About Me

My photo

I am a qualified Attorney. I specialise in Property Law, Commercial Law, Corporate Law and Trusts.
 
Please visit our website at www.prop-law.co.za for more details.
 
I am an elected Committee Member of the Property Committee of the Association of Pretoria Attorneys and through my involvement, I like to ensure that I am constantly at the "sharp-end" of Conveyancing Practice.

I am the elected Chairman on the Gauteng Council of SAPOA. The South African Property Owners Association (SAPOA) is the biggest and most influential institution in the property industry. SAPOA members control about 90% of commercial property in SA, with a combined portfolio in excess of R150 Billion (about $22 Billion). I am also on the National Council and the National Legal Committee of SAPOA.
 
Member of the Institute of Directors South Africa and Member of the Sirdar Governance Panel.

30 April 2013


Click HERE to visit us on Facebook


Atterbury to list its property fund in Q4
Could sell five regional shopping centres to Vukile.

JOHANNESBURG – The Atterbury Group plans to list its property fund on the JSE  in the fourth quarter of this year. According to MornĂ© Wilken, chief executive officer of the fund – currently called Atterbury Investment Holdings – the reasons for the proposed listing is twofold. “It potentially will create more liquidity for our shareholders, because in an unlisted company – although it is public – it is more difficult to trade,” he says. It will also make it easier for the company to raise money for its huge development pipeline, such as the R3bn Mall of Africa in Waterfall, in future.

Louis van der Watt (pictured), chief executive officer of the Atterbury Group, says the fund’s gross assets is valued at around R12bn. Depending on the gearing, the market cap of the fund could be around R6bn during its initial listing.

Atterbury is still contemplating whether or not it will list on the new REIT board of the JSE.

Atterbury’s comments follow a recent announcement by the Vukile Property Fund (JSE:VKE) that it has entered into negotiations for the acquisition of the Wingspan property portfolio comprising of five regional shopping centres. According to Laurence Rapp, chief executive of Vukile, the acquisitions could push the Vukile Property Fund’s asset base “comfortably above the R10bn level.” The Wingspan property portfolio, comprises of Irene Mall, Hartebeespoort Mall, Weskus Mall, Westwood Mall as well as a shopping centre in Jeffreys Bay.

Atterbury, currently owns just over 30% of the Wingspan portfolio, according to Van der Watt. The rest of the portfolio belongs to a consortium of investors including Retail Africa, Corovest, Absa and Leafcapital, he says. Van der Watt says Atterbury decided to sell its stake in Wingspan, since the group is currently investing in large retail centres and the Wingspan portfolio does not fit its investment criteria anymore. The Wingspan portfolio’s biggest property is only around 30 000 square metres while the Mall of Africa is 120 000 square metres, he notes. The value of the proposed transaction between Atterbury, the consortium and Vukile is under wraps for now, although a detailed cautionary could be published before the company’s results are released on May 27, 2013. Van der Watt indicated that the current market value of the Wingspan portfolio is around R2.5bn although the value of the transaction would not necessarily be the same.

Rapp says Vukile’s bid for the Wingspan portfolio is part of its stated strategy to grow the size of the fund by buying good quality regional shopping centres and to bulk up on its retail exposure. “We are also keen on having an overweight exposure to retail in our portfolio, so we would like to have approximately 60% of our asset base in retail centres,” he says. Although recent data indicate that certain regional shopping centres might be under pressure, Rapp says Vukile does not currently experience such a trend. “As with all property, retail is going to go through different cycles, but if you look historically, retail has always been the most defensive asset class,” he notes. “We think that retail is (still) the most desired asset class and the most defensive asset class, and that is why we have made a call in our fund to go overweight in the retail sector. But having said that, we also like to have a balance in our fund, so it should be 60% retail and then the balance split between office and industrial,” he says.

The implications for investors

Rapp says the key question that everybody is asking at the moment, is what the proposed transaction’s iMpact (JSE:MPT) will be on earnings. “That I can’t answer at the moment because we haven’t yet published those figures, but we have a very good idea what that answer will be,” he says.

Rapp says the East Rand Mall acquisition moved Vukile’s asset base to approximately R8.7bn. “We’ve recently also announced the Encha transaction, our empowerment deal, where we’re going to be buying a portfolio of five buildings, largely government-tenanted, for about R1.4bn. That would put our asset base around R10bn,” he says.

“Assuming we buy the whole of Wingspan, it will push the portfolio very comfortably above the R10bn level, which means that Vukile is then starting to play in sort of the bigger section of the listed property sector which does start attracting more index tracking money,” he says. Rapp says the company has been working hard to improve the quality of the portfolio – also selling assets from the fund – which is a positive development for shareholders in the short and longer term.

Van der Watt says Atterbury will invest the proceeds from the sale of the Wingspan portfolio in its larger developments, which should be positive for investors.

An analyst comments

Anton de Goede, property analyst at Coronation Fund Managers (JSE:CML), says through this proposed acquisition Vukile will increase its retail exposure, which it has been aiming to do in the recent past.

“However what is important is the yield at which this asset will be acquired since it has had its letting challenges in the past.”

