JAWITZ PROPERTIES SWELLENDAM

SWELLENDAM PROPERTY NEWS

2011-08-29T20:42:00.000+02:00

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Raimond Lamprecht, principal of the new Jawitz Properties franchise in Swellendam says there is good value to be found in in the town but that most sellers are still having to accept offers 10% to 15% below their asking prices.

"There's been interest lately from foreigners and up-country buyers who are drawn to the area because of its scenic beauty and its proximity to Cape Town and George. Families regard it as a safe environment in which to raise children, and are attracted by the reputable schools and the quality of life. And of course the fact that Swellendam is the third oldest town in SA adds an historic flavour," he says.

Currently, growth is mostly taking place at the lower end of the market, that is the R400 000 to R750 000 range.

At the upper end, there has been much less activity and some properties have been on the market for more than a year. "Having said that, though, we have recently sold two up market properties for R2,175m and R1,950m respectively in less than a month," Lamprecht notes.

In the middle sector of the Swellendam market, buyers can expect to pay around R1m for a three to four-bedroom house, and around R850 000 for a sectional title unit in a retirement village.

*For more information contact Raimond Lambrecht on 082 5143914 or 082 377 1953 or visit our website at www.overbergprop.com or www.jawitzswellendam.co.za

HOUSING FOR THE GAP MARKET

2011-07-15T19:17:00.002+02:00

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The property industry’s next boom may come from affordable housing.
Housing for the so-called gap market (households earning between R3 500 and R15 000 per month) has until now been seen as risky business for developers and financial institutions.
However, as the implications of the massive backlog hit home, industry players are falling over themselves to take part in the segment.
The gap market traditionally earns too much to qualify for an RDP home, and too little to qualify for a home loan. It is estimated there are between 600 000 and 800 000 homes needed for this market.
According to Rob Wesselo, the country manager for International Housing Solutions (IHS), the affordable housing market is the only segment showing attractive growth in the property industry. IHS is a global private equity firm which partners with housing developers.
The IHS SA Workforce Fund raised R1.9bn available for investment in SA real estate – with a focus on the affordable housing market. The fund aims to provide at least 35 000 affordable units for sale and rent by 2018.
According to IHS, the government and some private investors supply only about 20 000 units per year, not enough to make a dent in the backlog.
“You don’t see business queuing for the commercial or industrial sector, but there are queues for this segment because there is such a shortage.
“It’s clear there’s a need. There’s been a perception that people in this market don’t pay rent, but if your asset management is good this can be an excellent investment,” said Wesselo.
Banks have also come to the party. FNB’s housing finance unit was created to find ways of financing homes for the lower income market. “Research told us that only about 15% of the country’s households had access to home loans,” said the unit’s CEO, Marius Marais on Wednesday.
FNB’s Smartbond offers 100% home loans to households earning between R3 500 and R15 000 per month.
Despite the recession, FNB’s profit from end-user finance in this market grew by 84% in the 2009/2010 financial year.
“We see this as a great market; there’s massive demand and a proven business model,” said Marais.
According to Marais, despite the push by government to address the need for housing for the gap market, it’s in the group’s interest to do everything in its power to keep defaults as low as possible.
This includes encouraging clients to buy at fixed interest rates (a rise in interest rate can decimate a household earning under R10 000), and compulsory formal homeowner education.
If managed correctly, this market segment should not be seen as more risky than others, said Marais.
Absa Home Loans also offers an affordable housing product. The 110% MyHome loan offering covers bond costs (about 4% of the total purchase price). Borrowers also do not have to pay a deposit.
On the developer front, Absa launched Diliculo Investments, an affordable housing fund with over 2 000 units in its portfolio, in 2007. The fund plans to own and manage close to 4 000 units by the end of this year.
Listed companies have lauded the affordable housing market for propping up its earnings during the recession. Alterations and home improvements groups like Italtile and Cashbuild reported the lower end of the market is to form a bigger part of its focus.
Cashbuild CEO Pat Goldrick said last week the group's focus on rural communities means it can take advantage of the growth spurt the affordable housing market is set to experience.
He said home owners in the lower income bracket will want to improve and extend their homes.
"Everybody wants to get a share of this market," he said.
“This is a very exciting place to be right now, and there’s still so much left to do,” said Marais.

CONSUMER PROTECTION ACT IMPACT ON PROPERTY TRANSACTIONS

2011-06-24T22:25:00.000+02:00

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The new Consumer Protection Act (CPA), which came into effect on 1 April 2011, could see property sellers and estate agents exposing themselves to great risk should they attempt to market and sell a property without letting a buyer scrutinise all relevant documentation prior to the signing of a sale agreement.
Implications on property transactions
Implications for property sellers
Sellers are quite often in a rush to sell their properties, but do not consider the impact of the costs of repairs related to plumbing, beetle damage, electrical faults and full disclosure of the condition of their property.
Property buyers may attempt to hold sellers and their estate agents responsible for defects or non-disclosure of property faults, even months after ownership has passed to the buyer. Sellers now have to ensure that properties being sold are inspected and evaluated by accredited or registered service providers, which can be a time-consuming and laborious exercise. The results of these inspections have to be made available to potential buyers, giving them an objective description of faults or defects to the property. The buyer has to agree to purchase the property in that condition, should they wish to, or can request that the seller repair these faults before the buyer signs the deed of sale.
Implications for property buyers
Buyers, who are usually led by the emotions of buying a new home, often do not focus on the administrative details required to finalise a transaction. They are generally unaware that they are able to obtain comprehensive due diligence information on the property on which they are to spend thousands or millions of rands.
Buyers now have the right to information that will help them to make an informed decision about the property they are planning to buy. However, they have just as much responsibility to request the required documentation from the seller as the seller has to obtain and present it to them. Once presented with all the facts the buyer can then decide to buy the property as is, ask the seller to adjust the asking price or ask the seller to repair the faults to the property and cover those costs.
Having all available information pertaining to the property at hand also helps buyers to strengthen their applications for a home loan. The structural condition and construction of a property, according to the approved building plans (which are included in the information that buyers should have access to), are important factors considered by a bank before granting a loan.
Implications for estate agents
Sale agreements must be prepared in simple and understandable language. A buyer with average comprehension skills and education must therefore be able to understand the sale agreement presented to him for signature. In many instances, the "voetstoots" clause will also no longer be applicable as the term "voetstoots" must be explained in simple and clear language to the buyer.
Property Transaction Kit
A new service, aimed at protecting property buyers, sellers and estate agents equally during the course of a property transaction, addresses – and ultimately provides – a transparent process in purchasing a property.
Property Transaction Kit (PTK), the brainchild of conveyancing attorney Meyer de Waal, was developed in consultation with key industry associations and service providers, and offers a structured process through which to gather required compliance material in order to ensure a smooth transfer. The service is available to buyers, sellers, estate agents and property attorneys, and enables them to either compile or have secure online access to all the documentation and certificates of compliance related to the sale of a property.
"Once a seller registers for the service the PTK team will access a database of accredited service providers to source all the relevant documentation and issue certificates of compliance pertaining to the property," says De Waal. "The documents are then loaded onto a virtual 'property vault' on the PTK portal. There the seller, his estate agent, buyer, attorney or bank can securely access the information.

