them feel tremendously good and those who feel great about themselves achieve

Very often, it’s the small things that we don’t do that affect us the most.

more in every area of their lives. Go for a walk/run, attend a yoga class,

Entrepreneur magazine has highlighted eight daily habits that could, if

get on the golf course. It doesn’t matter what you do as long as you do it

you stick with the programme, lead the way to phenomenal success.

for at least 30 minutes a day.

Page 15: G O O D H A B I T S

PRACTISE GRATITUDE

are still in the market, emails need to be responded to and telephone calls need to be returned. Schedule all of these things into your day, and if for

Let’s be honest: it’s often far easier to focus on the negative instead of

some reason you are unable to do what needs to be done on a specific

being grateful for what we have and yet those who acknowledge the

day, reschedule it for another time.

good things in their life on a daily basis tend to enjoy far more success than those who don’t.

FOCUS ON HIGH-PRIORITY TASKS FIRST

In his book titled Great – A Guide To Surviving Under Pressure, former

This is an obvious tip and you have to wonder why Entrepreneur

Manchester United goalkeeper Gary Bailey highlights the importance

magazine even bothered with bringing it up. Of course we concentrate

of being grateful. “When pressure hits you, you need to focus your

on the most important things first! Right? Actually, many of us don’t,

mind. The simple truth is you cannot be unhappy and grateful at the

and we end up putting high-priority tasks on the back burner until the

same time. If things are going badly in business or at home, you will

last possible minute, either because the task is daunting, or because we

not be successful and one of the easiest ways in which to become

assume we will have more time to dedicate to the endeavour.

happy is to think of something to be grateful about.” He says that it’s not good enough to merely think about everything you are grateful for;

Whatever the reason, challenge yourself by tackling the most important

you actually have to show appreciation for what you have in order for it

things first, regardless of how uncomfortable they make you feel. We

to have an effect.

all tend to worry far more than is necessary and very often spend more time overthinking a problem than actually dealing with the issue at hand.

He notes that studies showed that people who keep weekly gratitude

However, once the “problem” is resolved, we are able to concentrate far

journals exercised more regularly, reported fewer physical symptoms,

better on the less demanding tasks and become far more effective.

felt better about their lives and were more optimistic about the upcoming week, as compared with those who recorded hassles or

GO THE EXTRA MILE EVERY DAY

neutral life events.

READ

Challenge yourself to do that little bit extra every day. Push yourself, and if you’re pounding the streets looking for listings, go and knock on a few more doors before calling it quits. Stay in the office a little later

“I find television very educating. Every time somebody turns on the set,

and concentrate on finishing all of the tasks you have scheduled for the

I go into the other room and read a book,” wrote Groucho Marx.

day. It has often been noted that successful agents go way beyond the call of duty when they sell a home. Loyal buyers and sellers deal with the

It doesn’t matter what you read, as long as you are taking the time to

same agents for a reason – they are receiving an above-average service.

broaden your horizons by picking up a book, clicking on an interesting

Helping a buyer (particularly those who are new to the area) by directing

article on the internet or reading a magazine. Not everything has to

them to the municipal offices or doing a bit of research and finding out

be about work, and the advantages of reading a good novel cannot

which schools have the best reputation in the area will set you above the

be overstated. Reading helps stimulate thought processes and new

competition.

ideas. It’s also a valuable tool for lifting the mood. Doctors have been recognising the benefits of reading since the Second World War, when

IMPROVE IN ONE AREA EVERY DAY

it was discovered that it helped cure the depression of injured soldiers. So, find a quiet spot, kick back and relax, and try to read for at least half

It doesn’t matter what you do and it doesn’t necessarily always have to

an hour every day.

be work related. Set yourself a goal to improve in one area of your life

SET UP, AND STICK TO, A SCHEDULE

every day. Slowly but surely you will start to see a major difference in your life. You will be happier and – guess what – happy estate agents are successful estate agents.

People who work to a schedule are far more productive than those who simply adopt a wait-and-see attitude. Agents do have to be flexible, to a certain degree – after all, you never know when a new buyer is going to walk through the door or when a hot new listing is going to come onto the books. However, this doesn’t mean that you should sit back and haphazardly try and get around to all that needs to be done. Sellers need feedback on their properties, buyers need to be contacted to ensure they

BY LEA JACOBS

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T A K O O L A’ S A G C I N I R K F TA U T H A SO L

A T N E R SING U L O A H N U B I R T

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The rental housing tribunal is one of the many tools available to the property professional in South Africa and when used correctly it can provide significant value to your letting business. We take a closer look at what the tribunal does, the latest legislation that regulates it and how it fares against similar organisations around the world. The rental housing tribunal is an organisation in South Africa that

issue before the tribunals is the return of deposits. Critical here is

seeks to balance the rights of landlords and tenants in the residential

compliance with the legal requirement to carry out ingoing and

leasing environment. It often deals with and resolves disputes that

outgoing inspections of the property. A detailed and effective inspection

arise between tenants and landlords by applying the provisions

is best. The only allowable deductions are those that are allowed in

set out in the Rental Housing Act (RHA). The tribunal provides a

terms of the lease. Invoices or other documentation must be produced

free service, one that seeks to ensure equality between tenants and

to provide evidence of the need to deduct the amounts in dispute.”

landlords and to educate tenants and landlords about their rights and obligations under the RHA and the Unfair Practice Regulations.

BENEFITS TO THE PROPERTY INDUSTRY

Tracy Pugin, principal of Seeff Rentals Randburg, says, “This is a free service to the public; they are quick, and insist on a timeframe in which a landlord must respond. Agents often refer tenants and

Dexter Leite, rental manager for Pam Golding Properties in the

landlords to the tribunal if no agreement can be finalised between

Western Cape, says, “The rental housing tribunals regulate

them. We find the tribunal really convenient, as agents don’t always

and balance the relationship between (residential) landlords

have all the answers and we can turn to the tribunal for advice.

and tenants by virtue of the legislative framework imposed on

The lease is there to protect both landlord and tenant, but we have

residential leases through the RHA and the Unfair Practices

many instances where tenants and landlords just disregard the

Regulations, which seek to ensure that unfair practices between

lease. This is where it is especially handy to have the tribunal.”

landlords and tenants are (a) defined and (b) eliminated.” The Unfair Practices Regulations are extensively detailed, Leite explains. For example, they prevent landlords from unilaterally

TYPES OF DISPUTES DEALT WITH BY THE TRIBUNAL

changing locks, unless this is necessary owing to fair wear and tear and is agreed upon by both parties. Also, according to the

•

Failure to adequately maintain the premises

regulations, the premises must, from the commencement of the

•

Unlawful repossession of and unlawful evictions from the property

lease, be reasonably fit for the purposes for which they are let. •

Failure to accept notice and vacate the premises

The Unfair Practices Regulations provide detailed explanations

•

Unlawful seizure of possessions

as to how the requirements of the Act are to be implemented.

•

Failure of a landlord to provide municipal services

•

Attempts by either party to unilaterally change the terms of the lease agreement

Tribunals deal with disputes either informally – advising, guiding and mediating between the relevant parties – or by way of

•

Unlawful notices to vacate the premises

formal hearings, where evidence can be led and witnesses can be called to testify by landlords or tenants respectively. It is vital that estate agents who manage and let properties are Helen Henning, principal of Seeff Rentals Pretoria East, says the

familiar with the functions of the rental housing tribunal and

tribunals help the industry and tenants “by providing a cheap

the Rental Housing Act. Knowing and understanding the Act

alternative to costly and time-consuming legal processes”. “Many

puts agents in the position to make the laws and regulations

disputes can be solved by having an independent mediator between

governing the landlord-lessee relationship work for them. And

the parties,” Henning continues. “I have found the advocates at

with legislation continually evolving, estate agents who keep

the initial hearings to be fair and balanced in the main. A common

up to date on the latest amendments will benefit even more.

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DRAWBACKS OF USING THE TRIBUNAL Says Leite, “The tribunals are not accessible to all, although hearings and mediations are dealt with as close to the complaint as is practical and possible. They do not have a defined appeals process, although a review process is provided for. The determination or mediation by a rental housing tribunal is governed by the member’s knowledge of the leasing process, the environment and the laws governing it. “There is a large, ‘informal’ rental market where, in its simplest form, rooms in houses, on properties, in backyards and so on are rented. This is a complex social matter: these tenants do not necessarily have knowledge of or access to rental housing tribunals and there is risk of exploitation. (This is not our target market but these social problems and challenges do exist).

Says Henning, “The service could be improved if a lot of issues could be identified and dealt with via a ‘ruling’ or guideline approach to common complaints or problems. “My advice to those seeking relief from the rental housing tribunal is to go well prepared. Stick to facts and resist the urge to be emotional. I would advise any agent called to a hearing to take all relevant documentation.”

NEW LEGISLATION The Rental Housing Amendment Bill of 2014 was signed into law by President Jacob Zuma on 5 November 2014. While the date for its promulgation has not yet been announced, once it is, tenants and landowners in South Africa will have six months before additional or amended obligations become effective.

“The process can be exploited by serial complainers, wasting time and resources. No costs are awarded: all parties carry their own costs in

How will this affect tenants and landlords? Below are the main points that

preparation, time, travel expenses and the like.

all estate agents should be aware.

“Other feedback given by people who have used the rental housing

“Habitability” is now included in the amendments, as a dwelling that is

tribunal is that most of the offices are manned by call centre personnel, and one drawback to this is that the answer time for calls can be especially long. It is also difficult to ensure that every person who is answering calls and dealing with tenants or landlords is well versed in the specifics of the rental housing tribunal.

IMPROVING THE RENTAL HOUSING TRIBUNAL The rental housing tribunal organisation as a whole could be improved through the use of one concise website for the public and estate agents, explaining what the tribunal does, where their nearest office or branch

safe and suitable for living in with adequate space, protection from the elements and other threats to health, physical safety of the tenant, the tenant’s household and visitors, and a structurally sound building. Training of members or commissioner and staff is now a national mandate to ensure the public receives a better service. “The national government must develop and fund programmes to train members of the tribunals and officials appointed in terms of section 14(2).”

that can help them is and how to go about utilising this service. In addition, literature that is easy to understand and well written would greatly help tenants who don’t necessarily need to utilise the services of the tribunal but could benefit from education on their rights.