Protector probes R85m housing mess in Tshwane

Protector probes R85m housing mess in Tshwane

The office of Public Protector Thuli Madonsela has confirmed that she is probing the multimillion rand housing development in Saulsville, where millions were paid for housing units that have failed to meet building standards.

The Pretoria News reported yesterday how a budget of R85 million was spent to construct 104 units as part of efforts to eradicate hostels in the area, but they still remain unoccupied as a certificate of occupation has not been issued because of the poor condition of the housing units.

Allegations of corruption involving local councillors have also been made by residents in relation to the list of people to live in the units when they are finally ready for occupation.

According to residents, people who had not lived in the hostels before were poised to move in when the units were completed, posing a potentially volatile situation at the hostels.

Political parties have also called for the Gauteng local government and housing MEC to institute an investigation into why the units do not meet the required building standards despite such a hefty price tag.

The IFP lodged the complaint with Madonsela, particularly on the issue of the prioritisation of the current hostel dwellers as beneficiaries when the units are ready for occupation.

The protector's spokesman, Oupa Segalwe, confirmed yesterday that Madonsela had already been in contact with the municipality over the matter and was expecting more information from the complainants - the IFP.

The DA in Gauteng said it would request an official investigation into the matter. "This staggering price tag for one unit could have bought at least 12 of the 40m² free standing two-bedroomed houses being rolled out by the DA-led Midvaal municipality. Some 1 300 houses could be built with the Midvaal model from the R85m allocation, said DA spokeswoman on housing Janet Semple.

"This brazen waste of public money and disregard for the serious housing needs of the people of Tshwane must not go unpunished. Gauteng Local Government and Housing MEC Ntombi Mekgwe must investigate the inflated cost price for these houses and the failure to complete the contract to the requirements.The MEC must ensure that the contractors are not just blacklisted but also prosecuted," Semple said.

The SACP in Gauteng also slammed the non-completion of the housing units and the failure to relocate the residents currently living in the old hostels.

Pretoria News

Click HERE to visit us on Facebook


29 April 2013

Ratepayers can't pick and choose parts of bill to settle, says judge


Click HERE to visit us on Facebook

Ratepayers can't pick and choose parts of bill to settle, says judge

Ratepayers may not withhold payment of their rates because they feel they are not receiving a satisfactory service, but they may refuse to pay when they are not receiving a service at all.

In a complex judgment on Friday, the Constitutional Court dismissed an application by a group of ratepayers who withheld payment because they were dissatisfied with the services.

Olga Rademan, a member of the Moqhaka Ratepayers and Residents' Association in Kroonstad, declared a dispute with the Moqhaka municipality in June 2008. She and other members withheld payment of their rates and taxes in protest against poor service, but paid for electricity, water, and other services. The municipality disconnected her electricity in August 2009.

After her electricity was disconnected, Rademan brought an application in the Kroonstad Magistrate's Court, which ruled that the municipality was not entitled to cut the electricity supply to her property.

The high court overturned the lower court's decision.

Rademan appealed to the Supreme Court of Appeal, which dismissed the case and said that a municipality had the option of consolidating the accounts for various services. This was to prevent residents from electing for which municipal accounts they wished to pay.

She then took the matter to the Constitutional Court.

Yesterday Judge Raymond Zondo denied the Kroonstad resident's appeal to stop the municipality cutting off her power after she stopped paying rates. "A resident cannot pick and choose which components of their rates bill to pay," the judge said.

The court held that there was no conflict between the Electricity Regulation Act (ERA), the Municipality Systems Act, and by-laws. Judge Zondo said however, that in this matter, it was not Rademan's case that the municipality claimed payment for services that it had not rendered.

"However, where a municipality claims from a resident, customer or ratepayer payment for services, the resident, customer or ratepayer is only obliged to pay for services that have been rendered.

"There is no oblication on a resident, customer or ratepayer to pay the municipality for a service that has not been rendered," the judge said.

Judge Zondo said that ratepayers may lodge a complaint or query concerning the accuracy of an amount due and payable in respect of a specific municipal service a reflected on the account rendered.

Such a query of complaint must be accompanied by the payment of the disputed amount. The customer did not have to pay the disputed portion of the account pending the outcome of his or her appeal to an appeals committee provided for in the by-laws.

Lee Cahill, a founding member of the Joburg Advocacy Group, said he was not surprised by the judgement.

"It is a sad day for ratepayers, who now effectively have no recourse when local government levies rates and taxes but fails to deliver the services it is supposed to," said Cahill.

National Taxpayers Union chairman Jaap Kelder called the judgment "party political."

"We will now send out advice to members to specify to their municipalities which services were not rendered and dispute them," he said. "This is a miscarriage of justice."

Saturday Star

25 April 2013

'Housing inertia hobbling economy'

A number of Articles came out today about the state of lending in SA.

The Article below emphasizes the importance of the housing market to the overall health of the economy.  However, there are also two Articles on Moneyweb detailing the problems experienced by banks in lending and, in particular, the impact of Basel III on their ability to lend.

The first article entitled South African banks tighten lending can be found HERE:

 The second article, which relates more to unsecured lending and is entitled How big of a problem is unsecured lending for banks? ... can be found HERE.

 
Click HERE to visit us on Facebook

 
'Housing inertia hobbling economy'

The South African economy would not recover unless there was a recovery in the housing market because building was an engine for growth and wealth creation, BMI-Building Research Strategy Consulting principal consultant Llewellyn Lewis said yesterday.