"The seller can, after viewing the various reports, either decide to improve the property’s condition or simply share the documentation with the potential buyer so as to disclose the true condition of the property. Potential buyers can also request access to this comprehensive report to help them decide whether or not to put in an offer on the property."
De Waal explains that, for years, the lack of strong consumer protection laws have left ill-informed property buyers at the mercy of sellers and estate agents who often sold properties voetstoots. The voetstoots clause used to protect the seller from defects that the buyer could identify during a viewing of the property, but not against defects that the seller did not know about and thus could not disclose to the buyer.
Without knowing the true condition of the property many buyers had to fork out a substantial amount to repair their homes, resulting in serious implications on their budget and their ability to meet other financial obligations after taking ownership. In addition, most buyers do not have the knowledge or experience to request relevant information about a property in which they’re interested and seldom ask for even basic documentation such as a copy of the title deed, current and approved building plans or zoning certificates.

FORREIGNER LAND OWNERSHIP

2011-06-24T22:13:00.000+02:00

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South Africa, whose land tenure system has been in the past described as a ticking time bomb, is moving to put controls on foreign access to the resource.
The government is soldiering on with plans to restrict foreign land ownership in the country and to prescribe conditions for land use to keep South Africa's prime land — relatively cheap by international standards — from being snapped up by foreign buyers who can then push prices higher.
With the country's land reform programme based on the willing-buyer/willing-seller model, it is in the government's interest to keep prices down.
But even with prices said to be lower than international standards, the government has admitted it cannot meet its 2014 land redistribution targets as white farmers price the resource out of the state's reach.
Rural Development and Land Reform Minister Gugile Nkwinti has said rather than preventing foreigners from owning land, a policy on 'precarious tenure' for land ownership by foreign nationals would be developed 'to determine the basis on which foreigners can lease or use land'.
Nkwinti, tabling his budget vote in Parliament recently, said the Land Protection Bill would be submitted to the cabinet this year.
President Jacob Zuma announced in January the state was reviving its plan to limit foreign land ownership.
This initiative stalled after a government probe in 2006 found only about five percent of land in South Africa was foreign owned.
It emerged last month that Nkwinti plans to ask the cabinet to permit more land claims by black South Africans who lost their property before 1913.
Legislation providing for land claims, which has cost the fiscus billions of rand, had as a cut-off date for restitution the promulgation of the 1913 Land Act, which removed the right of black South Africans to own land in more than 80 percent of their own country.
The procedurally complex claims process is administered by the Land Claims Commission, which has to battle with bureaucratic headaches that have made land transfers a nightmare for the black majority.
Analysts say it has largely benefited those forcefully removed by apartheid laws from urban areas, rather than rural communities.
Liberal economists also claim that the process discourages investment in agriculture, implying that land should not be transferred from the minority to the majority.
The restitution of claimants is a separate programme from the government's drive to redistribute farmland to black South Africans through the problematic willing-seller/willing-buyer policy.
Deputy Rural Development and Land Reform Minister Thembelani Nxesi told South Africa's Parliament last week that the government wanted to guard against the danger that South African prime land would become more expensive due to an influx of foreign buyers.
'We need to make it very clear that these measures are in no way motivated by anti-foreigner sentiment,' he said.
Instead, the government planned to encourage foreign investment in land in a manner consistent with 'national interests'.
Nxesi said the policy would endeavour to thwart 'undesirable' land use practices such as prime agricultural land being 'converted into game farms and golf estates', as was happening in parts of the Western Cape and Eastern Cape.
He warned those in the real estate industry who rejected any form of regulation which reduced their profits that they would not prevail.
He said Australia had introduced legislation seeking to control foreign purchases of real estate, while encouraging investment in building new housing, thus benefiting its building industry.
The South African Property Owners Association said afterwards that while it was sensitive to the need to redress past injustices in the property market, the future performance of the economy was connected to the country's ability to attract foreign direct investment.
Its CEO, Neil Gopal, called for a predictable and 'nondiscriminatory' regulatory environment for foreign and domestic enterprises, and regulations that were in accordance with international law.
Gopal said an absence of undue administrative impediments to business, including an impartial system of courts and law enforcement, would be 'ideal'.
The land hungry, however, say such language has been used in the years following the fall of apartheid to protect the tenure systems that were created by the race-based system and only systematic affirmative action that takes into account that today's inequalities are discriminatory can result in any meaningful changes for the poor majority.
A three-tier system of land tenure that sought to restrict foreign land ownership and also suggested limited freehold for South Africans was proposed last year in a green paper on revising the policy for land reform and rural development.
The resultant furore caused Nkwinti to separate land reform from rural development and to produce two green papers. Both, he said, are now ready for debate by the cabinet.
Nkwinti also told Parliament that R1.3 billion had been allocated 'for making all land reform farms fully functional and 100 percent productive' through his department's recapitalization and development programme.
'This should cover an additional 387 farms, and revitalize 27 irrigation schemes, which have already been identified across the country,' he said. Nkwinti also indicated that another aspect of the review of land reforms - drafting legislation to protect the rights of farm dwellers and farm workers - was on track.
'The Land Tenure Security Bill 2010 seeks to promote and protect the relative rights of persons working and residing on farms, as well as those of farm owners,' he said.

RENTAL DEMAND MORE THAN LETTING

2011-05-23T17:25:00.001+02:00

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'Demand outstrips supply for letting'

In the first quarter of this year 25 percent more rentals were concluded in the Cape Town metropolitan area than in same period last year, with demand for lower-to-mid priced rentals outstripping supply, said Francois Venter, Jawitz Properties regional sales manager for the Western Cape.