LANDLORDS

TENANTS

THE TRIBUNAL PROVIDES A FREE SERVICE, ONE THAT SEEKS TO ENSURE EQUALITY BETWEEN TENANTS AND LANDLORDS AND TO EDUCATE TENANTS AND LANDLORDS ABOUT THEIR RIGHTS AND OBLIGATIONS UNDER THE RENTAL HOUSING ACT AND THE UNFAIR PRACTICE REGULATIONS

OVER THE PAST 30 YEARS WE’VE MADE OUR HOME IN NEIGHBOURHOODS ACROSS SOUTH AFRICA.

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WHY JOIN US? •

Our in-house training academy offers comprehensive and ongoing training that ensures that our agents are successful from day one.

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We provide technology and systems that maximise successful sales efforts.

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Our brand is fresh and eye-catching and our marketing and advertising stands out from the crowd.

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Our Rawson Referrals Department manages referrals of property leads between Rawson agents throughout South Africa, allowing for additional income potential.

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Our in-house bond origination company makes getting a bond simple and fights for each property deal so you don’t have to.

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AT THE RAWSON PROPERTY GROUP WE RECOGNISE THAT IT’S OUR TEAM THAT MAKES US GREAT.

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Page 20: R EN TA L H O U S I N G T R I B U N A L

where possible, facilitate the provision of basic services

THE AMENDMENTS

to the dwelling. •

•

“Landowner”, as a gender-neutral term, will replace ‘landlord’,

of members will increase to seven, with not more than two

in keeping with the constitutional mandate to develop the common law. •

All leases must be in writing.

•

The minister is required to provide a pro forma lease in 11 official languages.

•

legal practitioners. •

tribunal becomes two committees with a minimum of three members or commissioners for each sitting. •

An aggrieved party can appeal the tribunal’s decision to a panel of adjudicators, so that the aggrieved party does not have to

a century ago, namely that the landlord is under duty to

incur legal costs for an appeal to the High Court. •

The MEC for human settlements is tasked with setting up the

fit for the purpose for which it has been let, will now change

panel. A party will still have the right to bring the tribunal’s

to “habitability”.

proceedings under review, including an appeal adjudicated

The common law position regarding the tenant’s acceptance

by the appeals panel.

of the dwelling in a state of disrepair or taking over the

•

landlord’s common law duty to maintain by contracting out of the common law, will no longer apply. This is due to the

Rental housing information offices must be established by municipalities, to provide advice to tenants and landowners.

•

The minister of human settlements must alleviate hardships

introduction of the definition of “maintenance that includes

experienced by tenants by monitoring, assessing and developing

such repairs and upkeep as may be required to ensure that a

relief measures and other social programmes for poor and

dwelling is in a habitable condition…” •

Two simultaneous hearings in a province can be held. The

The law formulated by South African courts more than deliver and maintain the property in a condition reasonably

•

The composition of the tribunal will also change. The number

In terms of section 4B 11, a landowner is now required

vulnerable tenants and those with disabilities. •

Many of these points will ensure that the rental housing tribunal

to provide a dwelling that is in a habitable condition, as

functions more efficiently and which highlight the efficiency and

well as maintain the existing structure of the dwelling and,

progression of the South African property industry.

GLOBAL COMPARISONS

When you compare the dispute resolution services offered by South

Comparing the rental housing tribunal system and the proposed

Africa to those offered on a global scale, it is fantastic to see that we are

amendments to the Act to others around the globe, the South African

on par with global standards.

system is fairly progressive and in line with its international counterparts. While there are improvements that could be made to ensure the tribunal In Australia, for example, there are two governing bodies that settle

functions more efficiently, the proposed changes that will come into

disputes in the residential property sector. The first is the Queensland

play during 2015 will see the rental housing tribunal reach new heights

Civil and Administrative Tribunal, and the other is the Residential

and ensure that South Africa remains on par with global standards in

Tenancies Authority. They both decide on a range of residential tenancy

residential property dispute resolution.

disputes that mirror those of the residential housing tribunal, but one service they offer that isn’t available in South Africa is dispute resolution over the phone between both parties. In Germany and America there are local tenants’ unions and associations that provide support to resolve disputes before the legal route is taken. These are not associated with the government but are independent bodies set up through regions or neighbourhoods. While the United Kingdom has a system similar to South Africa’s, a first-

THE PROPOSED CHANGES THAT WILL COME INTO PLAY DURING 2015 WILL SEE THE RENTAL HOUSING TRIBUNAL REACH NEW HEIGHTS

tier tribunal called a property chamber for residential property has five regional offices that provide an independent service in the UK for settling disputes involving private rented and leasehold property.

BY ANGELIQUE REDMOND

Looking for a South African solution? RealNet is adapting and creating value in SA’s changing landscape…

What does RealNet Holdings offer prospective franchisees? ✓ At RealNet we focus solely on being a franchisor capable of formalising different franchise models to cater for different franchisee scenarios. We also keep an eye on trends, legislative changes and all the other important aspects that an independent business owner will battle to keep abreast of. ✓ The present and future real estate industry requires knowledge and skills in several related disciplines, such as the legal, financial and marketing sectors. This necessitates strategic thinking, careful observation, exceptional business planning and relentless implementation. Our unique tandem franchise opportunities are tailored to accommodate qualifying new entrants to the market. ✓ At RealNet Holdings we commit ourselves through proper upfront disclosure, continued transparency, insight into tried and tested business practices, know-how, efficient systems and tailor-made IT solutions, as well as standard operating procedures, continuous training and development and marketing support. Staying abreast of research, new technology, social media marketing trends and so on, is where we play a significant role. ✓ By allowing the business owner to concentrate on the operational and sales activities at the coalface, thereby increasing sales without necessarily increasing overhead costs, the implementation of a tailor-made South African franchise solution can result in a substantial competitive advantage.

RealNet isn’t intimidated by change, it welcomes it. Joining the RealNet network will take your business to new heights.

How can prospective franchisees benefit from joining RealNet? ✓ At RealNet we embrace diversity and offer different franchise models to accommodate and provide solutions across the whole South African market spectrum. ✓ Our RealNet executive and our senior management team are highly experienced and qualified in their respective fields. ✓ We do not offer a standardised ‘business in a box’ solution that we are using under license from abroad. We work with each franchisee’s unique qualities, plans and circumstances in the South African context. ✓ We help franchisees achieve compliance and professionalism through our own expertise as well as engaging them in continuous professional development. ✓ We manage formal service level agreements with a variety of service providers to ensure that our franchisees have access to the best available technology with the requisite training to master it.

For real estate franchise opportunities contact: Tommy Thompson 082 920 9022 tommy@realnet.co.za www.realnet.co.za

PROPERTY PRACTITIONERS BILL

Fast facts about Rebosa Rebosa (the Real Estate Business Owners of South Africa) was established for the real estate industry – specifically, the business owners and principals in the industry. But what exactly is it? We spoke to Jan le Roux, CE of Rebosa, to get all your questions answered. Why join Rebosa?

What kind of challenges will Rebosa tackle?

The residential property sector in South Africa contributes a staggering R123,8 billion to the economy – we need a collective voice to address our specific concerns and ensure they are dealt with. Rebosa is that voice for the real estate industry.

The major concern in the current Act is the issuing of Fidelity Fund Certificates (FFCs). The administrative issues in the issuing of FFCs mean that agents could forfeit their commission entirely. REBOSA currently interacts and follows up on outstanding FFCs. This is just one of many ways we work together to achieve great things.

Why do we need an organisation to do it? Transformation in any industry is inevitable, but if we want the real estate industry to grow and prosper, that transformation process must be handled smoothly, through all the right channels. As a united front, Rebosa can interact with all the stakeholders in the real estate industry to ensure we all get the results we want.

Why join now? In 2015, the Property Practitioners Bill will replace the current Estate Agency Affairs Act of 1976. But there are serious flaws in the legislation that we need to fix – fast. This can only be done if a critical mass of real estate agents unite and use their collective power.

“

To be effective, we need the vast majority of business owners to become members Jan le Roux, CE Rebosa

”

Together we can achieve what individually we cannot!

Why do we need you? The real estate industry is made up of big and many, many small businesses, all doing what we do best – selling property. But if we want to be truly representative, we need to ensure all our voices are heard. We need to know what the issues are and how best to fix them. And the only way to do that is by having you on board. Every one of you.

How much does it cost? Only R20 (excl VAT) per registered estate agent per month.

How to join 1 - Go to www.rebosa.co.za 2 - Complete your membership application 3 - Or contact Dee on info@rebosa.co.za 4 - Membership fee is only R20 excl VAT multiplied by the number of registered estate agents (inclusive of Principals) per office per month 5 - For queries relating to FFCs contact Fiona on fiona.rebosa@gmail.com

Membership Application Trading name of estate agency Registered owner (if not the same as above) CC PTY LTD Sole proprietor Trust □ Vat number (if registered as a vendor) Physical address

Postal address Office telephone number Full names of managing principal Managing principal’s cell phone number Managing principal’s e-mail address Name of agency contact person (if not the managing principal)

Contact person’s cell phone number Contact person’s e-mail address Commercial: YES / NO

Residential: YES/NO

No. Principals

No. Agents

No. Intern Agents

No. Em ployees

TERMS AND CONDITIONS OF MEMBERSHIP FEE STRUCTURE A membership fee calculated at R20.00 plus VAT per registered agent (inclusive of principals) per agency is payable monthly.

Signed at ___________________________________ on this day __________of_________________ 2014 Signature on behalf of registered owner: _______________________________________________

Membership of Rebosa is subject to the Rebosa Memorandum of Incorporation of a Non-profit Company. By signing this membership application form, I agree that the company, Rebosa, may send me relevant updates and electronic communications as contained in the objectives of the organisation.

APPLICATION PROCESS Once your application has been submitted, an invoice for payment will be sent to you. On receipt of payment, the process to ratify an application by the Rebosa Board will commence and will take 7 to 10 days to complete. Following this, a communication will be sent to you, confirming your membership. A copy of both the company’s and the principal’s current FFC must be attached to your application when you submit it. Membership forms can be submitted via e-mail to info@rebosa.co.za, or faxed to 086 604 7245.