However, mortgage advances in current values dropped 57 percent from R440 billion to R218bn between 2007 and 2009 and it could take a decade or more for mortgage advances in current values to reach the same level as the peak in 2007, Lewis said at a building, construction and property industry forum in Johannesburg.

Nonetheless, mortgage advances had increased by 314 percent between 2000 and last year, he said.

Lewis referred to the structural shift in finance, with banks growing unsecured lending ahead of home loans and asset finance. This, he said, was because unsecured lending was more profitable, while new regulations discouraged banks from taking on long-term loans.

He expressed concern about the declining prominence of mortgage lending, which would make home ownership difficult and hurt fixed investment spending. He asked what the leadership of the industry was doing about this.

Standard Bank's head of home loans, Steven Barker, said yesterday that the capital and liquidity requirements on banks under the Basel 3 regulatory requirements meant there was more uncertainty about the consequences of long-term lending. This was constraining the appetite for mortgage lending, he said.

Barker said Standard Bank understood those risks. Providing mortgage finance to its client base was important, and it could not "stop-start" it.

The bank grew its home loan book by about 4 percent to R299bn in December last year from a year earlier and made grants totalling R34.5bn last year to raise its home loan market share to 29 percent from 28.8 percent, Barker said.

Absa has 26.6 percent of the market, Nedbank 20.7 percent and FNB 15.9 percent.

However, property analyst Lightstone said last year that the number of mortgage bonds issued fell to record low of about 9 000 a month in the third quarter from a peak of more than 50 000 a month in 2007.

Barker said mortgage bond foreclosures remained at historically high levels despite declining substantially since 2007. Overall mortgage defaults, which were regarded as being more than three months in arrears, were between 7.5 percent and 8 percent.

Lewis stressed the importance to the economy of investment in affordable housing.

He said investment in affordable housing was large at 40 million square metres of building a year, but the industry was tracking along at about 200 000 units a year.

The backlog would rise to 3 million units by 2020 at this pace of delivery, and the objective as a country should be to raise delivery to about 500 000 units a year. This would reduce the backlog to 1.3 million units by 2020, Lewis added.

"We are losing momentum and sight of what we should be doing and there is all kind of talk about upgrading squatter camps. The target must be the eradication of all slums or informal settlements by 2025."

Lewis said it was most likely that South Africa would follow a low road rather than an upper middle road scenario in affordable housing. "The difference between the high road and lower middle road could be R560bn and 940 000 jobs over the eight years to 2020. There is an incentive to do this if we had the guts," Lewis said.

Construction was growing at 9 percent year on year in constant values, he said.

Business Report

24 April 2013

SHAREMAX: NOVA PROPERTY GROUP HOLDINGS

Here is the latest Article on Moneyweb relating to the long-running saga of Sharemax.

All you need to know is contained in the following paragraphs from the Article:

  • Nova Property Group has been in existence for over a year but there has been no word on when its financial statements might be published. These financial statements should provide investors with an idea of Nova’s financial health and thus the likelihood of eventual repayment of their debentures, or, if they selected shares, what these shares might be worth.

  • Because it is a public company, Nova’s financial statements should be available, on request, from the Companies and Intellectual Property Commission (CIPC). Earlier this year, Moneyweb made a request to the CIPC’s disclosure division for copies of Nova’s financial statements. On February 26, 2013, CIPC informed Moneyweb that no financial statements were on record for Nova.
 

Sherlock Holmes famously said "when you have eliminated the impossible, whatever remains, however improbable, must be the truth"

In the absence of any evidence to contrary, one must assume that the failure by a Public Company to meet its statutory reporting requirements is an indication that they have something to hide.

Surely, the company (or Dominique Haese on its behalf) could either make the financial statements available as they are required to do or, alternatively, to simply state that the financial statements are not available for "XYZ reasons".  Simple really ... or should I say: "Elementary, my dear Watson!"


Click HERE to visit us on Facebook


Wanted: Financial statements for multibillion rand property group

Share and debenture holders deserve to know how this public company is performing.

JOHANNESBURG – Nova Property Group Holdings, a public company with a large property portfolio, has given no guidance on when share and debenture holders might expect to receive financial statements. Nova is the company that owns all the properties that used to form part of the Sharemax portfolio. It was formed as a result of a ‘Section 311’ rescue scheme which received court sanction in January last year.

Nova Property Group and its subsidiary have issued shares and debentures to some 34 000 investors who previously held instruments issued by the various Sharemax syndication companies. The total amount invested was about R4.5bn. The Sharemax investors could choose whether they wanted to received shares or debentures. The shares are issued by the public company Nova Property Group Holdings. The debentures are issued by Nova Property Group Investments, a private company which is a wholly-owned subsidiary of Nova Property Group Holdings

Nova Property Group has been in existence for over a year but there has been no word on when its financial statements might be published. These financial statements should provide investors with an idea of Nova’s financial health and thus the likelihood of eventual repayment of their debentures, or, if they selected shares, what these shares might be worth.