"Studio, one-and two-bedroom townhouses and apartments priced between R5 000 and R10 000 are the most popular, so buy-to-let investors should focus on this bracket.

"This means looking at properties worth anywhere from R500 000 to R1.5 million," he said.

Demand was also strong for rented houses priced from R10 000 to R15 000. Part of the supply was from people entering the rental market because they could not afford bonds and other costs of owning homes, but were not able to sell their homes at the right price at present.

"Renting can often be cheaper than paying off a bond, so some sellers are opting to move out of their homes to more affordable, rented properties, and then let their homes rather than selling and accepting low offers.

"In addition, many people are obliged to rent instead of buying from the outset. Getting finance to buy a home is still difficult. Not only are banks' lending criteria still stringent, in most cases they also want deposits of at least 10 percent.

"With the high costs of electricity, petrol and food prices, not many potential buyers can afford the up-front cost of buying a home which, in addition to a deposit, includes transfer and bond costs and often renovation costs as well."

Venter said the top end of the rental market was still buoyant, with demand often coming from companies relocating executives. But pricing was key, and property owners needed to ensure they did not turn prospective tenants away with unreasonably high rents.

Jawitz Properties Press Release

MORE FEMALE BOND APPLICATIONS

2011-05-11T22:00:00.000+02:00

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The number of single female homebuyers in South Africa has risen significantly over the last four years, on the back of an increase in single person households and as women gain better positions in the workplace.

The ratio of women to men in single person home loan applications to ooba has increased from 36.53% in January 2007 to a current level of 46.94%. In total, single person applications presently make up 49.65% of applications in comparison to the 50.35%of joint applications.

This is a very positive development for the South African property market. The South African constitution has enshrined equality so it is pleasing to note that the dynamics of the historically male dominated property market has evolved. A steady increase in the number of women in the workplace, particularly those occupying more managerial top level jobs which command higher income earnings, has helped to shift the balance towards a more equal ratio among homebuyers.

The fact that so many more women are part of the job market has had an impact on the male/female home loan application ratios. Now that females are more focused on creating their own wealth portfolio, credit, such as home loan finance, is far more easily accessible to them individually. As a result, purchasing property has become an ideal long-term wealth creation goal for women as much as men.

The record 30 year low interest rate environment has also certainly made property purchasing more affordable for single women, however, there are some important key factors that any buyers, male or female, need to bear in mind when looking for a home.

Firstly, women looking to enter the property market should ensure that they have a sufficient deposit to put down. Besides improving your chances of getting a home loan approved, a deposit will result in a more favourable bond rate, which will save you in interest over the term of the loan. As a home loan is paid back over a long period, generally between 20 and 25 years, even a small reduction in the interest rate on your bond, can save you thousands in interest payments over time.

A positive credit profile and a stable employment history will assist females when applying for home loan finance. Employment history is very important as it reflects a pattern of stability and income. For most lenders a consistent income stream is key when working out how much one can borrow. Lenders will also want to look at your credit history, so that they can see a historic pattern of borrowing and repayment as well as how you have managed your bank accounts and other credit facilities.

When looking for a new home it is strongly advisable that you are pre-qualified, as this will give you a good sense as to the value of the property that you will be able to purchase.

The pre-qualification process can also pick up credit issues on your record that would need to be fixed before you can formally apply to a bank. This process not only streamlines the home buying process, but also ensures that the buyer is able to negotiate from a position of strength.

CLAIMS BY PURCHASER SPENT ON PROPERTY BEFORE TRANSFER

2011-04-06T20:31:00.001+02:00

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An Appeal Court ruling (in the case Solvista Investments vs Sasol Fibres) which clarifies the message that the liability to pay all rates and taxes and "other outgoings" passes to the purchaser on the date of transfer but does not entitle him to claim for expenses paid out prior to transfer.

In this case the purchaser claimed a large sum for the costs of security, cleaning, maintenance and protection apparently spent in the period between the signing of the deed of sale and transfer.

It often happens that a purchaser will be given permission to occupy the premises prior to transfer, and in most cases will be charged an occupational rental for this. However, any money ("other outgoings") that the purchaser spends on the property during this period is for his account, even though he takes complete ownership only after transfer.

In the current court case, the judge did not accept the claim that the money laid out should be refunded even though the buyer had apparently thought that would happen from the time he entered into negotiations.

RESPONSIBLITIES OF TRUSTEES

2011-04-06T20:24:00.000+02:00

The laid-back approach to a trustee's responsibilities can be very harmful to a body corporate.

The Sectional Titles Act recognises that the trustees of sectional title bodies corporate, unlike the directors of independent companies, are unpaid volunteers and may lack the full experience required for their positions. For this reason it indemnifies trustees against prosecution for what are clearly errors but still retains its full powers should they try to defraud the scheme or act with gross negligence.

Although protected in this way, sectional title trustees are responsible for the financial health of their schemes, the care and maintenance of its buildings and facilities and the welfare and security of their members.

It is all too easy for a trustee to take the attitude, You were desperately short of volunteers so I have allowed myself to be elected - but don't expect too much of me.

This laid-back approach to a trustee's responsibilities can be very harmful to a body corporate.

There will be times in a trustee's life in which he had to be proactive and, possibly, hard. He has to stand up against members who are letting the side down by not paying their levies or by behaving in a way that is distasteful to other members and this can be uncomfortable if the trustee is living in the same scheme as those who need to be disciplined. It often makes being a trustee unpopular - but that is something they have to accept.

Many trustees have come from backgrounds (e.g. teaching) where they had no or limited chances to acquire financial, accounting or legal knowhow.

This does not in any way alter the fact that they have to get to grips with the sectional title scheme's accounts, if necessary calling in an accountant to help them.

A "get-involved" message has also to be given to body corporate members: if they do not attend Special and Annual General Meetings, they have only themselves to blame if things go wrong.

Not long ago the slackness of members and their trustees in a certain scheme allowed a managing agent (who was later declared bankrupt) to misappropriate funds and to accumulate R500,000 in municipal charges arrears. Had the members attended the AGM and discussed the accounts or taken them to a creditable auditor, the problem need never have arisen.

One of the trustees' most important tasks may be to appoint a good managing agent.

Here experience has shown that it can be unwise to select an estate agent, even though he may have been highly effective as a sales person.

Good sales people are not usually good administrators. They often dislike clerical and figure work. The ideal managing agent is an accountant with a good dose of common sense with a sound understanding of the Sectional Title Act for legal matters.