DESIGNED FOR SELLING

The debate as to whether retail centres should be designed as practical business centres or theatres for entertainment continues to spark innovation and collaboration

Modi Mall Limpopo, designed by Franzen Architects of Pretoria and winner of the 2014 Category B winner: SA Council for Shopping Centres and Retail Development Awards – Shopping Centres Smaller Than 20 000m2 The livelihood of retail centres largely depends on global economic

Statistics SA reported the uptick in overall consumer spending to have

conditions, rapid urbanisation, population growth and increased

reached an all-time high of R183 3785-million in the third quarter of

consumerism, as well as on the efficiency with which operators meet

2014, compared with a record low of R260 612-million in the first

complex design and development challenges. Retail professionals say

quarter of 1960. Local consumer spending monitored by retailers

superior trading performance and the longevity of shopping malls

reflects varying shopper demands. The growing need for consumers

reflect architectural designs and built structures that came about through

to leave their homes, which may be located in high-rise apartment

consultation among business operators and users, and where engagement

buildings or outlying townships, relates directly to their need for

with local communities reflect an integration with urban spaces.

convenient, quality shopping and entertainment experiences.

Asset managers equate the increased delivery and proliferation of quality

Greater emphasis in the retail industry on the primary function of

real estate to the upholding and improvement of high standards within

aesthetically designed spaces as practical revenue-producing facilities

the listed- and private-property sectors. This practical investment approach

comes irrespective of the socioeconomic groups that make up the foot

extends to the ability of retail operators, who in a competitive business

traffic. A recent example of functional design and convenient access

environment are responsible for securing long-term leases and repeat

resulting in growth in trading is the award-winning Modi Mall, in

business from powerful anchor tenants amid varying economic conditions.

Limpopo. Increased foot traffic has raised the demand for tenancies over a short period and is set to improve stakeholders’ prospects of long-term

In his address at the International Council of Shopping Centres Industry

sustainability. Franzen Architects of Pretoria, the winner in last year’s South

Summit for sub-Saharan Africa last year, Mike Williams of Investec Asset

African Council for Shopping Centres and Retail Development Awards –

Management said, “One of the better parts of what we do is the positive

Category B for shopping centres smaller than 20 000m2, was awarded

socioeconomic impact of retail real estate.” He said that the industry

for the design of Modi Mall in cooperation with Longwalk Property

specialists that are active in this region, AT Kearney Consultants, had

Investments, Improk Properties and McCormick Property Development.

shown that if you do good business in Africa, you will make a difference. Increased consumer spending and subsequent demand for

Franzen said local residents had every reason to burst with pride

quality shopping at different ends of the retail market and

when their fashion mall opened its doors in August last year. “This

geographic locations is therefore fast debunking the age-old

award is aimed at outstanding creativity in the retail development

view in some design circles of shopping as a trivial pursuit.

industry, and highlighted the architectural design and finish of the

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centre, the type of tenants and the breakdown of tenants within the

tenants and anchor brands,

centre, as well as the layout and the geographic location of the

whose lease renewals can be the

centre.” Modi Mall was rated among top centres, including two

livelihood of a centre, rely as heavily

Gauteng finalists, the Olievenhout Plaza and the Club Retail centres.

on good locations as they do on efficient layout and design that eliminates dead space,

The strong relationship between the livelihood of industry specialists

poor flow and impractical shopping experiences.

and shopping centre design and layout reflects in the ability of service providers to fill retail space with quality shoppers that ensures

“When architectural awards are handed out, anchor

commitments to long-term leases and repeat business from tenants.

tenants and some line shops should be consulted, and their response to the building should also be taken into consideration.”

Retail operator Francois Coetzer of Retail Shop Space says spending

He said the recent letting of a 300m2 floor space with 16 corners

20 years in the retail letting arena has highlighted the needs of

to a pharmacy owner once again proved that higher levels of

tenants and shoppers alike: “While there is a place for prize-winning

consultation between end users and designers could only enhance

designs, as seen among super-regional centres in urban areas, the

foot traffic, repeat business and capital growth on investments.

trading performances and long-term profitability of retail centres is enhanced by architectural designs where consideration was given

Long-term sustainability remains a powerful attraction for the economic

to business performance and customer needs above aesthetics.”

success of centres, such as where escalating energy costs motivate the

00646 BETTERLIFE DREAMS LOTTERY PROPERTY PROFESSIONAL - EARPIECES V5 RP.indd2015/02/0 2

introduction of maximum volumes of natural light in ceilings, as seen Coetzer said shoppers are attracted by convenience of access for

at Kenako Retail Centre in New Brighton, Port Elizabeth, which was

practical, time-efficient, quality shopping experiences, whereas quality

Images below: Kenako Retail Centre, New Brighton, Port Elizabeth, designed by Stauch Vorster Architects

is that the centre is located in an accessible position, and that while

Added value at Modi Mall, says Sonja Beukes of Franzen Architects, it provides sufficient shopping space, it facilitates a small enough shopping environment where retail facilities are close together, with ample secure parking. “Superior quality security adds value to the positive shopping experiences of consumers, that facilitates 24-hour camera monitoring and car guards who are contracted out.” Innovative design solutions on local and global fronts have to cater for a multitude of constantly changing retail behavioural trends, such as a growing need for entertainment since the novelty of online shopping is slowly wearing off in affluent communities. Melbourne architect Neil Masterton, the design director of ARM Architecture and who was involved in the refurbishment of AustraliaOn-Collins, has been quoted as saying: “The early 21st century is a very interesting period for retail. In the context of e-commerce, bricks and mortar, retail is a complex amalgam of different issues created by the ease of online trading.” He relates the challenges of meeting shoppers’ needs for alternative urban shopping experiences over and above what online retail portals offer. Success stories of local, regional and global shopping centres reflect all-round consideration and consultation between top achievers within the professions of architecture, investment, development and built environments.

BY ANNA-MARIE SMITH

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FirstRand’s headquarters at Portside, Cape Town

BANK ON INSURANCE

TO PROTECT COMMERCIAL ASSETS Insurance on fixed property is fundamental to risk management Research shows that adequate insurance, including comprehensive cover on fixed assets, enhances business operations of large corporate owners and landlords, entrepreneurs and tenants of small properties. The recent publication of the Western Cape Government Financial Services Sector Research Report 2014, conducted in cooperation with the University of Cape Town and the African Institute of Financial Markets and Risk Management, noted the various benefits of adequate business insurance. Spin-off from long-term financial stability that enables market players to weather volatile markets is reported. Increased productivity and growth through heightened risk is rewarded by higher returns and a broadening of the range of immediate and potential investments as the result of risk protection. Global and local examples illustrate how large banking institutions which offer finance and insurance on property investments assist clients in generating sound business fundamentals. As landlords who provide large volumes of office space to employees, most retail banks are owner-occupiers of city properties in superior locations. Optimum risk management and returns on massive investments are complemented by the optimum utilisation of surplus space and by asset owners who become insurers, landlords and property managers. The resultant business banking and property loans are the ideal platform from which to facilitate comprehensive building and occupant insurance. Says Attie Anderson, First National Bank’s head of business lending property finance, “Insurance is critical for properties, irrespective of whether they are bonded to a financial institution or not.” The building is a means to make a living, not only for the many clients who trade from the building, but also for investors who have built a portfolio of rental properties. “Should the property be destroyed in either of the aforementioned cases,

Page 27: CO M M ERC I A L I N S U R A N C E

very few clients have the financial resources to replace the property from

cost of replacing a specific property

their own cash resources, and clients suffer a loss of income as a result.”

remains the same, irrespective of the area it is located in, while the location has

Careful planning at all levels of ownership or tenancy is required to cover

a direct impact on the market value thereof.”

the cost and long-term affordability of insurance premiums. Not to be

underestimated, say financial advisers, is the risk protection by way of

Alternative means of insurance cover, similar to

sufficient liquidity of the investments of insurers and bankers to ensure

residential ownership, is available on commercial

claims are honoured in all market conditions. This is illustrated by large

property investments. Comprehensive cover through

institutions that, as owner-occupiers in prime city locations, protect valuable

nonbanking industry leaders, such as Santam, is a popular

investments by countering risk with optimum income from their operations

option for many established property owners, provided the

as landlords. One example is Old Mutual and FirstRand, who last year

financiers are assured of the protection of unpaid assets.

spent R1.6-billion to develop First Rand’s 32-floor headquarters, Portside – and now own Cape Town’s tallest building and the first skyscraper to

Whether banks automatically become property insurers is a matter

be built in the CBD in 21 years. This landmark investment was made

of choice. Says Kevin Roman, chief operating officer of Pareto, “The

in a high-demand area where undeveloped land and A-grade office

appointment of a property insurer is the choice of the owners and does

space is expected to produce long-term income growth. The cost of risk

not necessarily lie with banks.” He says public liability forms a big part

management and the housing of a massive staff complement are shared by

of comprehensive insurance cover, where landlords are responsible for

three FirstRand Bank group divisions, namely FNB, RMB and Wesbank.

the safety of building occupants around large equipment installations,

00646 BETTERLIFE DREAMS LOTTERY PROPERTY PROFESSIONAL - EARPIECES V5 RP.indd2015/02/0 3

such as light fittings and escalators in retail centres. Retail banks that extend a lending hand to smallbusiness operators and entrepreneurs who aspire to property ownership, aim to reduce risk on assets of all sizes and values on their loan books. As with home loans, retail banks optimise the win-win potential through cross-banking functions where borrowers have the option to utilise corporate finance that extends to building insurance.

Roman says all tenants are covered in terms of overall

“THE APPOINTMENT OF A PROPERTY INSURER IS THE CHOICE OF THE OWNERS”

“Obviously where properties are bonded to a financial

Kevin Roman

institution, the loss of a property and subsequent loss of income would be even more dire, since the bank

building insurance according to lease agreements with landlords but are responsible for covering their own insurance of individual fittings and furnishings in offices and retail centres. Insurance companies conduct regular compliance surveys, with a focus on areas exposed to greater liability such as fire, spillages and leaks that have to be cleared according to safety and security requirements of specific industry bodies. Lease agreements cover major risk issues, such as electrical installations,

would have lost its security (other than the remaining land value) and

fire hazards and equipment, gas insulation, leakages, air conditioners,

would insist upon immediate repayment of the loan,” says Anderson.

staircases, parking, underground basements and storage.

In order to secure its position, a bank will insist upon insuring

“As property owners and landlords, we do our best to ensure

the property for the replacement value thereof and on its interest

occupant safety, but things happen in public spaces and

being noted in the policy by the insurance company. This will

leaseholders and managers have to create a strong awareness

enable the client to rebuild the building – thereby securing its

of any risks, to ensure positive customer experiences.”

source of income – and protect its position with the bank.