If Nova Property Group has a February year end, this would mean that financial statements to February 2012 are long overdue. Moneyweb contacted Nova director Dominique Haese on Monday to ask about the financial statements. Haese said “no comment” before disconnecting the call. Similarly, a debenture holder who asked about financial statements was informed on April 18 that he would receive feedback “in time”. He has heard nothing since. Likewise, other investors and financial advisers polled by Moneyweb say they have not received financial statements.

Because it is a public company, Nova’s financial statements should be available, on request, from the Companies and Intellectual Property Commission (CIPC). Earlier this year, Moneyweb made a request to the CIPC’s disclosure division for copies of Nova’s financial statements. On February 26, 2013, CIPC informed Moneyweb that no financial statements were on record for Nova.

Moneyweb also contacted Nova’s auditors, BDO. Partner Japie Schoeman replied: “I can confirm that we are the auditors of the Nova Property group of companies. In terms of internal policies and client confidentiality rules that we are bound to, I can however not give you any other information. I hope you will understand.” Schoeman would not even confirm whether BDO has been supplied with the information necessary to perform an audit. This type of confirmation has previously been given to Moneyweb by auditors of other companies, and would not appear to breach client confidentiality. According to CIPC records, Nova’s directors are: Dominique Haese and Dirk Koekemoer, both of whom were involved with Sharemax prior to its collapse, accountant Rudi Badenhorst, and corporate lawyer Connie Myburgh. Prior to publication a draft copy of this article was sent to Haese with the invitation to correct possible factual errors and offer additional comments.


Haese’s response follows:

Dear Mr. Cobbett,

Your email and ‘draft article’ of yesterday refers.

At the outset, please note that the Nova Group insists that you publish the content of this email, together with whatever Moneyweb intends to publish, if at all.

Should Moneyweb choose to publish the “draft article”, the Nova Group insists that such “draft article” be published exactly, word for word, as such “draft article” was submitted to us for comment.

The Nova Groups’ only comment, at this time, is that the Nova Groups’ Financial Statements have been and are available to those persons who are entitled thereto.

Due to the persistent negative and destructive nature of “reporting” experienced from Moneyweb, the Nova Group is not prepared to share any information with Moneyweb, nor to further comment on any communication from Moneyweb.

Hence the comment from myself (Ms Haese) to you referred to in your “draft article”.

Moneyweb’s behaviour in attempting to consistently force communication, linked with the arrogance to attempt to enforce “cut-off timelines for comment”, unilaterally imposed by Moneyweb, is deplorable and rejected.

History has shown that Moneyweb will, in any event, publish what it sets out to publish, whether or not comments are provided, and this under the ever present threat that failing comment, Moneyweb will publish what is put forward in the form of a “draft for comment”, notwithstanding how factually incorrect, bias and detrimental to third parties the proposed “draft for comment” may be.

All the rights of the Nova Group are reserved pertaining to the persistent factually incorrect reporting by Moneyweb and the intentional dissemination of factually incorrect, bias and detrimental information.

Regards
Dominique Haese

22 April 2013

'Need to inject new life' into Pretoria inner city

I really like Mayor Kgosientso Ramokgopa because (at least from an outsider's perspective) he appears to be trying to do things for my City.  In addition, he is articulate and can therefore generally clearly express the intended outcome of his Council's plans.

HOWEVER, in this case I think that this is a hare-brained scheme and probably a waste of money.

Virtually every day I go to the Deeds Office in the City Centre.  I used to have a monthly parking in a parking arcade but for the last year or so, I rely mostly on finding something on the streets surrounding the Deeds Office.  It is noticeable that for some inexplicable reason, the Council has already converted a fair percentage of their metered street parking into "no-stopping zones"! CRAZY!

Now, they are building the BRT Route and Skinner Street is down to one or two lanes and we can see the effect of road closures on traffic flow.  This is temporary but gives a clear indication of what the effect will be of the proposed permanent closures.

Government (national/provincial/local) seems to lose a lot of court cases against NGO's and other interested parties. In my estimation, the sole reason for government's poor success rate in Court, is its failure to create proper public participation forums IN THE BEGINNING!  They then try and patch it up after the fact with hastily convened and poorly conceived public participation hearings.  This appears to be the case again in the process described in the Pretoria News Article below.

I have my own ideas about the Pretoria City Centre but I'll save those for another Blog Post.

Gareth Shepperson

Click HERE to visit us on Facebook



'Need to inject new life' into Pretoria inner city

Concerns have been raised about the practical implementation of the Tshwane Metro Council's Operation Reclaim which includes the partial closure of some streets in Pretoria's inner city.

Several stakeholders have expressed concern that this will be bad for their operations and have come up with "an alternative plan" for operations in the inner city.

The stakeholders, which include the State Theatre, the Reserve Bank, property letting company City Property and the Tshwane Chamber of Commerce and Industries (TCCI), are of the opinion that instead of partly closing some streets, the municipality should look at ways of rejuvenating the inner city.

The metro council has agreed to the partial closure of certain streets as part of Operation Reclaim.

Consultant Guy Briggs said at an Operation Reclaim workshop at the Pretoria City Hall yesterday there were no clear indications of the impact the project would have on public transport in the inner city.

Briggs said his clients - which include the State Theatre, City Property and the TCCI - supported, in principle, the metro council's ambitions to make the city workable.