CHANGES IN THE VOETSTOOTS CLAUSE - OFFER TO PURCHASE

2011-04-06T20:18:00.000+02:00

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Property developers who have in the past delivered sub-standard products and gotten away with it, relying on the protection of the "voetstoots" clause, will no longer have that shield, in terms of the new Consumer Protection Act (CPA).
This clause, which has been a part of business and contracting since time immemorial, is a common law principle which protects the seller by excluding his liability for latent defects. In terms of common law the seller will be responsible for latent defects in the absence of the clause. In the past some unscrupulous property developers have hidden behind the voetstoots clause, by saying for instance that there was no defect when the property was sold, and therefore any defect which becomes apparent later is not for his account.

Michelle du Plessis of legal firm Deneys Reitz says the implication of the CPA on the real estate sector is that if a property reveals a material defect within six months of transfer, the purchaser can choose to either return it and get a refund, to insist that the seller repair the defect, or that the seller replace it with another property. In other words, a seller can be forced to take back a property up to six months after transfer.

It is important to note that the CPA does not apply to all sales of property. A one-off sale, for example, will not fall under the CPA and therefore parties to such sales are free to continue using voetstoots clauses. "It is definitely a good idea, if you're a seller, to include a voetstoots clause in a deed of sale," Du Plessis says.

Du Plessis says there are exceptions to the rule: "If the purchaser has been expressly told that a property is offered in a specific condition and he accepts it in that condition, he can't later come back and allege the goods are defective or not suitable for his purposes". Therefore, if a purchaser has taken note of a defect in a property, he cannot change his mind three months later and tell the developer he no longer finds it acceptable.

She explains further: "The public should be made aware that if they buy a property from a developer, the developer can no longer hide behind a voetstoots clause. If there is a material defect in the product delivered, the consumer has rights. Developers will have to take stricter control over the entire construction process and also make sure they build a good product, otherwise they might find themselves being forced to take back that property and refund the purchaser."

The section in the Act which gives purchasers the right to return defective goods states that a purchaser/consumer has the right to receive goods that are reasonably suitable for the purpose for which they are generally intended, are in good working order, of good quality and defect-free. Du Plessis, says the term "defects" in that portion of the Act, is specifically limited to material imperfections in the manufacture of the goods which make it less acceptable to the purchaser. The section cannot be used against a seller / developer if the defect is minor, like a cracked tile or poor paintwork.

"The section specifically says it doesn't matter if the defect is latent or patent (obvious) or if the purchaser could have detected it before delivery... the purchaser is still entitled to expect good quality, defect free goods," Du Plessis said.

She says although the provisions of the CPA may appear harsh in how they will affect property developers, we must remember that we are all consumers, and will all ultimately benefit from the Act too.

SELLING PROPERTY WITH ARREAR MUNICIPAL ACCOUNTS

2011-04-01T17:37:00.003+02:00

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A recent high court case, says Sandy Walsh, head of training and education for the Western Cape Institute of Estate Agents, has highlighted again the questions that arise when a property owner who is in arrears on his rates and services payments to his municipality tries to sell the property.
In the case to which Walsh was referring, Real People Housing (Pty) Ltd owed the City of Cape Town R21 345 on one of its properties. The last two years arrears were estimated at R3 677.
Real People then paid the smaller sum and asked for a rates clearance certificate (without which they could not legally sell the property). Real People pointed out that, as the law now stands, it appears that a seller has only to pay the last two years rates.
The municipality, however, refused to issue a certificate until all arrears were paid.
When Real People took the case to the courts, the court ruled that, because the last two years charged had been paid, the clearance certificate had to be issued – and the judge criticised the municipality for “allowing” the larger debt to build up.
“The questions which now have to be asked,” said Walsh, “are, can the new owner be held responsible for the previous owners’ debts and/or does the municipality lose control of the debt situation by having the property change ownership?”
These questions, said Walsh, are relevant today in SA because 40% of our municipalities are now in debt with arrears that far exceed their anticipated income and these arrears, which amount to the staggering figure of over R62 billion, are largely responsible for the precarious financial position of many municipalities and at least in part responsible for their poor delivery performance.
Referring to Professor Henk Delport’s comments on this case, Walsh said that he has warned estate agents that it is essential to obtain proof that no arrears exist as an arrears problem can delay transfer indefinitely, with the buyer eventually having to pay this debt himself, even though it is not his responsibility.
“It is,” added Walsh, “absolutely essential to disclose to a buyer if arrears older than two years are owing. Although the legal situation is not 100% clear here, non-disclosure could, in terms of the Consumer Protection Act, invalidate the sale and make the estate agent liable for compensation.”

COOLING OFF PERIOD ON BUYING PROPERTY

2011-04-01T17:29:00.001+02:00

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Estate agents had better take note - one of the far reaching effects of the new Consumer Protection Act, which will be officially promulgated on 11 April, will be to allow signatories to agreements to change their minds within five working days of signing.
This means that any agent who gets a client to sign a mandate to sell his or her home has to accept that within five days he can cancel the arrangement.
There is, however, an important proviso, and that is that this ruling only applies if the deal came about as a result of what the Act terms 'direct marketing'. In practice this means that the client responded to a letter, an email, a flyer, an advertisement or a direct request from the agency. If the client has contacted the agent of his own accord, the newly signed mandate is valid from day one."
Agents must also take note that the Act obliges them to talk the client through the whole mandate agreement and to inform him of his right to "cool off" within five days.
Those looking for a quick fix in today’s market, especially if they are selling an expensive home, may have to accept that at least a three month mandate is needed. Very big, high priced homes in today’s market may take six to twelve months to sell, especially if the client has bullied the agent into setting too high a price.
Under the new Act agents will have to learn to operate in an environment where, no matter what contract documents are signed and no matter what they specify, if the consumer can later show that he, for any reason, did not fully understand the contract, he will be able to apply for its cancellation and a refund or replacement which, in the case of a home, would be exceptionally difficult to achieve.