Added specifications to comprehensive cover allow for industry-specific

As the open-market value of fixed property changes, he says, so does

requirements and general loss of income, including business interruption,

the replacement value, as building costs and related professional

crime, loss of rental income, legal compensation and damages.

fees continually escalate. It is imperative that the client reviews the insurance value yearly to keep track of rising building costs.

Newcomers to commercial ownership are assured by industry leaders that the protection of asset values and occupant safety through

“The open-market value (the price for which the property can be sold in

comprehensive insurance backed by strong underwriters reduces risk

the open market at a certain point) and replacement value (the cost of

while adding market proficiency and potential business growth.

replacing the property according to its original specifications) are often quite different from each other. The area in which the property is located can obviously be one of the causes of these two values being far apart. The

BY ANNA-MARIE SMITH

PENNY-WISE

AND POUND-FOOLISH It may be slightly more difficult to budget commission-based earnings, but it’s not impossible.

In a perfect world, those who earn commission would write their

when nothing seems to go right, and deals either fall through (usually

own pay cheques. However, the world is far from perfect, and those

at the last possible moment) or good, solid buyers are rare and no one

who earn a percentage of what they sell often fall on hard times

is buying.

when their performance levels drop or the market for their particular product cools.

It may be fair to say that while agents are the experts when it comes to lecturing people on the importance of saving for a deposit, or the

Estate agents can, and very often do, earn very large sums of money

importance of owning an investment property, they generally don’t

– particularly when the going is good and property is in high demand.

practise what they preach and aren’t in the habit of putting something

Unfortunately, as most of you reading this are aware, there are times

aside for when sales slow to a trickle.

Page 31: CA S H F L OW M A N AG EM EN T

The sad part about all of this is that agents don’t function properly when

Now draw up a monthly budget for the year, and remember to factor

they are broke. Firstly they come across as desperate – a somewhat

in expenses that fall due at various times of the year, such as licensing

unfortunate attitude, given that the average buyer can smell desperation

your car. You should then estimate the income you realistically expect to

at 50 paces. Secondly, in an effort to save on petrol costs, they tend to

earn from month to month. Subtract your expenses from your anticipated

compromise their buyers by showing them homes close to the office even

income, thus determining which months are going to be more financially

though they know something more suitable is available further away.

draining and when you may need to either delve into your savings or cut back on your spending.

Being a successful agent has never just been about owning a car and a cellphone. Good agents have backups in place and run their own

It’s very important to remain realistic about your earning potential, and as

well-oiled real estate enterprise, albeit sometimes under the umbrella

such you should create three different scenarios of what you could bring in

of one of the larger franchises. They budget monthly and understand

if the odd sale falls through: an optimistic estimate, a moderate projection

that essential business costs have to come first if they want to continue making money. They drive wellmaintained cars, tend to have cellphone contracts as opposed to pay-as-you-go services, have a reliable internet connection at home and own a wardrobe of smart business clothes. Their less fortunate counterparts live from day to day. They don’t plan ahead, and they tend to make hay while the sun shines when commissions are paid out. They regard themselves as “successful” if a sale goes through and promptly take their foot off the gas while they spend what they have earned. The problem is that inconsistency has dire financial consequences, and these agents often resort to bridging finance or revolving credit when things turn bad. Bad habits tend to be the hardest to break, but there are ways for agents to take back control of their financial affairs, irrespective of how frequently – or infrequently – they conclude sales.

and a conservative estimate.

SUCCESSFUL AGENTS STICK TO THEIR BUDGETS REGARDLESS OF HOW MUCH COMMISSION IS EARNED DURING THE ALLOTTED PERIOD. FOR SOME REASON, MANY AGENTS GAMBLE THEIR CURRENT EARNINGS ON FUTURE POTENTIAL SALES, ASSUMING THAT THEY WILL BUILD MOMENTUM AND THAT PAST SUCCESS IS A PREDICTOR OF FUTURE SUCCESS

DRAW UP A BUDGET It’s not easy to budget when earning a commission income, but it’s not impossible either.

STICK TO A BUDGET Experts have been telling agents for years about the dangers of spending commission before it is in the bank. Of course, it’s disappointing when a sale falls through, particularly when this happens shortly before the property is registered. However, agents often max out their credit cards or opt for bridging finance because they assume that the sale is a done deal and that the commission is guaranteed. Unfortunately, the fallout from this can be catastrophic and generally leads to a major debt load. Bridging finance and credit cards have their place, of course, but they should never be regarded as an extension of an agent’s earnings and should only be used as a last resort. Successful agents stick to their budgets regardless of how much commission is earned during the allotted period. For some reason, many agents gamble their current earnings on future potential sales, assuming that they will build momentum and that past success is a predictor of future success. The fact of the matter is that an agent is only as good as their last sale. Savings are always going to be an estate agent’s

secret weapon and they should make every attempt to squirrel away a percentage of each month’s earnings.

Collect all the previous year’s financial documents so that you can determine exactly where your money is going. Ascertain what your

The experts maintain that as much as 20% of what we earn should be put

monthly expenses are, including taxes and bank charges. Make a list

away for that proverbial rainy day and for when we retire.

of all fixed expenses, including bond or rent repayments, insurances

Agents can and do earn a great deal of money selling property. The ones

and car instalments. Then make a note of expenses that fluctuate

who manage to hang on to it can generally retire comfortably, while those

from month to month, such as groceries, petrol costs, telephone

who don’t are forever on the treadmill, waiting for of the next sale.

bills and utilities. Next, list all expenses that can either be cut back on or forgone altogether, including eating out, entertainment and excessive clothing purchases.

BY LEA JACOBS

Page 32: M A R K E T S H A R E

PROPERTY FINANCE IN SOUTH AFRICA Property Professional finds out what the composition of South Africa’s residential property stock is in terms of value and volume, and what types of dwellings the people of South Africa are living in

SOUTH AFRICA’S RESIDENTIAL PROPERTY STOCK VALUE

LIVING CONDITIONS IN SOUTH AFRICA

VOLUME FORMAL

77.7%

GAUTENG

33.3% 37.2% WESTERN CAPE

INFORMAL

17.9% 24.9%

13.6%

KWAZULU-NATAL

OTHER

13.2% 12.7%

0.8%

EASTERN CAPE

TRADITIONAL

7.9%

9.7% 6.3% FREE STATE

7.6% 3.8% MPUMALANGA

4.9% 3.5%

NORTH WEST

4.5% 3.8% LIMPOPO

3.0% 2.0% NORTHEN CAPE

2.8% 1.4%

(Source: Lightstone www.lightstone.co.za)

(Source: Statistics South Africa www.beta2.statssa.gov.za)

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LOOKING TO AFRICA Should you be looking to expand into Africa in 2015? We ask the expertsâ&#x20AC;Ś

Page 35: I N V ES T I N G I N A F R I CA

Expansion is a necessary part of any business, and in the property industry

“Most countries welcome foreign investment, especially for the creation of

one that is vital to ensure continued profitability. Within the continent of

new malls and commercial space. One-billion dollars has been raised in

Africa there are some countries that offer exceptional benefits for expansion

capital over the past two years to build or buy new property assets across

and profitability – you just have to know where and how to go about finding

the continent.

the perfect new market for your company. We asked the top property companies in South Africa to give us their African hot spots for investment

“From a size and established-market point of view, the ‘low-hanging

in 2015.

fruit’ countries – including Zambia, Mauritius, Botswana, Namibia

WHERE DO THE EXPERTS SEE INVESTMENT OPPORTUNITIES IN 2015?

and Mozambique – have already been picked by the major South African brands.

JP Farinha, CEO of Property24, said, “The African market has seen

“From a product and volume point of view, Kenya and Ghana appear

major breakthroughs and growth in its mobile technology industry, retail

to offer great scope. Africa is seen as the new frontier in real estate.

trades, precious metals and oil, as well as the real estate markets, to

The prevailing slowing retail conditions and softening rand in South Africa

mention a few. In terms of increasing values of property, there are many

along with the burgeoning demographics north of the Limpopo are luring

attractive markets. A number of businesses have seen positive expansion

South African investors and developers north. The Holy Grail is to provide

opportunities, including Property24, which recently successfully expanded

South African-style retail in Africa, with projects touted as achieving yields

its reach into Kenya and Nigeria. Investors generally look towards Kenya

of 10% to 15%, paid in US dollars. The malls tend to be 15 000m2 to

and Nigeria as the largest economies in sub-Saharan Africa. Based on

25 000m2 open malls.

research being done and the growth and development of technology, further opportunities for the property industry are constantly presenting themselves,

“The residential property demand in Africa is seen as strong but facing a

making for exciting business development across the continent.”

major challenge in providing appropriate mortgage finance. Particularly hot markets are in Ghana, Tanzania and Kenya, where multifamily complexes

Andrew Golding, CE of Pam Golding Properties (PGP), said, “The continent

have proven popular. The demand for residential property is from three

of Africa is an important area for us and we are already very active in

main groups, namely expatriates, local affluent and investors.”

Zambia, Zimbabwe, Swaziland, Botswana, Namibia, Mozambique, Kenya and, more recently, Uganda, as well as the Indian Ocean islands of

Anthony McGuire, MD of Seeff Swaziland said, “While Swaziland is one

Mauritius and Seychelles.

of the smallest countries in Africa, it is expected to attract foreign investment from all over the African continent, and there is considerable interest from

“Significantly, Africa is forecast to register robust economic growth rates

potential investors in neighbouring countries looking to invest in Swaziland.

during the decade ahead, accompanied by some of the healthiest growth rates in individual wealth. For example, the number of dollar millionaires

“Our success with commercial sales demonstrates the incredible appetite

in Nigeria, Kenya and Angola is expected to double during this period.

for this type of property within Swaziland, even when compared to larger

However, in looking at opportunities in Africa, we are not necessarily

economies in Africa. The need for commercial property is largely fuelled

focusing on high-value properties but rather on partnering with well-

by nationwide infrastructural developments, good returns and improved

established local operators who have existing property opportunities

confidence in the kingdom as a whole.

that they wish to bring to market and/or want to capitalise on the PGP brand and its intellectual property and experience to establish a

“In comparison with South Africa, an average residential property in

real estate business.”

