Neighbourhood 24 FEBRUARY 2019
PROPERTY & LIFESTYLE
Hot property Despite challenging times, the real estate market in certain areas in KZN is alive and thriving, page 2
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PROPERTY FOCUS: TOP SUBURBS
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PROPERTY NEWS
24 FEBRUARY 2019
Neighbourhood
Property focus
Best in show There’s vigorous debate as to best performing suburbs in KZN, but none as to the prowess of the lower end of the market. WORDS: ANNE SCHAUFFER IMAGES: SHANE VAN ECK, STEPHEN PILBROUGH & SHUTTERSTOCK
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he KwaZulu-Natal property market has been affected by a host of well-known extraneous local and global factors and has experienced the unpredictable rollercoaster ride of most provinces. For the past year certainly the lower end of the market has been far more buoyant than the sluggish top end. There are still active pockets up there, and according to New World Wealth’s 2018 report, houses and apartments on top-end residential estates outperformed the generally constrained local market, thereby bucking the trend. Each suburb has a psychological financial tipping point at play, depending on the suburb or area or road within the suburb. It could be a glass ceiling of R2m, or R2,5m, but above that, a sticky market.
The star performers BALLITO
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What does “best performing suburb” mean exactly? Are we
talking demand, top prices achieved, number of sales, or suburbs which have gained in popularity? Zimbali in Ballito and Hawaan Forest in Umhlanga appeared in the country’s top-10 estates (New World Wealth 2018), but gated estates at the top end almost have a life of their own. Lightstone’s most recent figures calculated the most expensive and high-growth estates in KZN (median property value) as Zimbali Coastal Resort (Ballito) R6,3m; Mount Edgecombe Country Club Estate (Mount Edgecombe) R5,8m; Simbithi Eco Estate (Salt Rock) R5m; Ilala Ridge Estate (La Lucia) R4,6m; Gowrie Farm Estate (Nottingham Road) R4,5m; and Dunkirk Estate (Ballito) R4,3m. Roger Hoaten, spokesperson, Seeff KZN and licensee, Seeff Berea, unpacks his view on “best performing suburbs”. He says, “Due to the often significant differences in the average price of property per suburb, representative comparisons of performance are difficult to make. Perhaps the most relevant comparative would be the volume of sales (units) as a factor of the number of doors in a given area.
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But even this criteria can be deceptive. From a licensee’s perspective, one of the most representative measurement criteria is a licensee’s market share per licensed area.” Grant Gavin, broker/owner, RE/MAX Panache, operating in Durban North and La Lucia, considers “future growth” as a factor in analysing top-performing suburbs in KZN. “The KZN North Coast is a hotspot for future growth in the province, and not just around Umhlanga and Umdloti but further north too. Airports, new shopping centres and schools are generally an indication of future growth and if you look at what has been developed in Umhlanga, Cornubia, and further north in Ballito, the trend of people moving further north is set to continue.” Lightstone’s 2018 figures of the top-10 high-growth suburbs (house price inflation) are, in the main, properties which fall in the lower to mid income, coastal homes, or those closer to industrial areas, therefore work opportunities. “Glenwood (South of Berea Road) 8,68%; Leisure Bay (South Coast) 7,97%;
Tongaat Beach (North Coast) 7,86%; Wartburg (inland) 7,4%; Woodgrange (South Coast, near Hibberdene) 6,95%; Palm Beach (South Coast) 6,68%; Trafalgar (South Coast) 6,54%; South Beach (Durban beachfront) 6,36%; Southgate (Phoenix, west of R102) 6,19%; and Hillary (southwest Durban, near Queensburgh) 6,18%. Lightstone comments, “These suburbs are, for various reasons, what we would describe as top-performing suburbs – not necessarily based on price appreciation but on popularity and demand – whether this is ongoing over many years or in more recent years.”