NEW TRANSFER DUTY RATES

2011-03-28T20:34:00.003+02:00

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The transfer duty consequences which faced an investor in fixed property prior to the Budget Speech was that companies, close corporations and trusts [hereinafter also referred to as a "legal entity"] which acquired property and which are not subject to Value Added Tax ("VAT"), paid transfer duty at the rate of 10% on the price paid for that property. However, for an individual a lower rate applied, making it rather unattractive for purchasers to consider buying property in a legal entity.
However, the transfer duty rates have changed effective 23 February 2011. Thus, properties which are not subject to VAT on the acquisition of property by all persons (thus including close corporations, companies and trusts) acquired under purchase agreements concluded on or after 23 February 2011, will be subject to the following rates:

Value of property		Rates of tax
R0 - R600 000		0%
R600 001 - R1 000 000		3% of the value above R600 000
R1 000 001 - R1 500 000		R12 000 + 5% of the value above R1 000 000
R1 500 001 and above		R37 000 + 8% of the value exceeding R1 500 000

Legal entities can thus play a role once again in estate planning, but it is recommended that purchasers of property carefully consider the use thereof, and to consult an expert. This is especially in view of the current amnesty granted by the Receiver of Revenue which provides relief in a number of respects from adverse tax consequences when disposing of a residential property from a company, close corporation or trust.

CALCULATE THE VALUE OF YOUR PROPERTY

2011-03-28T20:21:00.001+02:00

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How does a homebuyer know if he is offering the right price for the property in which he is interested?
There are certain checks which can indicate whether the seller and his agent are going for a kill or pricing at market-related values.
The first should always be the prices recently achieved on similar homes in the area: a reputable agent, with links to good property statistical services, should be able to produce these on demand. If he or she cannot, this should always be seen as grounds for suspicion and a lack of professionalism.
These figures should include the floor area of the homes sold (in square metres) and sometimes of the plots as well. If the floor area is then divided by the sales price achieved (or asked, in the case of a home now being considered) the metre square price can be a useful guideline to the true value of what is now on offer. If several recent sales are analysed in this way, a reasonable accurate average figure for the area can be estimated. Nevertheless, all prices will reflect special benefits or disadvantages and should be explained and analysed in detail.
For example; let’s look at houses recently sold in a security complex (not loose standing houses) and what rand per square metre they achieved. R6 389 m² x 220m² = R1 400 000.00.
In stand-alone house purchase on their own plots, extras such as solid wood flooring and doors, designer fireplaces, underfloor heating, air conditioning and swimming pools can make it possible for the owner to ask far more than the average price for the area – and in today’s market lock-up and go units capable of being left empty for long periods are appreciated faster in value than traditional homes with large grounds. This can cause some frustration for those scaling down to apparently simpler and smaller units which, may cost just as much as their larger and grander home.
It is always a good policy to buy one of the less expensive homes in a good area rather than vice versa. If, however, a buyer does find himself attracted to a home priced higher than the average for the area, there could be a sound reason for this, which should become evident during the course of the inspection and negotiations.
It is necessarily foolish to buy well above the area average if you like a home – particularly if the buyer plans to stay there for a long time. However, he must expect that when the time comes to sell, the home will take longer to sell. Although it has to be accepted that the estate agent will be working for the seller rather that the buyer, it is perfectly legitimate to ask hom or her directly if thehome represents fair value and is market-related even though this question can be decisive in maintaining or tuning off the buyer’s interest.
Don’t take it personal if your property market valuation doesn’t meet your expectations. It is not about you, but the market and market conditions.

FIXED BOND RATE

2011-03-28T20:11:00.003+02:00

Visit our website http://www.overbergprop.com for properties for sale in Swellendam.

To fix or not to fix; that is the question.
The next move in interest rates (and the one after that as well as the one after that and so on and so forth) is up. We're at the bottom of the cycle and it's going to be a very long time before interest rates will again approach the record lows they're currently at.
So, if it's a dead certainty that rates are on their way up then surely fixing your rate is a no-brainer, right? Wrong!
The bank is not a charity and it's certainly not your friend. The only reason they'll fix your rate is if they're likely to profit from doing so.
A bank will only allow you to fix your rate at a hefty premium to the prevailing interest rate. In fact, the clamour for fixed-rate home loans has encouraged banks to increase their margins on these deals and bond holders are paying a hefty price for peace of mind — you'll be shocked to see just how expensive they are.
In most cases a fixed rate would've cost you more by the end of the prearranged period than if you kept it variable.
There is, in my opinion, only one good reason to ever consider fixing your mortgage interest rate and that is if you're on the edge and absolutely can't afford to pay more than the fixed rate (but why oh why did you get yourself into this position?). The only real benefit of a fixed interest rate is knowing exactly what payments you'll be making, because you almost certainly won't beat the bank.
If you simply must have the security of a fixed rate, expect to be paying dearly for it.

HOME LOANS - WHAT NOT TO DO

2011-02-19T09:36:00.003+02:00

Visit our website http://www.overbergprop.com for properties for sale in Swellendam.

If you want to improve your chances of being approved for a home loan, you should try not to take on any other big debts in the six months before you apply.
Banks don’t like to see too many recent requests for credit clearance on your record, so this is not the time to buy a new car or furniture on a hire purchase agreement.
In fact, you might even think twice at this stage about taking out a new cell phone contract or applying for a new store card.
Homebuyers should also do their best not to change jobs while in the process of applying for a home loan. Lenders look for employment stability, so if your reason for moving house is to take up a new position, you will need confirmation of this from your new employer to accompany your home loan application, in addition to your salary records from your current job.
In addition, homebuyers should not try to conceal anything in their financial past from the lender. If you have borrowed the cash to pay the deposit and will have to repay it, say so. If you have had credit problems in the past, admit to these too.
Today’s sophisticated credit checking systems will inevitably reveal the whole story, and once lenders find you have been less than truthful about one thing, they will naturally start to question the rest of your home loan application and once that happens, the chances are very good that it will be declined.
Two further pieces of advice for homebuyers are not to go on a spending spree for their new home if their home loan application is approved, and not to proceed with an application if a change in their circumstances means they will not be able to afford the repayments.
Some additional expense on a new home is to be expected, but you should resist the temptation to splash out and deplete your cash resources at least until you have taken transfer and established the actual running costs of your new home over a few months.
And if something should happen that makes a big change to your financial picture, such as a disabling accident or a retrenchment, for example, it is not a good idea to proceed with an application in the hope of securing the loan before the bank finds out what has happened. If there is a good chance you will not be able to repay the debt, you should rather withdraw the application - and keep your credit record intact.