"But there are issues that include the bus service (municipal and the Gautrain), which need to be answered. There is no clear indication on public transport and no room has been provided for new developments," he said.

Briggs said they believed the metro council should not partly close Sisulu (Prinsloo) and Lilian Ngoyi (Van der Walt) as this would impact negatively on Sammy Marks and the State Theatre.

According to Briggs, the State Theatre has an underground parking area with the entrance and exit in Sisulu (Prinsloo) Street.

Briggs said the metro council needed to inject new life into the inner city.

"There should be activity day and night; events and festivals should be organised; restaurants, coffee shops and bars should be provided. There should also be performance spaces, markets and artists' studios," he said.

Briggs said his clients supported what the municipality was doing, "but we want you to involve us... we have a significant role to play".

Another consultant, Peter Purchase, said a number of on-street parking bays would be lost as part of Operation Reclaim.

It is expected that there will not be any on-street parking in Sisulu (Prinsloo); Church Square and Lilian Ngoyi (Van der Walt) streets.

Purchase said they were looking at the possibility of turning Du Toit Street into a northbound one-way.

He added that there were a number of issues which needed attention, including the effect the project would have on parking and public transport. He said a study and policy were required on parking and public transport.

The TCCI president, advocate Salim Yousuf, said there were a number of questions which needed answers.

Yousuf said studies should have been done and approved before the matter was approved by the council.

Yousuf said it was worrying that the member of the mayoral committee responsible for economic development and planning, Subesh Pillay, was not at the workshop.

"He initiated the workshop but failed to attend. There was no political direction on some of the issues raised," said Yousuf, adding that they would approach executive mayor Kgosientso Ramokgopa to have the council's decision reversed.

The strategic executive director, economic development and planning, Thembeka Mhlengwa, said Pillay could not go to the workshop because of last-minute commitments.

Mhlengwa gave the assurance that the workshop was not the last and that the master plan for Operation Reclaim had not been finalised.

Pretoria News

Basel III rule changes will prove positive for property buyers


Click HERE to visit us on Facebook


Basel III rule changes will prove positive for property buyers

For many months, interest rate concessions on home loans have been virtually unheard of, and many borrowers have been able to secure loans only at one or two percentage points above prime.

But now things are set to ease somewhat, says Rudi Botha, chief executive of mortgage originator BetterBond. This is thanks to a decision by the Basel Committee on Banking Supervision ( BCBS) to change some of the new capital reserve requirements for banks that were due to be implemented in 2015.

These liquidity rules, proposed in 2010 as part of the Basel III plan to help banks survive financial crises, were widely felt to be too stringent for banks in emerging or developing economies like South Africa. Nonetheless, financial institutions in those countries had begun preparing for their implementation by raising their lending rates, says Botha.

"However, earlier this year the BCBS widened the definition of the type of assets that banks will need to hold in reserve as a buffer against financial stress, and also extended the deadline for the full implementation of the tal reserve requirements should mean banks have more money to lend and can afford to be a little more lenient when it comes to home loan interest rates.

"And even a small rate concession can make a huge difference to the total price paid for a home over the 20-year life of a loan. At 8.5 percent, for example, the total interest paid on a R1m loan over 20 years would be R1.08m, and at 9 percent, the total interest paid on the same loan would be R1.16m."

As things stand, he says, the banks already appear to be moving back into home loan lending and away from higher interest rate personal loans, and BetterBond has seen the average home loan approval rate increase from 61 percent to 67 percent in the past 12 months.

"In addition, the banks have been reporting some better results from their home loan divisions, and as the returns on this type of lending continue to improve, we believe the capital allocations by their treasury departments for home loans will become more favourable and enable more rate concessions, especially with the Basel III rules having been changed." A RECENT survey indicates that about 65 000 people are employed directly and indirectly on secure gated estates and sectional title residential developments.

Of the total, 9 864 are employed directly by home owners' associations (HOAs), and other estate bodies such as clubs and schools account for 23 376. The remaining 31 680 people are employed in outsourced services like security and landscaping.

"On a conservative earnings estimate of R5 000 a job a month, the organised and managed community sector accounts for an annual payment in salaries and wages of at least R3.9 billion," says Jeff Gilmour, president of the Association of Residential Communities (ARC), which conducted the nationwide survey.

"If the front-end costs of construction and development are taken out of the equation, as well as direct employment by individual households, the biggest ongoing generator of formal employment in the residential property sector in South Africa is the management and maintenance of community estates and complexes."

The survey was conducted by ARC across 80 of its membership of 130 estates countrywide, which represents about 45 percent of the market in terms of number of homes.

"The data supplied by the participating ARC members were then extrapolated across the rest of our membership, as well as non-ARC-affiliated estates, to provide a national picture," says Gilmour.

"Organised communities account for 8.3 percent of South Africa's developed land and are home to around 5 million people. HOAs in gated estates have assets of R800bn under their management."

Call Jeff at 0861 462 463 or e-mail jeff-AT-hoasupport.co-DOT-za

Weekend Argus (Saturday Edition)

16 April 2013

Betterbond figures show improvement in home loan approval rate


Click HERE to visit us on Facebook

Betterbond figures show improvement in home loan approval rate

The extent of the improvement in the residential property market over the past two years is clearly indicated in the latest statistics from mortgage originator BetterBond, which show that home loan approval rate has risen from 61 percent in March 2011 to 69 percent last month.