Traffic troubles Commutes impact demand for areas, and worldwide there’s increasing resistance to hours wasted in traffic. Although wanting to reduce time travelling to work and school drop-offs is paramount, buyers are also factoring in rising fuel costs. Mixed-use living is also gaining traction among a certain market sector, not least of all
AMANZIMTOTI
because of that commute. Greta Daniel, national sales and operations manager, Pam Golding Franchise Services, says, “Umhlanga has become a great example of successful mixeduse living. The Gateway precinct offers so many mixed-use options, where most homeowners do not require transport of their own.” Seeff’s Hoaten calculated his top five, in no particular order, as the KZN South Coast, Hillcrest, Umhlanga, North Coast (Ballito and Zimbali) and Richards Bay. “They’re experiencing excellent growth and sustained performance. That said, Seeff KZN as a region (including areas such as the Berea, Queensburgh, Pinetown, Pietermaritzburg and Newcastle) is experiencing aboveaverage sales and above-average growth in a constrained market.” He says, “The stand-out performer over the past year has probably been the South Coast, which has emerged as one of the strongest performers. It offers reasonable prices for buyers keen to experience life on one of SA’s most beautiful coastlines.”
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PGP’s Daniel says, “PGP’s five suburbs are, for various reasons, what we would describe as topperforming suburbs – not necessarily based on price appreciation but on popularity and demand – whether this is ongoing over many years or in more recent years. “A common thread running through these suburbs is the increased demand from and sales concluded by younger buyers. Others have seen tremendous growth in property developments, for example, Ballito with its large number of residential estates, and prime-located Umhlanga with ongoing demand for residential developments, mainly apartment buildings,” she says.
Northern splendour
It’s not possible to ignore the North Coast gold rush, so PGP pinpointed Ballito, Durban North, and Umhlanga, but also highlighted ’Toti and Pinetown.
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“Pinetown is an area which has been perennially popular among home buyers seeking value for money, especially younger and first-time buyers. It appears to be a stepping stone to grow their property investment to move into more affluent areas like nearby Westville, Kloof or Hillcrest. Pinetown is also accessible to those working in nearby industrial areas, or in Durban or Pietermaritzburg.” And Amanzimtoti, “Affordably priced Amanzimtoti, situated on the periphery and considered a ‘bedroom’ suburb of Durban, which falls within the eThekwini Metro, has experienced a steady increase in residential property sales since 2009, indicating a growing demand from home buyers. “These purchasers are across all sectors, with the relative affordability of homes in ’Toti undoubtedly a contributing factor towards the area’s growing appeal – particularly for those who commute to the workplace in Durban central or nearby industrial areas such as Prospecton, Mobeni and Jacobs, hence the moniker as a ‘bedroom’ suburb,” Daniel concludes.
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PROPERTY NEWS
24 FEBRUARY 2019
Neighbourhood
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hen you feel you’re in a position to buy a home and need a home loan, the smartest move you can make is become prequalified – in other words, before you head out to find your new home, find out what size loan you qualify for. It’s disappointing to find your perfect home and not qualify for that size loan.
Bond basics
How to get prequalified
For first-time buyers – or those who have been out of the property market for some time – here are the back-to-basics steps to securing a home loan
The wonderful thing today are the online tools available to assess whether you’re eligible for a home loan and what size. Look for instance at ooba’s home loan affordability calculators on its website. It’s important that you put in accurate figures to get an accurate outcome – this tool is an indicator, not a guarantee, and you’ll have to supply all the required documentation – salary slips and so on – to secure your loan when the time comes to make a formal application.
WORDS: ANNE SCHAUFFER IMAGE: SHUTTERSTOCK
If you don’t want to be prequalified online but prefer to go into your bank’s home loan department, of course you can do that and they’ll explain everything to you, including the additional fees which you’ll have to pay, like transfer costs. Rhys Dyer of bond originators ooba explains the criteria which banks use to award home loans. “Banks assess affordability and credit profile first when it comes to bond applications. Affordability is now based on net disposable income, which for many means access to less credit. A good credit score is all-important. Banks also look at your current financial situation, whether or not it might change in the next few years, as well as the stability of your income.”
A good credit score
You need a good credit score to be approved for a home loan. Dyer says, “Every year, ask for your credit score from a credit bureau, or use an online tool like ooba’s bond indicator so you always know what your status is when it comes to assessing your financial risk to a potential lender. Your credit score will be determined by issues like how well you manage your debt, how many accounts you have, and how long you’ve had them for, among others.