Contact us on E-mail overbergprop@wol.co.za or Website www.overbergprop.com

TOLL ROADS CAUSES MAJOR SHIFTS IN PROPERTY MARKET

2011-02-19T09:29:00.001+02:00

Toll roads are the big issue for many consumers at the moment - especially in Gauteng – and they are set to have a major impact on home buying and renting patterns.
Hundreds of thousands of people travel between Johannesburg and Pretoria every day, many of them living in one city and working in the other, and it is estimated that such commutes will add at least R1000 a month per vehicle to the monthly household budget.
And the situation will no doubt be much the same for those commuting between the East Rand and West Rand, or between the southern suburbs of Johannesburg and Sandton or Midrand.
Even those using buses and taxis will be affected because fares will rise to cover the new tollsand if you add these new costs to already rising fuel prices, and higher food prices because of the higher cost of transporting freight via the toll roads, the cost of commuting will just not be affordable for many families.
We also can’t see most employers agreeing to increase wages and salaries to cover the increased cost of getting to work, so most commuters will be left with the choice of giving up their current employment and seeking work closer to home, or relocating closer to work.
Consequently we expect a surge of homebuyer interest in clusters of suburbs close to the major work nodes of central Johannesburg and Pretoria.
However, given that the property market is still slow and that existing homeowners may find it difficult to sell in order to relocate, what we think will happen first is a massive increase in demand for one and two bedroom apartments and townhouses right across Gauteng, as many commuters turn to buying or renting a small unit close to their workplaces where they can live during the week, and only go home at weekends. This way, they will also be saving on petrol.
We also expect that those lucky enough to be able to make use of technology and work from home most of the time, or have the skills and resources to set up their own home business, will increasingly do so, with a resulting increase in demand for properties with home offices or work spaces.

Contact us on E-mail overbergprop@wol.co.za or Website www.overbergprop.com

RESIDENTIAL PROPERTY PRICE DELINE

2011-02-19T09:20:00.000+02:00

Residential property prices declined in January 2011, albeit from a solid base following their strong recovery last year. However, according to bond originator ooba conditions are favourable for homebuyers to consider getting onto the property ladder.
The latest statistics from the oobarometer price index showed a year-on-year decline in the average purchase price of 6.3 percent (i.e. -10 percent when taking inflation into account) to R797 011 in January 2011 from R850 513 a year earlier. The average purchase price of a first time buyer declined by a modest 1.6 percent year-on-year, to R576 675, from R585 992 a year ago.
According to ooba CEO, Saul Geffen, while residential property prices are coming off their recent highs, the period of deflation is likely to be short lived with expectations for overall flat growth for 2011.
Additional statistics also tracked by ooba show there has been a continued trend by South Africa’s major lenders to ease up on their lending criteria.
"Over the last year we have seen the main lenders continue to relax their lending criteria and this has continued in January 2011 with the size of the deposit buyers are required to put down showing a significant decline."
In January the average deposit as a percentage of the purchase price was also down by 41.8 percent year-on-year to R117 396; the equivalent of 14.7 percent of the purchase price. The average initial decline ratio also declined by 4.4 percent to 46 percent in January 2011 from 50.4 percent a year ago. There was further positive news in January as the effective approval ratio increased by six percent year-on-year to 65.6 percent.
Geffen says in addition to the improved lending environment, the recent decline in prices presents an ideal bargaining opportunity for new homebuyers.
"For those homebuyers who have all their ducks in a row, including a deposit to put down, now could be the perfect time to begin negotiations on a property."

Contact us on E-mail overbergprop@wol.co.za or Website: www.overbergprop.com

LOW COST HOUSING GRANTS MOVED FROM UNDER PERFORMING PROVINCES

2011-01-21T21:24:00.000+02:00

A total of R463-million in human settlements grant funding is to be moved from two under-performing provinces to two which have met their delivery targets and require additional funding.
This was announced in Pretoria today by Human Settlements Minister Tokyo Sexwale, having applied his mind in line with a decision taken by all nine provinces at a MinMEC - a statutory meeting of the Minister and the provincial MECs for human settlements -- on 19 November 2010.
A total of R263-million is to be moved from Free State, and R200-million from KwaZulu Natal. The funds will be reassigned as follows:
R182-million to Northern Cape, primarily for the construction of 2 070 new houses across the province, at a cost of R178-million, as well the upgrade of 350 units in informal settlements at an estimated cost of R78-million. The remainder of the funds will be used for integrated residential developments.
R131-million to Limpopo, primarily for the construction of 5 300 houses in 17 districts as part of the province's Rural Housing Programme.
The remaining R150-million has been allocated to the National Rectification Programme which involves repairs to badly-built houses in various provinces.
"Two provinces which were earlier in the group of four under-performers - Western Cape and Eastern Cape - remain on my watch-list and their performance will be closely monitored," Minister Sexwale said. "We still expect that, by the end of the administration's term, all provinces will by and large have met their targets.
"It is important to note that the R463-million remains in the housing delivery process, and will be used to contribute directly to addressing the housing backlog and the needs of the poor - rather than being rolled-over and/or returned to National Treasury."

MORE LOANS NO DISCRIMINATION

2011-01-21T21:21:00.000+02:00

The actions of the Human Settlements Ministry do of course have a profound effect on the whole residential property market in SA, so it is always interesting to hear what it has on the agenda.
And its plans for 2011 are quite simply and encouragingly to ensure that more home loans are granted and that suburbs become increasingly integrated.
Certainly that's the essence of what Minister Tokyo Sexwale had to say recently about the Home Loans and Mortgage Disclosure Act (HLMDA) and about the government's R1bn Mortgage Indemnity Fund.
The HSM, he said, intended to see 600 000 new home loans made in the so-called gap market over the next four years as a result of the establishment of the indemnity fund to reduce lenders' risk.
This sector of the market consists of people who currently earn too much to qualify for a government housing subsidy but not enough to qualify for a home loan in the normal way. These include many nurses, teachers, police, prison warders, government officials, certain categories of managers and blue-collar factory and office workers.
Meanwhile, the ministry will be taking very seriously its responsibility to use the HLDMA, not only to monitor banks' lending patterns and ensure there is no discrimination in the awarding of home loans - but also to leverage the creation of more integrated suburbs.
"This transformation of our cities and towns, within the broader objective of building a non-racial SA, is a priority for this ministry," Sexwale noted.

