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| US Fund Poised to Invest in South African Property |
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A U.S.-based private equity fund plans on doubling its investments in South Africa by year-end as it seeks investment opportunities across Africa during a global economic downturn.
International Housing Solutions (IHS) is a private sector fund targeting lower to middle-income earners and doesn't partner with government except in certain projects.
The fund shares in the profits of housing projects by giving money directly to private developers, allowing them access to bigger bank loans at reduced borrowing costs.
Millions of Africans live in shanty towns not only because they are poor, but also due to a lack of affordable alternatives.
South Africa offers some of the better prospects to specialist housing funds because millions of poor people live in tin and iron shacks in townships lacking proper medical care, sewage, schools and jobs.
Active in South Africa since 2006, IHS has injected 500 million rand to build affordable houses and hopes to invest in other African countries. Affordable housing projects could offer big profits.
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| Has The Property Market Bottomed? |
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The South African property market has experienced a steady decline in property price growth since the last quarter of 2007.
This growth decline eventually became negative growth and the extent of this property price decline varies from 5% to 20%, depending which sources you refer to and the geographical area under discussion.
A burning question in the minds of both buyers and sellers at present is: What will happen to property prices going forward, or more critically, when will property prices move into positive growth again? Tony Ketcher, managing director of Seeff Properties Randburg, believes that property prices have bottomed, and explains why.
"There are a number of simple facts which lead me to believe the property prices may have bottomed. It is, however, too early to expect that we will see any kind of growth in prices for the next 18 – 24 months.
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| South African Property Market Past Its Worst |
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Although Lightstone's National Repeat Sales house price inflation is still slightly negative year on year, it appears that the House Price Index bottomed out at the beginning of 2009 and that house prices are actually now on a modest upward trend, according to the latest Lightstone house price index released on Wednesday.
The report showed that monthly house price inflation (which tracks the month-on-month house price trend) was up 0,24% from March to April.
"This continues the positive trend we have been monitoring since January and appears to confirm that recent house price growth has moved out of negative into modest positive territory," said Lightstone.
"Given the volatility of monthly house price inflation, we have been cautious to confirm this positive trend, but four consecutive months of positive monthly figures gives us the confidence to confirm that house price are on the rise again."
Projecting forward to July, annual house price inflation is now effectively at 0%, which suggests that we have avoided the major house price drops experienced in foreign markets, said Lightstone.
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| Estata Wins Prestigious CNBC Property Portal Africa Award 2009 |
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Estata is delighted to announce that it has won an award in the category of Property Portal Africa.
We would hereby like to inform you that Estata has won the prestigious CNBC Property Portal Africa Award. The International Property Awards is open to residential and commercial property professionals from around the globe. The event is part of the International Property Awards, the world’s most prestigious competition dedicated to finding the best real estate professionals across the globe. The fact that Estata has won one of these coveted awards is proof that South Africa is not only able to compete at this level but also triumph within the highly competitive Europe and Africa property arenas.
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| Prices of Luxury Houses Buck Downward Trend |
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Luxury houses have been partly insulated from the residential property market slump.
Absa's latest housing review, released yesterday, showed that the affordable and luxury segments of the housing market experienced nominal growth in prices in the second quarter while middle segment houses were bearing the brunt of the price decline.
Jacques du Toit, a senior property analyst at Absa Home Loans, yesterday said prices in the luxury segment had performed better than the middle segment in recent quarters.
"This may be the result of the upper end of the market to some extent being less affected by trends in economic indicators such as inflation, interest rates, employment and income," he said.
The review revealed that the average nominal price of luxury housing, defined as houses valued at between R1.3 million and R11.5m, continued to rise in the second quarter.
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| New Report Shows Power of Cash |
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Cash sales - defined as transactions where no bond is registered at the time of transfer - have been on the rise since 2007 and now account for fully one third of all home sales in South Africa.
That is according to a report on changing buyer trends recently released by the South African Property Transfer Guide (SAPTG) and based on Deeds Office statistics and data.
The report shows that, having declined as a percentage of total sales between 2003 and 2007, cash sales then began to rise again and reached 33%of all sales by the 2008/ 2009 reporting period. On breakdown, cash sales now account for 35% of full-title sales and 30% of sectional title sales.
What is more, they account for 35% of the rand value of all sales, says Dieter Deppisch, national manager of property data research for the Knowledge Factory.
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| What Determines The Price of Property? |
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Find out what determines price.
Tony Clarke, managing director of Rawson Properties, says a property should sell for what a willing and able purchaser is prepared to pay and a willing and able seller is prepared to accept after both have compared their figures with those achieved very recently on similar properties in the same area. He says that among home sellers, there will always be a tendency to think that the valuation given by the selling agent on the property is unrealistically low.
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| VAT of Fixed Immovable Property |
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Where seller and /or purchaser are VAT vendors in respect of the immovable (fixed) property being sold.
The subject of VAT is complex and this only as a guide and is not comprehensive. Always seek professional advice before committing yourself to a purchase or sale of immovable property where there is a possibility of VAT implications. This deals with VAT where the Seller and/or Purchaser are VAT Vendors in respect of the immovable property being sold. See our Transfer and Bond Costs Tables where neither Seller or Purchaser are VAT Vendors in respect of the immovable property being sold.
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| Luxury Housing Still in the Money |
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Upper end housing priced above R3,1m is the only sector of the South African residential property market that is still showing positive growth.
According to data released earlier this week by Absa, luxury house prices valued at between R3,1m and R11,5m rose 4,5% in first quarter 2009 year-on-year (y/y). That is in stark contrast to house price movements in the market priced below R3,1m, which saw a drop of 0,3% over the same time. First quarter 2009 was the first time in 23 years that Absa has recorded an annualised drop in middle-segment house prices.
Jacques du Toit, senior property analyst at Absa Home Loans, says the luxury segment end of the residential property market is holding up visibly better than the middle end where prices are now dropping over a wide front. "This may be because the upper end of the market is to some extent being less affected by trends in economic factors such as inflation, interest rates and employment."
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| Commercial Property Index Shows Extremes in Returns |
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Capital value and currency swings produce contrasting global returns, says IPD, a global information business, dedicated to the objective measurement of commercial property performance.
The local currencies spread of movement in underlying capital values across 23 of the world's most mature property markets was 42 percentage points from best to worst through 2008, according to IPD Global Property Index.
Despite some severe capital falls, the estimated size of the professionally-managed global property investment market still topped the $4.6 trillion (R36 trillion) mark.
At the two extremes were Ireland, at -37.2 percent, and South Africa which produced +4.4 percent, this positive capital growth albeit reflecting domestic inflation of 11.5 percent.
Although three national property markets produced positive capital returns over last year, all markets suffered significant reductions on the previous year.
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