Swaziland is priced significantly higher even when compared with exclusive suburbs such as Sandton and areas in Randburg. This is mainly due to the

Kura Chihota, managing director of Leapfrog Commercial said, “Africa, like

absence of a competitive sectional title market that can offer an alternative.

the Western Cape, isn’t one homogeneous marketplace. There are new residential developments hitting the market in East Africa, especially in

“Many sellers in the top-end market also attach unrealistic price tags to their

Mombasa, Nairobi and Dar es Salaam. Accra and Tema in Ghana in West

homes, prices which they occasionally manage to fetch when we have an

Africa are experiencing an oil-discovery-led boom. From a service provision

influx of buyers who are not very specific about their property needs, have

point of view, many local partners would love to partner with experienced

low price sensitivity and are all about location. There is a segment of the

South African marketers, but the licencing and registration elements are

market in Swaziland which consists mainly of foreigners, embassies and

sometimes insurmountable for foreigners looking to participate in those

professionals such as doctors and entrepreneurs who can afford to buy

markets; for example, Zimbabwe sets aside 100% of the provision of real

properties at a premium price, creating the effect where a select few sellers

estate services for locals.

capitalise massively and make tremendous capital gains.

Page 36: I N V ES T I N G I N A F R I CA

“Exponential growth and increased property prices are particularly evident

So how can one forestall these challenges before they become an issue?

in the Ezulwini Valley where we have limited supply, relatively high demand

Chihota recommends partnering with one of the Big Four accounting

and willing cash buyers. In turn this has resulted in new opportunities in

firms with multinational operations to keep up with legalities and financial

other areas for which demand has been somewhat lacking. Mukela and

differences between countries in the rest of Africa and South Africa.

Umdoni residential estates, for instance, have seen increased demand of late as other areas of Ezulwini are priced out of middle class markets.”

Another way you could do this would be to partner with a local company on the ground. Farinha said, “Building partnerships with local property

WHAT ARE SOME OF THE CHALLENGES?

businesses from another country can be a positive step as one can learn

Africa is not what some people imagine it to be, and there may well be

a great deal about the local business strategy, core values, business

obstacles or challenges when you are looking to tap into the property

framework and execution of plans to help provide a better platform for the

market in countries where the laws, culture and language differ vastly to our

business. In fact, Africa has a growing and inspiring population and there

own. So what are some of the challenges you could face and how can you

is great opportunity for local and foreign businesses to partner and venture

pre-empt them before they create an obstacle?

into the rapidly growing market. There are many examples of this kind of interaction, and the driving motivation is that as one assists in growing these

According to Farinha, some of the challenges you could be faced with when

markets, one also enhances one’s brand and business. Of course, there are

expanding operations into Africa include its various cultures, languages

benefits and drawbacks to partnering with a local business as well as with

and financial regulations, which could all differ vastly to

going at it alone, and ensuring this decision fits with the

what is the norm in South Africa. Property transactions

strategy and capabilities of one’s business is key.”

and the ability of the population to buy housing are a different matter. High interest rates and low-income-level demographics show that it is tough for the majority of the population to access the property market. When you marry the inability of the population to access the property market with informal and unregulated property agents, it makes the market that much more challenging than a market that you already understand and can navigate with ease. Applying the strategies that have been successful in one

“FINDING GOOD PARTNERS WITH LOCAL EXPERIENCE AND KNOWLEDGE IS A FUNDAMENTAL PREREQUISITE” Andrew Golding

country to another country will often not achieve the best results; therefore, it’s vital that sufficient research is done

Golding agrees, and takes this one step further: “Finding good partners with local experience and knowledge is a fundamental prerequisite; however, once you have partnered well, the establishment and conduct of the business become so much simpler. This is probably the skill set we have tried to develop the most: determining what constitutes a good partner and a sound long-term relationship. We also work hard to enhance established relationships as they are geographically situated at considerable distance, as having a mutual understanding and sound relationship is key to a solid African business. Understanding the individual nuances

prior to launching an expansion project. This means that one is required to

of each property market is a further requirement. Depending on the size

revise the business models in a consumer-centric manner by understanding

of the area, this can be a fairly lengthy process. For example, Nigeria is

not only what is happening on the ground but also how practices differ

about three times the size of South Africa and has a variety of regional

between markets.

nuances and intricacies. This makes it important to take the time to research the market to establish where the competitive advantages lie and where the

One way of doing this is with in-depth research conducted on the ground,

brand can fit in and make a difference.”

through surveys, and understanding how the property industry in the country you are interested in works, from how homes are marketed and to

Despite the challenges and potential pitfalls for investors who don’t take

whom, the prices and factors that make one house sell over another house,

the time to properly understand the market they wish to enter, there are

and understanding who the target market is and what their needs are.

investment opportunities available in Africa for property companies looking

Understanding the culture and legal practice will also assist you in deciding

to expand. Many South African property companies have already taken

whether investment is something you should consider.

the plunge and are reaping the benefits of being the first to do so. You have heard from the professionals about the key spots for expansion into Africa

Another challenge that could arise once you have started the expansion

in 2015, and with the right local business partners and business plan there

process into a new country is the challenge of maintaining standards. Real

is no reason why you too shouldn’t reap the rewards.

estate is, as Chihota puts it, “a service business, and trading and standard operating procedures need to be imparted and policed to ensure that the same high standards of regular and predictable service are maintained.

BY ANGELIQUE REDMOND

Viewing real estate from another angle “It’s not sometimes about the people, it’s always about the people” This is the foundation of our attitude at Leapfrog Property Group and to make sure we attract and keep the right people, we offer our agents and franchisees the following services and benefits: Ÿ

Wealth creation though share ownership

Recruitment incentives

Ongoing inhouse training and development

Customised property marketing programme

Cutting edge technology

National referral system with over 50 offices

Ongoing franchisee support

Franchise opportunities available in prime areas

To find out more about franchise opportunities or to join South Africa's only truly agent focused property group, where actions speak louder than words, contact:

Move on Move up

To find out more contact: Bruce Swain 021 671 4880 bruce.swain@leapfrog.co.za www.leapfrog.co.za

Page 38: P RO P ERT Y P RO F ES S I O N A L N EW AG EN T S O N T H E B L O C K

PROPERTY PROFESSIONAL

NEW AGENTS ON THE BLOCK

developing new opportunities and being able to work as hard as I can

JUSTIN MULLER

and as hard as I want. I firmly believe that we get out what we put in.

R E / M AX P RO P ERT Y A S S O C I AT ES

but can very easily turn negative. I am young and my intentions are good,

Dealing with people can be a challenge – it’s a positive aspect of the work so I find working within such a large company, with attention to detail on a personal level, very rewarding. There is always someone to help with technical, legal and client liaison issues.

WHY DID YOU DECIDE TO PURSUE A CAREER IN PROPERTY? I decided to pursue a career in property as this career gives one directly

WHAT CHARACTERISTICS, IN YOUR OPINION, MAKE FOR A GREAT ESTATE AGENT/

proportional results, effort to reward. I also liked the idea of essentially

BROKER AND WHY?

working in my own business. My grandfather has always invested in

To be a broker you have to be very versatile, you have to be honest,

property and my mother used to be in the industry, so I was always

outspoken and outgoing and you have to be easy to relate to and able to

surrounded by the property market.

break the ice in many situations.

WHAT ARE THE MOST ENJOYABLE AND THE MOST CHALLENGING ASPECTS

WHAT ARE SOME OF YOUR CAREER GOALS?

OF THE JOB?

My goals are to be the best at what I do – there are no limits in this

The most enjoyable aspects are constantly meeting new people,

industry. I want to create wealth for myself and for my clients.

CHRISTA TAGG S EEF F J O H A N N ES B U RG SOU TH

bonus is that the hours are flexible and I’m not office-bound. Although I really enjoy the pressure and challenges that come with the territory, our main obstacle remains securing bonds for clients. WHAT CHARACTERISTICS, IN YOUR OPINION, MAKE FOR A GREAT ESTATE AGENT/ BROKER AND WHY?

WHY DID YOU DECIDE TO PURSUE A CAREER IN PROPERTY?

A good estate agent, in my opinion, must be able to communicate and

Having a passion for people and a keen interest in the property market

relate to people and have a passion for people. Business acumen, a strong

made this a natural choice for me. Buying property remains one of the

sense of responsibility and attention to detail also go a long way. It is

biggest transactions one can make in a lifetime. I strive to make buying

important that your clients know that you have their best interests at heart

and selling property a pleasant experience by focusing on service

and that they feel comfortable to entrust you with their property.

excellence and going the extra mile. WHAT ARE SOME OF YOUR CAREER GOALS? WHAT ARE THE MOST ENJOYABLE AND THE MOST CHALLENGING ASPECTS OF THE

My career goals are to be an achiever agent with a client base built

JOB?

from referrals. I want to be known as an agent who can be trusted and

I enjoy the diversity of the job – no two days are ever the same. A further

respected.

Page 39: P RO P ERT Y P RO F ES S I O N A L N EW AG EN T S O N T H E B L O C K

WHAT ARE THE MOST ENJOYABLE AND THE MOST CHALLENGING ASPECTS OF THE JOB? I enjoy chasing new listings and feel like I have accomplished something when I finally sign a mandate on a listing. Being the first agent to list the property is, for me, the most challenging and the most rewarding.

SARIE HAASBROEK EN G EL & VÖ LK ER S H A RT B EES P O O RT DA M

WHAT CHARACTERISTICS, IN YOUR OPINION, MAKE FOR A GREAT ESTATE AGENT/ BROKER AND WHY? You need confidence, honesty and perseverance. Without perseverance you won’t be able to handle the highs and lows; without honesty you will lose clients; and without confidence you won’t survive.

WHY DID YOU DECIDE TO PURSUE A CAREER IN PROPERTY? As far back as I can remember, I have always been interested in

WHAT ARE SOME OF YOUR CAREER GOALS?

properties – following price history, viewing properties and generally

To increase my sales record, to become the top agent in Hartbeespoort

being interested in the market activity – wherever I lived.

and to be known as the agent who keeps her promises and is transparent in her dealings with clients.

property to the market at a competitive price. The most challenging aspects are managing sellers’ expectations in a buoyant market and

ASHLEY LARTER S EEF F H O U T BAY A N D LL A N D U D N O

encouraging buyers to commit in a flat market. WHAT CHARACTERISTICS, IN YOUR OPINION, MAKE FOR A GREAT ESTATE AGENT/ BROKER AND WHY? The ability to quickly and effectively create trusting relationships with clients. An agent must be eloquent, must be able to close deals and must have strong negotiating skills. An ability to process market information

WHY DID YOU DECIDE TO PURSUE A CAREER IN PROPERTY?

simply and to have a thorough knowledge of their area is also vital.