BUYERS PUT HOUSE PRICES FIRST

2011-01-11T15:57:00.000+02:00

The residential property market has several factors in its favour going into 2011, including exceptionally low interest rates, slower-than-expected consumer price inflation and decreasing levels of household debt.
However no-one should be expecting any fireworks, because there is still a large stock surplus to be absorbed while economic growth and job creation are still sluggish.
Low interest rates are already helping the property market by putting extra money into household piggybanks and boosting the demand for credit such as home loans. Over the past few months this has already been evident in an increase in home sales activity that will no doubt continue if there is another rate cut early in the year, which many economists are predicting.
Meanwhile, Standard Bank has estimated that inflation will average 4,6% y/y in 2011, so even if house prices only grow at 7% - which we think is what we can reasonably expect - these will still beat inflation in most cases.
Nevertheless, we believe that property professionals and consumers will all still need to be cautious and patient. We are not going to see another boom period like 2003 to 2006 anytime soon. The market is going to take some time to recover, and we don’t foresee a major upswing in 2011 or even 2012.
Having said that there will be noticeable growth in the “small house” segment” (80 to 140sqm) where prices currently average around R780 000 – because this is no longer only the domain of first-time buyers.
In fact, we are finding that first-time buyers currently make up a significantly smaller percentage of buyers than previously, and that there are also fewer single-status buyers. Couples who can pool funds are stronger in the market place, while those with cash reserves are far more successful in being able to secure bonds.
But these purchasers, who are often second and third-time buyers, are now often targeting more affordable areas and smaller homes in an effort to contain living costs, rather than seeking to upgrade to bigger homes and higher-priced areas as they tended to do previously.
Indeed reports from around the country indicate that price is once again the primary consideration in buying decisions, followed by concerns about rates and taxes and electricity expenses as well as home maintenance costs.
We are finding, for example, that buyers are happy to drive a few kilometers further to work as long as the house price is right – which is one reason why the bank-led programmes to sell distressed / repossessed properties have been such a success.
Similarly, while access to shops, schools and major transport routes is still important, these are also secondary considerations to price and running costs in almost every case.

WHERE ARE WE IN THE PROPERTY CYCLE

2011-01-11T15:35:00.000+02:00

Cycles, a well-known phenomena in the world of economics, are evident in all economic sectors, including the property market. These cycles are predictable long-term patterns that can be divided into three distinct stages known as boom, slump and recovery.
The cycles are predictable in that booms are followed by slumps and then by a market recovery, which gives rise to the next boom as the cycle continues. The stages in the cycle are driven by various factors that affect the supply and demand equation in a particular market. In the property market, for example, supply and demand are driven by factors such as the interest rates, consumer debt-to-income ratios, the affordability of property and consumer confidence, among others.
However, while predictable, these cycles are rarely regular, since the length and depth or intensity of each stage within each cycle are influenced by the particular confluence of driving factors and their effect on supply and demand.
The current property market cycle in South Africa provides a very clear example of how various factors determine the cycles. “We experienced an unusually intense boom in the mid-2000’s, with demand driven by a rapidly growing middle class with access to easy credit at low interest rates during a time of exceptional economic growth in South Africa. Property price inflation reached a peak of almost 25%, property sales were brisk and property development was robust. But in 2006, an unusually intense slump, driven by an unusual confluence of factors emerged. Interest rates rose sharply, the implementation of the National Credit Act constrained lending and inflation soared as we entered a global and local recession, which negatively affected consumer confidence.
As a result of the confluence of all these driving factors, it became increasingly difficult for homebuyers to obtain credit, and homeowners faced severe financial difficulties in meeting their financial obligations. Many of these overstretched homeowners tried to sell their properties, and this, combined with the robust property development during the boom, created an oversupply of properties in certain sections of the market. This, coupled with the decline in demand driven by tight credit and affordability issues, saw the market enter a slump in which sales activity, house price inflation and new development slowed.
However, recovery after a slump is inevitable. We have already seen the interest rates drop to historic lows, which, along with inflation back within target range, have also boosted general economic recovery. Lower interest rates, improved general economic conditions and the correction in house prices to more realistic levels, have all led to an improvement in affordability. Sales activity is increasing as the banks slowly and cautiously start lending again, evidenced by improved approval rates of home loan applications. The supply and demand equation is beginning to balance again as the constraints on demand are lifted and already a shortage of properties is evident in certain areas. Given these realities, the South African property market appears to be firmly in the recovery phase of the cycle.
What does the property cycle mean to homeowners and potential homebuyers?
It is widely believed that the property cycle is a tool for ‘timing’ an investment in property. Buying at the height of a boom and selling during a slump can result in a disappointing return on investment. The real fundamental to lesson from the property cycle is that property is a long-term investment. Excellent property returns are often only achievable if the property is held for at least a full property cycle, which generally stretches over seven to 10 years in South Africa.
while we are in for what may well be a long and steady recovery phase, property investors and homeowners can take comfort in the knowledge that the slump seems to have passed. Hence, we can expect a boom to follow, and although the boom is unlikely to be as intense as that of the early-2000’s, it is sure to follow and will reveal to those who have held onto their properties during the recent and exceptionally tough slump phase that an investment in property remains one of the best long-term investments anyone can make.

HOME STAGING BECOMES A POPULAR TREND

2010-12-01T15:55:00.000+02:00

Home staging is an increasing popular trend in real estate. If you are selling your home you should at least aware of what this growing practice involves.
Home staging is a marketing strategy that encourages you to make your home as presentable as it can be to buyers by dressing the interior and exterior of your house so that it looks more like a model home. While there are a number of interior designers, experts, and even estate agents who can offer you advice on staging your home for sale, for most sellers a few simple tips can save you the expense of hiring a home stager.
Clean Is Key
The most important tip to remember when preparing your home for resale is to make it clean, clean, clean. The last thing a potential buyer will want to see is a sink full of dishes or a grimy bath. This may seem like a simple task, but the cleaner it looks the more interest it will receive.
Clear The Clutter
Another important tip when staging your home is to lose the clutter. Keeping rooms simple, modern, and tasteful is key. Also be sure that each room has a clear purpose and that everything in the room fits that purpose. This is also a good time to depersonalize your home. Remove family photos, personal collections, and anything else that may not appeal to potential buyers or that may detract from the features of your home.
Curb Appeal
When staging your home, don't forget to consider the appeal of the property itself. Be sure your front lawn is mowed and free of weeds, you have a tidy and presentable garden, and that the features of both the front and back yards are highlighted. You also want the potential of your property to be apparent to buyers who may want to make improvements.
There are some cases when you may also want to consider renting furniture or adding additional touches, but in most cases these simple steps can really make a big difference in getting the most for your home.
De Personalise
Of course our homes contain numerous things that we highly value but in the eyes of a buyer who is looking to potentially choose a property to make their home, it is a sound idea to de personalise the property. The posters the children have on their bedroom walls of their favourite pop group, drawings the children made that are stuck with pres-stick on the wall, the odds and ends that end up on the fridge are all part of living in your home but professional home stagers agree these serve to distract from creating the mental canvass that buyers need to see their family in the property and are best packed away for the new home or to put back out again after the sale is final. Of course it is important that you get the whole family on the “same page” about what you are trying to achieve.