Is it possible to get a 100% home loan?
It is, but once again, it’ll be about affordability – it’ll depend on whether you can afford the monthly repayments on the amount for which you’re applying. For those who don’t have a deposit, but have a good credit rating, it’s definitely worth applying.
The interest rate
It’s important to negotiate the interest that the bank will charge you for the money you’re borrowing – if you work through a bond originator, they will, for no charge, take your home loan application, and present it to a number of different banks. That way, if you’re granted a loan by a few of them, you’ll be able to choose the best deal for you. Is it better to opt for a fixed or variable interest rate? According to Dyer, “If you’re working to a tight monthly budget and can afford to, it might be wise to fix your interest rate even though they’re usually higher than variable rates. Before buying a property, “stress test your budget to ensure you’ll still be able to meet your bond repayments if rates start to rise”.
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Going, going, gone! BidX1 makes it possible for everyone to buy basically any type of property by means of an online auction in real time – from your cellphone IMAGE: SUPPLIED
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e spoke to BidX1 South Africa’s CEO: auctions and sales MC du Toit to shed some light on online auctions. Q: What is the difference between an online auction and a traditional auction? A: Our auctions take place fully online and in real time. Every bid placed during the sale of a property is logged and displayed in real time and this record, along with the sale price, can be viewed publicly on our website both historically and at the time of the auction. So you can say that fundamentally the lead-up to the auction is the same, but in our case the transactions happen online and the process is more transparent and fair. Q: What makes the BidX1 online model so successful? A: The BidX1 platform is fully transparent, creating trust for both buyers and sellers. All bidders are required to register and complete an identification process and place a deposit prior to participating in our auctions. Legal documents are
available for inspection on our online portal prior to auction. With every bid being displayed in real time, along with the final sale price, buyers are assured that they are competing against other genuine parties who have completed the same process as themselves. They can see competing bids as they come in and accurately assess demand for the property. And they know that whoever is the successful buyer will instantly enter a legally binding contract once the lot is sold as BidX1 exchanges contracts on their behalf immediately. Q: What about convenience? A: Our auctions allow everyone to bid from anywhere in the world, and yet you still have direct contact and a wealth of information from the auctioneer. Our platform is designed to assist buyers and sellers from the start of the process right through to the conclusion of the sale. Over 40% of our auction transactions are being conducted via a handheld device. Q: Don’t you lose the personal touch with online auctions? A: No, because although advanced technology has allowed us to enhance
the experience of buying and selling property, it has not changed the fundamental role and personal involvement, advice and guidance of the property professional. Apart from access to us and detailed information on properties for sale prior to auction, buyers for the first time have full access to the auctioneer during the auction process. Buyers can contact us while bidding if they need any assistance or have questions. Q: What kind of properties will you be auctioning in South Africa? A: BidX1 South Africa will offer a full spectrum of properties from residential to commercial, retail, industrial and agricultural property and investment portfolios. Q: Do these auctions achieve realistic prices? A: The online auction market is seeing increasing levels of interest from buyers and sellers alike and has become a respected method of transacting, achieving market-related prices, and free of any suspensive conditions. Going forward we anticipate this trend to increase.
Q: Any advice to those buying online for the first time? A: Firstly, buyers must engage with the auctioneer and conduct a full due diligence prior to the day of the auction. We have property experts who will be able to answer any questions buyers may have, ranging from price up to the most technical aspects of any property. Secondly, buyers must register in time to make sure they have all the necessary documentation in place before the auction. And finally, we have a support team that will take all bidders through the bidding process with examples of what will happen when bidding starts, so buyers will be able to run through a bidding simulation before the auction. Q: How do you register to bid? A: Whether you want to register to bid or sell your property, go to bit.ly/2Dztajv and follow the easy step-by-step process. Q: When is your first auction? A: Our first multiple auction is on 10 April this year and the catalogue of properties to be auctioned will be launched in early March.
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For more information visit www.jawitz.co.za/investing-in-the-uk or email sevencapital@jawitz.co.za
AGENTS KNOW HOW TO MARKET YOUR HOME TO SELL
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Another good reason why you should use an estate agent
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