I thoroughly enjoy and love interacting with people. I also enjoy liaising with clients and negotiating. And of course not being desk-bound all the

WHAT ARE SOME OF YOUR CAREER GOALS?

time is a bonus.

I would like to create clients for life, and in so doing I would like also to be the agent of choice for at least 50 clients by the end of 2016. I would

WHAT ARE THE MOST ENJOYABLE AND THE MOST CHALLENGING ASPECTS OF THE JOB?

like to help establish 40% market share in both Hout Bay and Llandudno

The most enjoyable aspect of my job is being able to present a stunning

for Seeff Properties and to sell between 12 and 15 homes annually.

NUMBERS TO KNOW

The six-million formal residential properties in South Africa

R4.2-TRILLION

are valued at R4.2-trillion, a couple of billion higher than 2013 GDP figure of $350.6-billion and also higher than most GDP forecasts for 2014. The vast majority of this value lies in Gauteng and the Western Cape. (Source: Lightstone)

Page 40: P RO P ERT Y P RO F ES S I O N A L I N S I G H T

THE VALUE PROPOSITIONS OF AN ESTATE AGENT Johan H Vermeulen brings property professionals a two-part series on the importance of and how to create a value proposition as an estate agent.

“Business will never be the same.” It seems this is the new slogan for present

that you have over them. The major advantage should be a statement

and future CEOs. The question is, what can we expect to happen in the

describing what distinguishes you from your competitors, but it must be

business environment?

compelling enough to convert prospects not only into customers but repeat customers.

In an attempt to answer the question, Nadler and Tushman (1999) identified

the most important key characteristics of business success in pursuit of

VALUE PROPOSITION

competitive advantage in an uncertain world. These key characteristics of

Robert Kaplan and David Norton coined the term ‘value propositions’

the new business environment are:

in their ground-breaking work, The Balanced Scorecard (1996). Value propositions form the central theme in the customer perspective of the

• • •

Global competition, industry deregulation and the abundance of

balanced scorecard. The customer perspective enables companies to

capital

align their core customer outcome measures, namely satisfaction, loyalty,

The conducting of business unconstrained by the traditional limitations

retention, acquisition and profitability, to targeted customers and market

of time or space

segments. The value propositions represent the drivers, the lead indicators,

The movement from a manufacturing environment to an environment of

for the core customer outcome measures.

service support and distribution •

A shift to knowledge workers, a new class of affluent, educated and

The value proposition statement summarises why a customer should buy a

mobile people who view themselves as free agents

product or use a service. It should convince a potential customer that one

•

A demand for continuous innovation

particular product or service will add more value or better solve a problem

•

The fragmentation of markets

than other similar offerings.

•

The ability of technology to make everything faster, easier and cheaper. Companies use this statement to target customers who will benefit most

The crucial questions are “Can I as a businessperson ensure profitability

from using the company’s products, and this helps maintain an economic

in these changing times?” and “What can I do to ensure sales through my

advantage. The ideal value proposition is concise and appeals to the

value contribution?”

customer’s strongest decision-making drivers. Companies pay a high price

THE IMPORTANCE OF MEASUREMENT IN BUSINESS

when customers lose sight of the company’s value proposition.

To answer the question of profitability through your own value contribution,

Regardless of the size of your business or the type of industry you are in,

it is important to look at the broader picture of measurement in business and

your company as well as individuals should have a value proposition.

how it contributes to profitability.

According to Wendy Maynard (2010), a strong value proposition does the following:

For some time there has been considerable interest in performance measurement. Adages such as “What gets measured gets done” and

•

creates interest, so that your customers ask questions and want to learn

“You get what you measure” suggest that implementing an appropriate

more – your value proposition opens the door so that someone might

performance measurement system will ensure that actions are aligned to the

be willing to meet with you instead of blowing you off when you call or

strategies and objectives of the organisation.

mail them for the first time •

Typical performance measurement helps businesses in setting business goals

differentiates you from your competitors and creates a strong differential between you and your competitors

and then providing feedback to managers on progress towards those goals.

•

increases the quantity and quality of your sales leads and makes

The important concept here is “value”. The best way to distinguish your

•

wins your business greater market share in your targeted segments

business from that of your competitors is to identify the major advantage

•

aligns your business operations more closely to customer needs

conversion to a customer much easier

Page 41: P RO P ERT Y P RO F ES S I O N A L I N S I G H T

•

focuses on your customers’ points of view

•

include demonstrated results that will catch the attention of decision-

•

Can your own persona/character be the distinguishable factor between you and others?

makers – results such as increased revenues, decreased costs, improved operational efficiency and faster times.

4 DISTILL THE CUSTOMER-ORIENTED PROPOSITION

CREATING A VALUE PROPOSITION

The final step is to pull it all together and answer, in two or three

A value proposition is a short statement that clearly communicates the

sentences, “Why should I buy this specific product or idea?” or “Why

benefits that your potential client gets by using your product, service or

should I stay with this provider?”

idea. It “boils down” all the complexity of your sales pitch into something that your client can easily grasp and remember.

Try writing from the customer’s viewpoint, by completing the following statements:

It needs to be very specific: simply describing the features or capabilities

•

of your offer is not enough. Your value proposition must focus closely on

“I want to buy this product or idea, or stay with this provider, because it will...”

what your customer really wants and values. Your customer wants to solve

•

“The things I value most about the offer are...”

problems, to improve on existing solutions, to have a better life, to build a

•

“It is better than competing products or ideas because...”

better business or do more, better, faster and so on.

•

“I should stay with this provider because he/she differs from others because…”

Creating a value proposition is a useful marketing technique that has wider application than product marketing. Whatever you are “selling” and to whom, a value proposition is a useful if not essential tool. Whether your

5 PULL IT ALL TOGETHER

“customers” are external customers, employees, co-workers or even your

Now, turn your “customer’s answer” from step 4 into a value

family, the idea is to help them see the specific value your offer brings to

proposition statement.

them. By doing so, you will grab their attention in such a way that they know, “Yes, that’s right for me.” According to the Mind Tools team in the United Kingdom, your value proposition can be created, step-by-step, by answering a series of questions. Once you answer these, you have the ingredients to create a value proposition.

1 KNOW YOUR BUYER OR SELLER

FURTHER READING •

Kaplan, RS & Norton, DP (1996). The Balanced

Scorecard. Boston: Harvard Business School Press Thinking from the perspective of your buyer/seller, ask the following: •

Who is he or she? What does the potential buyer/seller need?

•

What problems does the buyer/seller need to solve?

•

What does your buyer/seller value?

2 KNOW YOUR OWN PRODUCT, SERVICE OR SKILL SET

•

Maynard, Wendy (2010). How To Write a Value

Proposition for your Company •

Nadler, DA & Tushman, ML (1999). Strategic Imperatives

and Core Competencies for the 21st Century. Organizational Dynamics

From the buyer’s or seller’s viewpoint: •

How does your product, service or idea solve the problem or

•

The Mind Tools Team: How to Create a Value Proposition.

offer improvement?

Mind Tools Ltd, 145–157 St John Street, London,

•

What value and hard results does it offer the buyer/seller?

EC1V 4PY. United Kingdom

•

What does your own skill set bring to the table?

3 KNOW YOUR COMPETITORS Keep on thinking from the perspective of your buyer/seller, and ask: •

How does your product, service or idea create more value than competing ones?

Look out for the second instalment of this series in the May/June issue.

Page 42: F I N A N C E A N D F I G U R ES

HOW DOES RENTAL PROPERTY MEASURE UP? Property Professional gathered information from PayProp, a processor of rental payments for the residential letting industry, to provide some insight into various statistics, by comparing data from the

THIRD QUARTER (JULY–SEPTEMBER) RENTAL INDEX 2014

AVERAGE AGE OF PROPERTY OWNERS AND TENANTS 57 WESTERN CAPE

EASTERN CAPE + NORTHERN CAPE

51.5

FREE STATE

52.4

49.6

50 49

48.2

LIMPOPO

NORTH WEST

50.8

KWAZULU-NATAL

48 GAUTENG

MPUMALANGA

47.3

47.0

46 WESTERN CAPE

FREE STATE + NORTH WEST

42.9

NE OW

EASTERN CAPE + KWAZULU-NATAL

41.9

42 41 NORTHEN CAPE

40 39 38

44.7

MPUMALANGA

39.1

41.1 GAUTENG

(Source: PayProp Rental Index Q3 2014)

39.3

LIMPOPO

39.6

Page 43: F I N A N C E A N D F I G U R ES

% RENTAL GROWTH RATE 2014: Q1

AVERAGE RENTAL PRICE GAUTENG

EASTERN CAPE

10.7 9.1

7.2

FREE STATE

5.7

3.7

R6 690 KWAZULU-NATAL

R6 284 MPUMALANGA

GAUTENG

10.8 8.4

8.1

KWAZULUNATAL

7.2

6.0

7.2

R6 833

NORTHERN CAPE LIMPOPO

9.9

1.1

-3.3

MPUMALANGA

7.2

2.5

3.6

NORTH WEST

7.2

5.5

4.1

NORTHEN CAPE

12.6 13.1 11.6

WESTERN CAPE

8.9

9.5

R6 548 FREE STATE

R4 725 NORTH WEST

R4 440

11.5 WESTERN CAPE EASTERN CAPE

AVERAGE RENTAL GROWTH RATE Q3 2014

7.5%

R4 834

LIMPOPO

R6 522

R6 446

Page 44: P RO P ERT Y P RO F ES S I O N A L T O P P ER F O R M I N G AG EN T S

PROPERTY PROFESSIONAL

TOP PERFORMING AGENTS your area. PropStats is a powerful tool that provides us with most of this information and assists in price counselling. A successful brand and your belief in yourself as its ambassador are the most important tools. DO YOU REMEMBER THE FIRST PROPERTY YOU SOLD? PLEASE TELL US ABOUT IT. The first property I sold was in 2003, after working for a large legal firm for

ROCHELLE SERMAN S EEF F CA M P S BAY

10 years. The buyer happened to be an attorney and he was very specific about what he wanted. He was irritated by agents who had not listened to his brief and taken him to view unsuitable properties. So I listened very carefully, asked pertinent questions and stuck exactly to his brief. I took him to view two properties that day, and on the following day he called me to

WHAT ARE YOUR TOP THREE SECRETS TO SUCCESS?

arrange a meeting to put in an offer.