PROPERTY - HIGH COURT DECISIONS

2010-11-26T15:06:00.000+02:00

As real estate developers and agents know, some people are prepared to pay staggering sums for a property if it has panoramic sea views or the vista of rolling hills .

But as an owner of a property, do you “own” the view? And do you have rights to protect your view if it is threatened?

Property specialists and lawyers never seem to know for sure and two high court decisions and a ruling by the supreme court of appeals on the so-called right to a view produced two vastly different outcomes.

There was much expectation the issue would be resolved by the constitutional court hearing of the case Camps Bay Ratepayers’ & Residents’ Association and Another v Harrison and Another.

But in a judgment delivered last week, the constitutional court avoided dealing with the issue directly as it found that the applicants had not, in fact, relied on section 7(1)(b) of the National Building Act, which is the point of contention.

In the Camps Bay judgment, the court declined to grant Anthony Herman leave to appeal against an SCA judgment, thus ending a six-year battle he has waged against his neighbour, Gerda Harrison.

Harrison had applied for and was granted permission to convert her single storey cottage into a three-storey mansion in Camps Bay. The new building left Herman with almost no view.

Herman’s legal challenge against the new house was not based on his diminished view, but rather that Cape Town city planning officials should never have approved Harrison’s construction plans if they had correctly applied section 7 of the National Building Act.

Parts of this section stipulate that a local authority must refuse to approve any building plan where the proposed structure “will probably or in fact derogate from the value of adjoining or neighbouring properties”.

Two high court judgments and an SCA ruling have offered widely different readings of this section, especially on the interpretation of the word “value”, which has resulted in the two conflicting decisions now being part of the case law.

David Warmback, a partner in Shepstone & Wylie’s corporate and commercial law department, says though last week’s constitutional court judgment doesn’t fully resolve the various issues of conflict, it also doesn’t give any further “ammunition” to owners who believe that they may have the right to a view.

The first case to deal with the issue of value and a view was the 2003 case Paola v Jeeva in the Natal high court, in which the SCA set aside a local authority’s decision to approve plans for a development project on the grounds that it “substantially impaired” the “unsurpassed view” of the owners of the neighbouring property. According to Warmback, in that ruling, the SCA also accepted that the only possible interpretation of the word “value” is market value.

But an appeal against the judg ment succeeded on a single technical point that the local authority had failed to appoint a building control officer.

A year later, when an identical case came before the Cape high court, the judge in that matter decided because the SCA decision was based on a technical point of non compliance, it was not binding on the lower courts.

In the matter of Clark v Faraday, the applicant tried to interdict his neighbours from building on an adjacent vacant plot which they legally owned. He argued that the building would impair his view and diminish the value of his property.

But the Cape courts came to an entirely different conclusion on how the provisions of section 7 should be read and delivered a judgment that created the conflict with the SCA. This judgment established two important principles on the question of derogation from market value, which the constitutional court reaffirmed in the Camps Bay judgment .

So property owners looking to the courts for permission to claim ownership of their view will have to wait a bit longer. As things stand, there is no absolute right for entitlement to a view.

WHO PAYS FOR PROPERTY IMPROVEMENTS DONE BY TENNANTS

2010-11-25T15:05:00.001+02:00

What two recent court rulings said.
At least two recent court cases have shown yet again that the tenant who improves a property while in occupation has no "ownership" or "compensation" rights to those improvements - even if it can be shown that they have significantly raised the value of the property says Raimond Lamprecht of THE PROPERTY MARKET SWELLENDAM ESTATE AGENCY.
If the tenant feels that an improvement is essential and that, if he handles it himself, he should be entitled to compensation, he should do a deal with his landlord before the work is undertaken.
This is, in fact, obligatory in law because a tenant may not alter a property without the landlord's consent. In getting this consent a deal should also be struck on who is to pay for it. In some cases the landlord and tenant can go 50/50 on these costs.
In the current not-too-buoyant property market, landlords may well neglect to paint walls, to treat the wood or resurface the floors of their properties, thereby almost forcing the tenant to do these jobs himself. In these circumstances the tenant must apply as much pressure as possible to see that they are paid for any maintenance carried out.
What tenants most want is an alarm system and burglar bars. This is normally negotiated before a lease is signed if the house does not have adequate security measures. However, problems arise if the tenant wishes to do further improvements after they have moved in. The golden rule is to communicate with the managing agent or landlord prior to any work being completed.

WHY LESS IS MORE

2010-11-25T14:53:00.000+02:00

Unless they focus on what they need, rather than on what they might want, homebuyers are quite likely to end up with too much house.
In many countries there has already been a significant move away from suburban 'palaces' to more compact homes that are more affordable, use less energy and are easier to maintain.
And now we are beginning to see that trend gain momentum in SA, thanks largely to the strict application of the National Credit Act and the limits placed on initial affordability by the lenders’ almost universal insistence that homebuyers put down hefty deposits.
But there are several more good reasons for prospective buyers to be very practical when choosing a new home.
The three main things to think about are the size of the stand, the size of the home itself and the need, if any, for "extras" such as a pool, a second garage or even a garden shed.
If you want to move from a flat or a townhouse to a place with a garden, for example, you may well be attracted to houses on very big stands. But apart from having a higher cost of acquisition that will boost your bond repayments, a large stand will also mean higher upkeep and security costs and higher municipal rate payments for as long as you own the property.
So unless you are actually going to use the land for a home-based business, or have a plan to subdivide and develop it fairly soon, a smaller stand is generally a better bet.
When it comes to the home itself buyers often don’t stop to think of their actual space needs and what unused rooms could cost them in the long run.
But it is not rocket science to work out that it is going to be cheaper to clean, maintain and care for a 200sqm home than a 400sqm home. Your water and lights bills will also be smaller and those savings will come on top of a smaller bond repayment every month.
And finally it is also important to consider what real use you will get out of those "nice to have" extras and whether it is worth paying for them.
For example, a swimming pool near your entertainment area may look good but if you are not actually going to use it regularly it would be a waste to pay a higher house purchase price just to have it and an ongoing waste to pay for the chemicals and equipment required to keep it clean.