During the same period, the average home purchase price paid by BetterBond clients has fluctuated, hitting a low of R780 000 last January and spiking at R960 000 last August.

But it has generally also shown an upward trend, to reach R905 000 last month, compared with R786 000 in March 2011 (a 15 percent increase).

However, BetterBond chief executive Rudi Botha notes that the average deposit percentage required by lenders has varied little over the past two years, with the result that the average home loan amount approved has risen from R700 000 in March 2011 to R738 000 last month.

"Obviously the banks are feeling increasingly comfortable about lending to the residential market again as the balance of supply and demand improves.

"In addition, most prospective borrowers now have much better financial profiles than was the case two and three years ago."

The BetterBond statistics represent a quarter of all residential mortgage bonds being registered in the Deeds Office and include applications to, and bond grants from, all the major lending banks in South Africa, he says.

These statistics show that though first-time buyers continue to account for a large percentage of home loan applications, that percentage has declined from 48 percent in March 2011 to 39 percent in March last year and 36 percent last month.

"It's clearly getting more difficult for first-time buyers to enter the market.

"Although the average purchase price in this sector has risen some 7.5 percent in the past two years, the average home loan amount approved has only increased by about 6 percent, indicating that firsttime buyers need bigger cash deposits to secure loans," Botha says.

"And because salaries have not been rising as fast as the cost of major budget items like food, transport and utilities, it is becoming more difficult for prospective buyers to save these amounts.

"In addition, because they are often either still living with their parents or renting, firsttime buyers have more flexibility when it comes to deciding when to buy, and they will often back off from the market when economic growth drops - as it has in the past year - and business confidence and employment prospects start to look shaky," Botha says.

On the other hand, the steady if slow increase in middle-bracket home prices in the past two years has meant that repeat buyers have now often built up considerable equity in their existing homes, which could go a long way towards covering the deposit required to buy their next property.

"Such buyers are the ones best placed at the moment to make the most of the historically low interest rates.

"Indeed, if they have sound credit records and sufficient income as well as substantial deposits, they can now often upgrade to better properties for not much more a month than they are paying for their current homes," Botha says.

Weekend Argus (Sunday Edition)

Chance to air Pretoria CBD road closure gripes


Click HERE to visit us on Facebook

Chance to air Pretoria CBD road closure gripes

Businesses and other stakeholders opposed to the partial closure of a number of streets in Pretoria's inner city will this week be given an opportunity to have a say on the matter.

Member of the mayoral committee responsible for economic development and planning, Subesh Pillay, will host a workshop at the Pretoria City Hall on Thursday.




The workshop is aimed at providing further details in connection with the Tshwane Metro Council's Operation Reclaim. The project entails the closure of several streets and the relocation of a number of taxi ranks in the inner city.

The streets which are to be partially closed are Lilian Ngoyi (Van der Walt) between Pretorius and Madiba (Vermeulen); Sisulu (Prinsloo) between Madiba and Pretorius; and Helen Joseph (Church) between Du Toit and Thabo Sehume (Andries).

Final approval for the partial closure of the streets has been granted by the municipality.

Objections have been received from a number of businesses operating in the inner city.

The Tshwane Chamber of Commerce has also objected to the partial closure of the streets.

The chamber stated that the municipality needed to undertake jointly with business, an economic study and an impact assessment in order to determine all risks "that may actually and potentially impact both positively and negatively on the retail sector and other defined business in the inner city and affected precincts".

"A plan needs to be provided explaining and detailing all risks and mitigation of such risks and associated costs and time frames, including, but not limited to widening of alternative streets, alternate parking facilities and parkades, informal trade markets, taxi pick-up and drop-off points, upgrading and renovation of ageing infrastructure," said the chamber's president advocate Salim Yousuf.

DA councillor Siobhan Muller said the closure of the streets would cause "a ripple effect of gridlocking the rest of the city, forcing more traffic onto the already overloaded Skinner Street (Nana Sita)".

"This west to east transport route (Nana Sita) has been identified for the TRT (Tshwane Rapid Transit) route, hoping to remove motor vehicles from it. Instead, this ill-advised plan to close other major routes will push more traffic onto a TRT route.

"Paul Kruger Street is at capacity but will be required to still take more traffic," she said.

Muller said the closures or partial closures will impact on motor vehicles, TRT, goods transportation from west to east, "the limited transport we currently have".

Muller's colleague, Francois Bekker, said the street closures would have a far-reaching impact on the flow of traffic in a western direction via Pretorius Street, as well as traffic flow in an eastern direction via Madiba Street (Vermeulen).

"There will, of course, be other traffic flow problems as well. Yes, non-motorised transport in the inner city is a good idea. This can, however, only be a realistic idea if other supportive transport systems and facilities are in place," he said.

Bekker said "the notorious Tshwane Bus Service", for example, offered no alternative to private motorist transport in the Tshwane metro area. "The major disruption these closures will surely have on accessibility and routes linking different parts of the city with each other must be considered. My prediction is that we will only shift the problem of traffic congestion in the inner city to other parts resulting in worse traffic problems," he said.