Total honesty and integrity with buyers and sellers, to earn their trust. Listen very carefully to their needs and make sure that you service these needs

WHAT ADVICE WOULD YOU GIVE TO NEW KIDS ON THE BLOCK ABOUT MAKING A SUCCESS

totally, both during and after the sale. Leave no stone unturned.

IN THEIR CAREER IN PROPERTY? At all times, show total commitment, passion and, above all, honesty and

WHAT IS THE ONE THING YOU WISH SOMEONE HAD TAUGHT YOU OR TOLD YOU WHEN

integrity. Be prepared to make personal sacrifices – this is not a half-day

YOU FIRST STARTED OUT IN PROPERTY AND WHY?

job. Follow up on every opportunity immediately, otherwise or you will lose

How difficult this job is. It is not for the faint-hearted.

out. Treat all sales with the same commitment, whether it’s a R2-million or a R20-million sale. Ensure the confidentiality of every buyer and seller. Never

WHAT IS THE MOST VITAL BUSINESS TOOL THAT ESTATE AGENTS SHOULD HAVE AT THEIR

be afraid to say, “I don’t know the answer, but will find out and get back

DISPOSAL IN TODAY’S MARKET?

to you.” Never, ever show desperation. Go the extra mile – it will pay off.

You must have extensive knowledge of all properties on the market in

And don’t spend your commission before it’s in the bank.

WHAT IS THE MOST VITAL BUSINESS TOOL THAT ESTATE AGENTS SHOULD HAVE AT THEIR DISPOSAL IN TODAY’S MARKET AND WHY?

ANNIE VAN DEN BERG R E / M AX W I LD LI F E P RO P ERT I ES H O ED S P R U I T

Besides the internet, systems and great staff, the strongest business tool in today’s market is knowledge of the product and the market. DO YOU REMEMBER THE FIRST PROPERTY YOU SOLD? PLEASE TELL US ABOUT IT. It was a stand in a wildlife estate. I was the sales team’s assistant and this couple came in and asked for a stand the furthest away from the gate and from people. The agents were out, so I loaded them up onto the game

WHAT ARE YOUR TOP THREE SECRETS TO SUCCESS?

viewer and off we went. On our return they asked me for the paperwork.

Passion, consistency and the ability to listen.

I was then asked where they must sign and took a seat. I started shaking and they had to use their own pen to complete the agreement. From that

WHAT IS THE ONE THING YOU WISH SOMEONE HAD TAUGHT YOU OR TOLD

moment forward I just knew that this is what I really love doing.

YOU WHEN YOU FIRST STARTED OUT IN PROPERTY AND WHY? That buyers never tell you exactly what they want to spend. It’s important

WHAT ADVICE WOULD YOU GIVE TO NEW KIDS ON THE BLOCK ABOUT

to listen to what they want to buy, because if you have a house that fits the

MAKING A SUCCESS IN THEIR CAREER IN PROPERTY?

description, then the budget is no longer a problem.

Have patience, and use your ears more than your mouth.

Page 45: P RO P ERT Y P RO F ES S I O N A L T O P P ER F O R M I N G AG EN T S

WHAT IS THE MOST VITAL BUSINESS TOOL THAT ESTATE AGENTS SHOULD HAVE AT THEIR DISPOSAL IN TODAY’S MARKET AND WHY? A tailor-made marketing presentation, a visual toolbox that should be

KRYSTAL KOLNIK JAW I TZ P RO P ERT I ES S O U T H P EN I N S U L A ( N O O R D H O EK / FA L S E BAY )

with you at all times. You never know when you might be called into an unexpected listing appointment. DO YOU REMEMBER THE FIRST PROPERTY YOU SOLD? PLEASE TELL US ABOUT IT. The first sole mandate came about as a result of extensive door knocking. When a kind homeowner finally agreed to my selling her home, I was so unprepared and caught off guard that I didn’t know what to do next. Clearly I didn’t get to sell that house – but my first sale was

WHAT ARE YOUR TOP THREE SECRETS TO SUCCESS?

a R2.5-million luxury apartment in Fish Hoek.

Honesty is paramount in building trust with clients. Integrity. Always be aware of clients’ needs. Money follows from a job well done. Efficiency.

WHAT ADVICE WOULD YOU GIVE TO NEW KIDS ON THE BLOCK ON MAKING A

Keep in constant contact with clients by responding to emails and

SUCCESS OF THEIR CAREER IN PROPERTY?

enquiries as soon as possible, and deliver what was promised.

Property is a rather intimidating industry, so do all the basics such as door knocking and telephone canvassing, and learn how the industry

WHAT IS THE ONE THING YOU WISH SOMEONE HAD TAUGHT YOU OR TOLD YOU

works. Find a mentor who is prepared to take you to valuations, show

WHEN YOU FIRST STARTED OUT IN PROPERTY AND WHY?

houses and viewing appointments. And visualise your success every day.

I was fortunate in having a very efficient, highly experienced and amazing mentor. I shadowed her for a year and she taught me everything I know. She proved to be a master negotiator and incredibly thorough.

WHAT IS THE MOST VITAL BUSINESS TOOL THAT ESTATE AGENTS SHOULD HAVE AT THEIR DISPOSAL IN TODAY’S MARKET AND WHY? An iPad or a tablet. Information is power, and with the apps that are

KAZ THOMPSON PA M G O LD I N G P RO P ERT I ES D U R BA N N O RT H A N D L A LU C I A

available to agents today, you can have all the information you need right at your fingertips. DO YOU REMEMBER THE FIRST PROPERTY YOU SOLD? PLEASE TELL US ABOUT IT. The first house I sold was nearly 20 years ago, but then I left the industry for many years. The first house I sold when I joined the industry again was a duplex in Sunningdale. The delightful couple who bought it had retired

WHAT ARE YOUR TOP THREE SECRETS TO SUCCESS? I care! I genuinely care about my clients’ needs and about them as people, and this allows me to always work in their best interests. I am honest and ethical. This job is a marathon, not a 100m dash. My clients trust me and for that reason they are confident to recommend me to their friends, which results in a lot of word-of-mouth referrals and loyal clients.Work hard! It is all about going the extra mile. WHAT IS THE ONE THING YOU WISH SOMEONE HAD TAUGHT YOU OR TOLD YOU WHEN YOU FIRST STARTED OUT IN PROPERTY AND WHY? In this industry, you will have ups and downs and you will see all aspects of human nature at times. Stick to what you believe in, to who you are as a person and never ever compromise on these. Stay true to your values and principles.

and the husband was moving from Nelspruit, where he had been working for the last couple of years, and his was wife from the Eastern Cape. The day we viewed the unit it was pouring with rain, the wind was howling and the whole area had lost power. It was the first property they had seen and they bought it. WHAT ADVICE WOULD YOU GIVE TO NEW KIDS ON THE BLOCK ON MAKING A SUCCESS OF THEIR CAREER IN PROPERTY? Keep it personal! Personal contact, personal care. This job has far more to do with people than it does with houses.

Page 48: T E C H T O O LK I T

TECH TOOLKIT Yellow Pages SA app AVAILABLE FROM: free from the app store LOVE IT: we all know the print Yellow Pages and how useful they can be,

but who has the time to dig the giant thing out from wherever we put it and flip through all those pages? Well, problem solved â&#x20AC;&#x201C; the Yellow Pages app, an MTN App of the Year 2014 finalist, not only has all the contacts you could possibly need, but GPS navigation and maps too. NOT SO MUCH: there were a couple of bugs; however, they seem to have

been sorted out and the app is working as promised.

IN A NUTSHELL: it is the trusted Yellow Pages that everyone knows and

loves, combined with modern technology, available on your smart device for you to use wherever you are! *All prices are approximate.

Ryobi petrol generator AVAILABLE FROM: Makro stores (R3 499) LOVE IT: unfortunately, power outages are a reality in South Africa, and

a blackout can often last a number of hours. So what do you do? You need to keep living. The standard voltage for most suburban homes is about 240 volts, which means that you donâ&#x20AC;&#x2122;t need the most enormous generator to keep your home going. Great news, because they are not the cheapest accessory for the home. The Ryobi 2.5kVA petrol generator has a 12-litre tank and weighs just 40kg, so it wonâ&#x20AC;&#x2122;t take up your whole garage, and the power will be enough to keep you going. IN A NUTSHELL: investing in a generator could make the whole

experience far less harrowing. You might even make new friends in your neighbourhood, as you will be the only smarty-pants who has electricity during a power failure.

BTMobi AVAILABLE FROM: free from Comcorp Mortgage

Software

LOVE IT: designed specifically for estate agents and

mortgage origination consultants, this app takes the guess work out of property selling. BTMobi puts prequalification tools in your pocket on your smart device or on your desktop. It features affordability calculators, property reports and various credit checks. You can use the app to send your prequalified leads directly to your mortgage originator, and view progress reports in real time. IN A NUTSHELL: an application designed to save

Property24 Windows app AVA I L A B LE F RO M : free to download from the Windows Phone store L OV E I T: Microsoft and Property24 have teamed up to develop an app tailored to

Windows devices. The app is well designed, with easy to use maps, high-resolution

photographs and location-based searching to help you find the properties nearest to you. The app offers easy filtering, to ensure that property buyers can quickly access properties that meet their requirements, and gives you the option of contacting the estate agent directly from the app. You can even save and share your favourite properties with others. I N A N U T S H ELL : the whole point of these apps is to help make our lives a little

easier, and that is exactly what the Property24 Windows app does.

agents time and money.

Page 48: D EV EL O P M EN T U P DAT E

DEVELOPMENT UPDATE

ACCELERATED URBANISATION IN AFRICA MEANS PROPERTY DEMAND AND DEVELOPMENT

Africa is expected to show the most rapid growth in new millionaires over the next decade – albeit from a low base. The number of dollar millionaires in Nigeria, Kenya and Angola is expected to more than

Rapid urbanisation across Africa is giving rise to increasing opportunities

double by 2030; in fact, the number of millionaires in Nigeria is forecast

in regard to residential property development and ownership, says

to increase by 174% to 43 000.”

Andrew Golding, chief executive of Pam Golding Property Group. This is because urbanisation aids economic growth, as larger concentrations

It is said that the number of Africans with $30-million in assets – the

of people in cities create large customer bases, promote more efficient

ultra-high-net-worth individuals (HNWI) is anticipated to rise by 53% to

labour markets and reduce transport costs.

