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I Issue: November
2004 I Editor: Berry Everitt I |
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Your Area Specialist:
Chas Everitt International
sales agents have all the latest market information
regarding local property values at their fingertips
– and are committed to the highest standards of
personal service when it comes to selling your home.
In addition, the Chas Everitt International property
group offers you, the homeowner, the best possible exposure
for your property in both national and international
markets. So if you are thinking of selling your home,
call your nearest Chas Everitt International office
today for the name of your local area specialist - or
visit www.chaseveritt.com
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Every month the Property
Signpost Newsletter will be issued to all our
subscribers, filled with real estate information to
help you make an informed decision, whether you are
buying or selling a property.
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Contents
1. Welcome By Publisher
2. Time to take another look at gearing
3. Getting over
"buyer's block"
4. Dealing with damp
5. What happens when sales fall
through
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1.
Welcome By Publisher
I don't know about you, but
the onset of summer always puts me in a holiday mood.
And what better place to really get into a relaxed
frame of mind than Mauritius, the Indian Ocean island
whose best known export is the saying "No Problem"
?
Well, that's where we're headed
for a few days later this month, with all the top
Chas Everitt International agents, for our annual
conference and awards ceremony.
We'll be celebrating an enormously
successful year, with the expansion of our franchise
network to forty one branches, some spectacular sales,
and a triumphant European Expo Tour as the highlights.
And we'll be planning for the year ahead, tapping
our top performers for ideas on making our service
to clients even better. After all, there's no such
thing as a free lunch (or trip to Mauritius).
Meanwhile, I'm sure you'll find
this month's newsletter so interesting you won't even
envy us our time out in the sun…
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2.
Time to take another look at gearing
Low interest rates and rapid capital appreciation
in recent years have boosted the importance of investment
in property for anyone building up a portfolio to
ensure a stable income after retirement.
The property market's resilience has made it to be
a sound counter to lower returns from other forms
of investment, and there has been a strong increase
in the number of South Africans buying houses, flats
and holiday accommodation for rental purposes.
One of the biggest factors in this increase has been
the ability to leverage the purchase of property through
the availability of mortgage finance, with a sharp
decline in interest rates since last year having increased
the affordability of monthly repayments.
But buyers should not lose sight of the savings to
be made by shortening their bond term - especially
if they are nearing retirement. Indeed, they should
be taking much more advantage of the current low rates,
and bond repayments, to achieve these savings.
On a bond of R500 000, for example, the current minimum
monthly repayment at the "base" interest rate of 11
percent is R5160. But by paying just R525 more a month,
investors can shorten their bond term to 15 years.
- and save more than R215 000.
So, if you are 50 years old and working towards carefree
retirement with your investment properties paid off
so that most rental income received flows into your
income stream, now's the time to put down the biggest
deposit possible, pay off the mortgage early and get
the compound interest factor working for you, instead
of against you.
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3.
Getting over "buyer's block"
The purchase of a home is one of any
family's most important financial decisions and it is
therefore difficult to put a time limit on the search
for the perfect property.
But the search CAN go on too long as
the buyer tries to mesh all the advice he has been given
by well-meaning friends, relatives and perhaps competing
estate agents with his own needs and desires and the
reality of what he can afford.
And that can lead to a state of inertia,
or "buyer's block" - where a decision becomes impossible.
The answer for buyers who have reached
this stage is to go back to basics: Decide what is absolutely
essential in the new home, what features are merely
desirable and what is the top price that can be paid.
Then carefully study estate agents'
listings in your preferred area. This will give a good
indication of the availability of the type of house
required and within your price range. Or it may signal
that your search area should be widened to include neighbouring
suburbs where ruling prices are lower.
Visit only those showhomes that conform
to your "essentials" list and are within your price
range, and ask agents in your chosen area whether they
currently have any others on their books that meet your
criteria.
Set yourself a viewing time limit and
be prepared to make an offer within that time. Do not
be afraid of "missing out" on something better that
might come on to the market next week, next month or
next year. As long as the home you choose meets your
needs and is well-positioned and well-maintained, it
will be a good buy.
And while a home purchase should never
be rushed, remember that indecision in a strong market
gives other buyers the chance to swoop in and grab the
home that might have been your best choice.
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One of the most common problems to
bedevil homeowners, particularly in high rainfall
areas and at the coast, is the presence of damp.
It can cause a musty smell to pervade
cupboards, rooms or even a whole house, and in severe
cases cause paint and plaster to flake from walls
and tiles to lift in showers, bathrooms and kitchens.
Unless treated properly it can be
a continuing source of discomfort to the occupier,
and will be a severe deterrent to potential tenants
or buyers of the property.
Building experts have calculated that
drying construction materials in a new house can release
up to 2250 litres of water in the first year, and
in older homes the problem can stem from rising damp
through the foundations or leakage through the roof,
around chimney flashings, ill-fitting window or door
frames and, most commonly, from blocked and overflowing
guttering.
The answer in many cases, particularly
for coastal holiday homeowners, can be as simple as
increased ventilation. Open windows and doors can
quickly clear a house of a musty smell, and in other
cases, the prevention of leakage, the installation
of an extractor fan to get rid of condensation in
a bathroom or kitchen, and the application of a damp-proof
coating under exterior paintwork can eliminate the
problem.
Serious rising damp from the foundations
should of course be left to the experts, but the homeowner
can ensure that downpipes from the gutters direct
water away from the house and that garden runoff does
not collect at weak points.
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5. What happens when
sales fall through
It is unusual for a
property deal to collapse if the purchaser has made
a sound assessment of what he needs and can afford in
choosing a new home and has worked closely with an experienced
and qualified estate agent.
But personal circumstances
can change unexpectedly, and latent defects do sometimes
come to light before transfer is registered, so it is
important to know how to back out of a deal - and what
the consequences are likely to be.
Of course the "cooling-off"
clause in the Alienation of Land Act, which covers residential
property priced at under R250 000, gives buyers who
have changed their minds about the purchase the chance
to withdraw from the contract within five working days
of signing the offer to purchase, provided the seller
is informed of their decision.
In the case of a more
expensive property, however, a "change of mind" is simply
not a good enough reason to refuse to go ahead with
the transaction, and will usually entitle the seller
to demand 'roukoop' - a penalty equal to a portion of
the purchase price - from the reluctant buyer.
Buyers, whose family,
work or financial circumstances suddenly change, though,
may encounter understanding and even sympathy from a
seller, if they are quick to communicate the change
and give the seller's agent time to re-open negotiations
with other potential buyers who expressed interest in
the property.
In the case of a latent
defect discovered before transfer - perhaps by a buyer
who has taken early occupation of the property - it
is advisable for the buyer and seller to re-negotiate
the price of the property or to reach an agreement on
payment for repairs. Failing this, they could become
embroiled in a lengthy, and costly, litigation that
ultimately benefits neither party.
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