Pretoria News

15 April 2013

Affordable property is key to wealth creation, says study


Click HERE to visit us on Facebook

Affordable property is key to wealth creation, says study

The provision of affordable housing in the so-called gap market in South Africa not only resulted in improved welfare and social cohesion, but was also an important facilitator of opportunities and wealth creation, according to a new study.



The research, conducted by a team led by UCT associate professor Francois Viruly, found that those who obtained homes in this sector moved beyond viewing them as a mere shelter but saw them as an asset, and the appreciation in the value of these assets stimulated entrepreneurship, job creation and access to higher levels of education.

Soula Proxenos, the managing partner of International Housing Solutions (IHS), a global private equity investor that pioneered the financing of affordable housing projects in South Africa with a total value of almost R8 billion to date and commissioned the research, said housing in the affordable sector enabled a broadened role and became an asset that appreciated, stimulated economic activity and created wealth.

"In the US it is the singlebiggest source of funding for new business creation. The units play a role as a financial asset and a majority of those interviewed during the research believed the value of their assets had indeed increased," she said.

Viruly said increasing entrepreneurship in South Africa through affordable housing would also lead to increased employment as entrepreneurship had been shown to be a key contributor to job growth globally and had been the primary source of job growth in the US for the past 30 years.

Viruly's research also supported government findings that massive urbanisation was adding to the housing backlog, which includes the gap market.

Affordable housing or the gap market refers to households with an income between R3 500 and R18 000 a month, who earn too much to qualify for the government's low-cost subsidised housing and too little to afford the cheapest standard private sector houses or to qualify for bonds.

Soula Proxenos and Francois Viruly at Aurora Village in Belhar, Asrin Property Developers' project with International Housing Solutions

Among the major reasons listed by respondents for moving to an IHS-funded development was a desire for better access to their places of work, an improved and safer environment, proximity to schools and financial considerations.

In addition, 72 percent of respondents said their quality of life had improved while only 3 percent believed their life had worsened to some degree.

Proxenos said housing was like a ladder and if there were rungs missing, the ladder was broken.

"Creating housing stock in the gap market gives previous RDP households housing to move up to," he said.

Proxenos stressed that the government could not fix the whole housing ladder and the gap market was ripe for private sector development.

Business Report

04 April 2013

Tshwane switches to prepaid electricity for all properties


Click HERE to visit us on Facebook

Tshwane switches to prepaid electricity for all properties


PRETORIAThe City of Tshwane is doing away with meter readers as it intends to shift all electricity users in the city to pre-paid meters within the next two years.

Not only will consumers have more accurate consumption figures and no more electricity bills, the city will save more than R5 billion in billing, administration and debt collection fees.

Yesterday, the city launched the R7bn Security of Revenue Project which will see the installation of 800 000 pre-paid smart meters in every household, business and public building at no cost to the consumer.

Jason Ngobeni, city manager, said the smart meters would give the power back to the people. "People will be able to control their own electricity consumption," he said.

Consumers can control the amount of money spent on electricity each month because they can choose how many electricity units to upload.

There will be no increase in electricity fees when switching from the current system to the smart metering system.

Service fees for electricity on the current system range between 27 and 30c a rand. On the smart meter system, this fee is expected to decrease to 19.5c a rand.

The City of Tshwane will collect revenue upfront, with the aim of improving the city's liquidity.

Andile Dyakala, chief financial officer of the City of Tshwane, said the city, on average, received bill payments 131 days after issuing them. "We have to pay Eskom 15 days after buying the electricity but we wait much longer to receive the money from the consumers," he said.

Executive mayor Kgosientso Ramokgopa said the new metering system would improve the flow of money to the city. "We can bank on money received upfront from consumers and use it to improve social infrastructure," he said.

Ramokgopa said the new system would increase job opportunities in the city. The factory producing the meters will have to be within Tshwane to benefit the city's job seekers, he said.

Electricity tariffs, on the new system, will differ depending on the time of day - during peak periods electricity will cost more than offpeak periods.

"Hopefully this will encourage people to restructure their electricity usage times and reduce the impact on power grids during peak times," said Dyakala.

"This might change people's behaviour if they realise they cannot just consume, consume, consume.

"They will have to manage their consumption," said Ramokgopa.

The smart metering system will be implemented from October 1 and Ramokgopa will be the first to have a meter installed in his home.

"This system will benefit the totality of residents in the city," said Ramokgopa.

Pretoria News

03 April 2013

Pretoria court to receive a facelift after fire

I have posted this because it has long been a source of irritation for me.  Although I virtually never stride the passages of the Magistrates Court anymore, on the rare occassions that I find myself there, the prefab offices squeazed into the "new building" to accomodate the activities that used to be housed in the "old building" are an eyesore and inadequate for the efficient dispensing of justice.

Three years later and they are nearly in a position to issue the construction tender.  You must be kidding!?!

I understand that it is a heritage site BUT ... three years later and they have not even issued the tender yet (let alone granted the tender and commenced/completed construction).

Anyway, let's hope that the delay results in a beautifully restored building much like they achieved with the Palace of Justice (on Church Square) about 10 years ago.

Gareth Shepperson

Click HERE to visit us on Facebook

Pretoria court to receive a facelift after fire

The historic old Pretoria Magistrate's Court, which was destroyed by a fire in 2010, will soon receive a facelift to restore it to its former glory.