2 858 by 2023, far outstripping the average pace of growth across the rest of the world, and by which time there are likely to be 38 billionaires

Says Golding, “Many of the largest cities in Africa are growing rapidly.

on the continent. “These individuals are currently growing their real

Nairobi, Kinshasa and Dar es Salaam, for example, are expected to see

estate portfolios quite aggressively, which accounts for the growth in

population growth of over 70% by 2025. Africa’s megacities, including

the number of buyers of property in South Africa from other African

Lagos, Cairo, Luanda and Johannesburg, are increasingly the engines of

countries,” says Golding.

its economic growth. Future prospects for Africa offer significant growth potential for those “With robust economic growth rates anticipated for the continent during

with the foresight and ability to make the most of it. Opportunities for

the next decade, as well as healthy growth rates in individual wealth,

property investment in Africa range from large property developments

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Page 50: D EV EL O P M EN T U P DAT E

in all segments of the market, from low-cost housing through to exclusive

58 villas ranging from 650m2 to 900m2. The apartments are priced from

villas, as well as on an individual-property basis, depending on the

$325 000 to $720 000 (about R3.8-million to R8.4-million), and the

particular buying needs.

villas range from $820 000 to about $1-million (about R9.54-million to R11.63-million).

In Uganda, Pam Golding Properties is marketing a new upmarket marina golf resort development on Lake Victoria. It comprises 148 villas

The new development will be officially launched in April 2015, by which

and apartments, a championship golf course and a hotel. Situated

time one entire apartment block will have been completed, as will one of

halfway between Entebbe and Kampala, just five kilometres off the

each of the four different sized villas.

main highway, the secure development consists of 10 apartment blocks – each with eight units of 160m2, spread over four levels, and

The units are aimed at top business executives, and an influx of people

a 320m2 penthouse, all with scenic views over Lake Victoria – and

into the area is anticipated as a result of the oil refinery commencing operation in the next two years. Peet Strauss, Gauteng development manager at Pam Golding Properties, says key attractions on site include the marina and a championship golf course designed by GolfPlan USA, which also designed the Pezula golf course on the Garden Route as well as numerous world-class golf courses globally. “Managed for the past three years by the Serena Hotels group – known for its success in the conferencing market, the five-star Serena Hotel offers homeowners access to all services and restaurants, while the golf clubhouse is also managed by Serena. Furthermore, a new, greatly improved main road connecting Entebbe and Kampala is currently under construction, which will provide even easier access. “While the development is aimed at Ugandan purchasers who can acquire property outright, foreigners can transact on a leasehold basis ranging from 75 to 99 years and renewable automatically. Pam Golding Properties has an experienced developer and a team of Ugandan attorneys to assist throughout the process.”

PHILIPPI SHOPPING CENTRE OFFERING EXCITING OPPORTUNITY FOR NATIONAL RETAILERS

to expand into this growing area and to have a presence in this

The Philippi Shopping Centre, situated on the corner of Govan

Management. “Limited vacant space is available, or will be becoming

Mbeki (previously Lansdowne) and New Eisleben roads, offers

available, in the Philippi centre, with the units being perfect for national

exciting opportunity for retailers to have a presence in this busy and

retailers of fast food, clothing, furniture and the like, who are looking to

popular centre.

establish a presence in this growing node.”

Philippi is growing, and retail development is a necessary element

“THE PHILIPPI SHOPPING CENTRE OFFERS EXCITING OPPORTUNITIES NOT ONLY TO CONSUMERS IN THIS UNDERSERVICED AREA, BUT ALSO TO RETAILERS”

for successful urban renewal – especially in under-serviced areas. The centre, which saw a major renovation and extension a year ago, provides much-needed retail outlets for Philippi residents, who do not then have to travel to other areas to access banking facilities or to buy food, clothing and household and convenience goods. “The Philippi Shopping Centre offers exciting opportunities not only to consumers in this underserviced area, but also to retailers looking

popular centre,” says Sean Paul, managing director of Spire Property

Sean Paul

Page 52: D EV EL O P M EN T U P DAT E

CENTURY CITY’S R220M LUXURY RETIREMENT APARTMENT BLOCK LAUNCHES

block in the development Palm Royale, which comprises 58 units over 11 storeys.The first two phases of the Oasis development consisted of the Palm Springs and Palm Grove apartment blocks, with 174 units in total as well

Palme d’Or, the fourth apartment block in the Oasis Luxury Retirement

as a club house where all residents automatically enjoy membership. The

Resort at Century City, Cape Town, is to be launched soon. Meaning

facilities include a 25m indoor heated pool where regular water aerobics

‘golden palm’ in French, and named after the highest prize awarded at

classes are given by a qualified teacher; a massage room, sauna, steam

the Cannes Film Festival, Palme d’Or will be “unashamedly upmarket”,

room and fully equipped gym; a library, lounge areas, a restaurant, bar,

according to Colin Green, a director of the developer, the Oasis Joint

bridge room and billiard room; and a new 200-seater, multipurpose

Venture, which includes the Rabie Property Group and a Harries Projects

recreation and entertainment venue with a patio overlooking ponds and

consortium.

landscaped gardens. The gardens were extended with the opening of Palm Royale and will be further extended with Palme d’Or. Also completed

Ranging in size from 94m2 to 228m2, the 43 luxury one-, two- and three-

in phase one was the Oasis Care Centre, which offers hotel-style assisted-

bedroom apartments will include top-of-the-range finishes, covered terraces

living units, frail care, a specialised Alzheimer’s/dementia unit as well as

and air conditioning. The majority of the units will have utility rooms, and

physical rehabilitation.

all one-bedroom units will have studies. Priced from R2.65-million to R8.5million, VAT inclusive and with no transfer duty payable, all units will have

As with Palm Royale, Palme d’Or will be linked undercover to the

basement parking, and most of them will have a storeroom included in

Oasis Club. Green said that besides all of the facilities provided at Oasis,

the price. To be developed at a cost of R220-million, the 11-storey Palme

its location in Century City puts it within easy walking distance of other

d’Or will be served by two lifts and a 24-hour dedicated concierge. Its

amenities, including the Intaka Island wetlands reserve and Canal Walk

construction follows the successful completion in July of the third apartment

Shopping Centre. Occupation is scheduled for June 2016.

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RENPROP TO LAUNCH SECOND DEVELOPMENT IN ROSEBANK March 2015 will see the launch of Renprop’s second apartment development in Rosebank, named The Tyrwhitt, on the back of the success of The Vantage, a 10-storey apartment block that is situated on the corner of Bath and Tyrwhitt avenues. The Vantage launched a year ago and is currently under construction. It is anticipated that construction of The Tyrwhitt will start mid-2015, with an estimated completion date of June 2017. The Tyrwhitt, which is being launched by Renprop in conjunction with its development partner, Grapnel Property Group, will account for 200 of the more than 1 000 apartments that Renprop MD Chris Renecle expects will be required to satisfy demand in the area in the foreseeable future. Russel Peach, divisional manager of Renprop Residential Projects, says that the 200 units in the 14-storey Tyrwhitt building will be slightly larger than those at The Vantage, ranging in size from about 70m2 to more than 110m2. The penthouses will measure between 180m2 and 400m2. Prices will start at R1.8 million and will reach close to R10 million for the bigger penthouses.” Amenities will include a coffee shop and concierge.

THE BREAKWATER AT V&A WATERFRONT OFFERS LONG-TERM RENTAL APARTMENTS

one-bathroom unit and from R18 000/month for a two-bedroom, two-

The V&A Waterfront has launched its second long-term residential rental

In-house facilities include 24-hour security, free 5G Wi-Fi and a gym.

complex, The Breakwater, which is situated directly opposite the Victoria

Undercover parking is available. Residents will have access to an 18m

Wharf Shopping Centre. Offering 150 apartments across four floors,

rim-flow pool, surrounded by a timber pool deck, and almost 200m² of

The Breakwater makes living in this exclusive precinct accessible to a

poolside AstroTurf on which to relax or kick a ball about.

bathroom apartment.

wide range of budgets. Says David Green, chief executive officer of the V&A Waterfront, “The V&A Waterfront is an extension of the city and a neighbourhood within the city. Development at the V&A is market-led in response to the demand we have seen for urban rental apartments with harbour and mountain views. We experienced tremendous success with Ports Edge, the first long-term residential rental complex we launched at the V&A Waterfront, and this led us to fast-track development of The Breakwater; again, it is aimed at long-lease tenants who desire to live in the V&A Waterfront all year round. The Breakwater caters to those wanting a quality lifestyle in an exciting environment in which they can live, work and play.” The Breakwater units range in size from 30m2 to 120m2, with studio, one- and two-bedroom apartments available. Rentals vary from R7 000/month for a studio, from R13 000/month for a one-bedroom,

“THE V&A WATERFRONT IS AN EXTENSION OF THE CITY AND A NEIGHBOURHOOD WITHIN THE CITY. DEVELOPMENT AT THE V&A IS MARKET-LED IN RESPONSE TO THE DEMAND WE HAVE SEEN FOR URBAN RENTAL APARTMENTS WITH HARBOUR AND MOUNTAIN VIEWS” David Green

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Page 56: WO R D O N T H E S T R EE T

WORD ON THE STREET “Businesses in the retail chain are failing because they can’t manufacture, pack, trade and serve without electricity. Load shedding has already substantially inhibited the ability of retailers to trade optimally during the 2014 festive season… This stands to have farreaching negative impacts for South Africans”

“The bank considers three factors in general when a customer applies for a new home loan. These are affordability, credit history and the value of the property” Ewald Kellerman, head of sales at FNB Home Loans (Source: Fin24 “Obtaining a bond when self-employed”. 12 January 2015)

Neil Gopal, chief executive officer of SAPOA (Source:

SA Commercial Property News

“Property owners urged to work with Eskom amidst SA’s power crisis”. 15 January 2015)

“Nominal middle-segment price growth of about 8% is forecast, which will translate into real price growth of more than 3% this year, based on projected consumer price inflation of 4.5%, which is in line with real price growth of the past two years”

“It’s a game changer… You should be careful to assume oil at $50 per barrel is here to stay forever. But, for now, it’s in the price, and inflation will fall dramatically over the next couple of months” Malcolm Charles, a fund manager at

Jacques du Toit, property analyst at Absa Home

Investec Asset Management

housing market”. 14 January 2015)

rally on oil-triggered inflation ease”.

Loans (Source: Fin24 “Solid performance expected in

(Source: Finweek “Government bonds 22 January 2015)

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