An aerial view of the old historic building of the Pretoria Magistrate's court that was destroyed by a fire in October 2010.


Restoration, due to have started in January, was delayed due to a procurement process, and consultants, specialising in the restorations of historic buildings, were appointed in November, the Department of Public Works has said.

Departmental spokesman Thami Mchunu said the project design process is expected to be complete at the end of next month.

"Once the design process has been completed, a tender for the construction work will be issued," he said.

The restoration, estimated to cost about R100 million, will have the building restored to its original state as it was earlier declared a national heritage site. This means that the building, by law, must be restored to its original form unless compelling reasons or circumstances state otherwise.

Mchunu explained due to the nature of the restorations, specialised contractors including technical professionals such as architects specialising in heritage buildings will be working on the building. The renovation is expected to take about 18 months.

A fire - caused by an electrical fault in one of the ceilings in October 2010 - destroyed the building, except for the two lower levels and the building's outer marble-clad structure. Fortunately firefighters prevented the fire from spreading to the adjacent "modern" building.

Pretoria News earlier reported that although the building belongs to the Department of Justice and the repairs are the responsibility of that department, the funds were allocated by the public works department.

Professor Albrecht Herholdt, a member of the National Cultural Heritage committee said restoring buildings of national heritage is not an easy task but the end result is always worth the effort. He explained than in many instances where old historic buildings were completely destroyed, photographs had to be used for purposes of reconstructing the building as before.

Several plans to accommodate staff housed in the old building had to be made after the fire. Four criminal courts were relocated to the Centurion Municipal Court building, the Municipal Court in Visagie Street and Court 62 at Pretoria Central Prison.

Because of a lack of space and facilities, the entire domestic violence section was relocated to the Municipal Court, in Visagie Street, and the rest of the family law services to the first floor in the unburned part of the building.

A number of criminal courts were combined and several magistrates' offices were converted into courts to deal with family and private law matters.

These "office courts" are primarily used in matters dealt with in camera. A further 44 dry-wall offices and 22 dry-wall storage areas had been erected in the passages next to and in front of all courts for administrative support staff.

Pretoria News

Pretoria court to receive a facelift after fire

I have posted this because it has long been a source of irritation for me.  Although I virtually never stride the passages of the Magistrates Court anymore, on the rare occassions that I find myself there, the prefab offices squeazed into the "new building" to accomodate the activities that used to be housed in the "old building" are an eyesore and inadequate for the efficient dispensing of justice.

Three years later and they are nearly in a position to issue the construction tender.  You must be kidding!?!

I understand that it is a heritage site BUT ... three years later and they have not even issued the tender yet (let alone granted the tender and commenced/completed construction).

Anyway, let's hope that the delay results in a beautifully restored building much like they achieved with the Palace of Justice (on Church Square) about 10 years ago.

Gareth Shepperson

Click HERE to visit us on Facebook

Pretoria court to receive a facelift after fire

The historic old Pretoria Magistrate's Court, which was destroyed by a fire in 2010, will soon receive a facelift to restore it to its former glory.


An aerial view of the old historic building of the Pretoria Magistrate's court that was destroyed by a fire in October 2010.


Restoration, due to have started in January, was delayed due to a procurement process, and consultants, specialising in the restorations of historic buildings, were appointed in November, the Department of Public Works has said.

Departmental spokesman Thami Mchunu said the project design process is expected to be complete at the end of next month.

"Once the design process has been completed, a tender for the construction work will be issued," he said.

The restoration, estimated to cost about R100 million, will have the building restored to its original state as it was earlier declared a national heritage site. This means that the building, by law, must be restored to its original form unless compelling reasons or circumstances state otherwise.

Mchunu explained due to the nature of the restorations, specialised contractors including technical professionals such as architects specialising in heritage buildings will be working on the building. The renovation is expected to take about 18 months.

A fire - caused by an electrical fault in one of the ceilings in October 2010 - destroyed the building, except for the two lower levels and the building's outer marble-clad structure. Fortunately firefighters prevented the fire from spreading to the adjacent "modern" building.

Pretoria News earlier reported that although the building belongs to the Department of Justice and the repairs are the responsibility of that department, the funds were allocated by the public works department.

Professor Albrecht Herholdt, a member of the National Cultural Heritage committee said restoring buildings of national heritage is not an easy task but the end result is always worth the effort. He explained than in many instances where old historic buildings were completely destroyed, photographs had to be used for purposes of reconstructing the building as before.

Several plans to accommodate staff housed in the old building had to be made after the fire. Four criminal courts were relocated to the Centurion Municipal Court building, the Municipal Court in Visagie Street and Court 62 at Pretoria Central Prison.

Because of a lack of space and facilities, the entire domestic violence section was relocated to the Municipal Court, in Visagie Street, and the rest of the family law services to the first floor in the unburned part of the building.

A number of criminal courts were combined and several magistrates' offices were converted into courts to deal with family and private law matters.

These "office courts" are primarily used in matters dealt with in camera. A further 44 dry-wall offices and 22 dry-wall storage areas had been erected in the passages next to and in front of all courts for administrative support staff.

Pretoria News