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| FNB House Price Index Improves Further |
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The FNB House Price Index showed a second consecutive monthly improvement, rising 2,7% in December from a revised 1,4% (2%) in November. The index registered a -0,9% decline in October.
FNB said in a statement on Monday that the House Price Index average for 2009 showed a decline of -3,9% compared with the average value for the previous year. This is significantly worse than the +6,9% inflation of 2008, and a far cry from the +29,5% average price inflation registered in 2004, which proved to be the best year of last decade.
FNB said in a statement that while it had been a dismal 2009 as a whole, on a monthly basis the index pointed to steadily improving times as the year drew to a close.
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| Boschendal Founder Estates |
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Boschendal Founder Estates, its time has come. After three centuries of jealously guarded ownership, Boschendal is ripe for five star residential development, Boschendal Founder Estates.
In 1694 the Huguenot brothers Pierre and Jacques de Villiers sought refuge in the Drakenstein Valley.
They and their descendants made Boschendal their home for 180 years and left behind a legacy of stately gabled homes, thatched cottages and a noble tradition of wine making, which remains to this day.
In 1896, Cecil John Rhodes arrived at the beautiful valley of vines to find it wrecked by vine phylloxera (a destructive pest). His idea was to switch from grapes to fruit so he bought Boschendal and 10 farms in the area, established Rhodes Fruit Farms and a canning factory and made plans to export the products via his Cape-to-Cairo railway.
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| Get a Property Market Overview of 2009 |
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So what is the verdict on 2009 from a residential property perspective? Was it as calamitous as 2008 and what's in store for 2010?
"2009, although possibly the worst year in the South African property sector since the 1939/1945 recession, was not the total disaster that many doom and gloom pessimists had predicted it would be in the first two months of the year," says Lanice Steward, MD of Anne Knight Porter Frank (APKF).
Drawing heavily on the recently updated FNB Global Economic and South African Property Reviews, Steward said that several sets of figures support her contention that the South African residential sector is now coming out of its recession and is set for a better year in 2010.
"First, we have to look at the IMF forecasts for the world economy in 2010. IMF anticipate a China-led revival giving a 5,1% growth in GDP overall, with even the USA at last in positive territory with a 1,5% growth, while the G4 growth will be at 2% plus.
"Second, in South Africa the year-on-year (y/y) decline in commodity values (on which we are heavily reliant) has now bottomed out and prices are on the up once again. A similar trend appears to be evident in many of our exports.
"Third, South Africa's Leading Business Cycle Indicators, boosted by the lower interest rates and the recovery of the global economy, have been rising since March this year.
"Fourth, taking these and other factors into account and the recent unexpected rise in GDP after nine months of decline, economists are now looking forward to a 2% GDP growth in 2010. This is by no means spectacular, but if I understand the experts right, it could usher in higher growth in 2011.
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| Rate of House Price Growth Accelerating |
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Absa says there is a prospect of price deflation of less than 0.5% for the full year. Nominal year-on-year house price growth in the local housing market picked up further in November 2009, Absa said on Monday.
The bank said there was a prospect of price deflation of less than 0.5 percent for the full year.
After adjustment for the effect of inflation, house prices continued to decline in real terms up to October this year, albeit at a slower pace, property analyst Jacques du Toit said.
House prices in the middle segment of the market were up by a nominal 4.7 percent year-on-year to R1,006,300 in November, after increasing by a revised 3.4 percent year-on-year in October, he said.
Month-on-month price inflation came to 0.9 percent in November.
Du Toit said that in real terms, middle-segment house prices were down by 2.4 percent year-on-year in October, compared with a decline of 3.9 percent year-on-year in September after revision.
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| 2010 Property Predictions: Don’t Expect Double-Digit Returns |
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Those South African property watchers who are predicting significantly improved conditions in 2010 are by and large unrealistic, says Mike Flax, Executive Director of Redefine Properties.
South Africa is following the rest of the world out of its recession, but the property cycle traditionally lags a year behind the general economy and the first year in which conditions start improving can often be as difficult for the property sector as the recession.
The reason, says Flax, is that it takes time for the secondary effects of the recession to make themselves felt.
Although there are now clear signs that the South African economy has at last turned the corner, tenants (in all walks of life) will in the recovery period still suffer from the job losses and expenditure cut-backs which the recession made essential. In the retail sector vacancies in both malls and the high street, we have found, tend to be as serious in the initial upturn as in the downturn phases.
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| Investor Note on National Budget Mauritius 2010: Foundations for a Bright Future |
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Inclusive, empowered and resilient growth over the last four and a half years have transformed the Mauritian economy and now prepare the way for a bright future.
The National Budget 2010 provides comfort to the investor community that the country will return to its growth path of over 5% p.a by 2011. In the face of the world’s most severe crisis, Mauritius has managed to come out relatively unscathed with a reasonable growth rate of 2.3% in 2009 and around 4% in 2010. The Mauritius financial services sector has faired relatively well despite the crisis. ICT and IT-enabled services have grown significantly becoming a larger GDP contributer than sugar. While textiles and tourism have suffered with the crisis, the number of tourist arrivals is expected to pick up in 2010 and textile, which was on a recovery path just prior to the crisis, should also show some improvement.
| Board of Investment Mauritius (BOI), 19-11-2009 |
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| Print Giving Way to the Web in South African Real Estate |
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Print is steadily losing ground as the Internet becomes the number one advertising medium for estate agents, a new survey shows.
The results of the just-released poll show that local or community newspapers are now the only print options that command more support than the Internet, with 54% of agents regularly placing adverts in these papers while 47% make use of online property portals to showcase their stock.
What is more, 74 percent of agents now also regard their company websites as important advertising channels.
By contrast, only 34% of agents advertise in the property magazines that are distributed for free, and only 29% support the weekly property supplements to major newspapers. Even fewer make use of glossy property magazines (15%) and just a handful (3%) ever advertise on TV.
| Institute of Estate Agents (IEASA), 30-10-2009 |
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| Benguela Cove Lagoon Wine Estate - Wineland Attractions on a River near the Seaside |
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Vast vineyard plantations coupled with lavender fields and olive groves plus the panaromic surrounds of a lagoon, ocean and mountain offer beautiful scenic views to prospective residents of the Benguela Cove Lagoon Wine Estate.
Benguela Cove Lagoon Wine Estate, an hour from Cape Town and 10km from Hermanus, encompasses both a country wineland ambience and the allure of coastal attractions.
Situated on the banks of the Botrivier Lagoon, in the acclaimed Walker Bay Wine region, the estate is made of 124 residential stands of which 60 have been sold. It was launched in July 2005.
Priced from R2m to R5m, the stands average from 2,000m2 with some double plots over 4,000m2.
Completed homes on sale are priced from R7m to R15m and others are currently under construction. The homes adhere to specific architectural controls which give consideration to the environment, encouraging the use of natural building materials and reflecting contemporary and classic designs. Home owners can choose from four house types namely Ridge, Barn, Lagoon and Courtyard.
Benguela Cove Lagoon Wine Estate offers a private nature reserve, a boutique hotel, restaurant plus tennis facilities, boating, fishing, water skiing and two deep water jetties for the outdoor enthusiast.
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| Now for the Good News..... |
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Homeowners are anxiously seeking signs that the property market downslide is levelling off. Unfortunately, there are mixed signals from analysts, but there are more rays of light than black clouds.
A number of property sector analysts are slowly reaching the conclusion that national house price inflation has finally bottomed, or is levelling off. Furthermore, there are signs that housing is at last becoming more affordable. However, there are still some economists who consider that a significant shift will only become apparent towards the end of the year or early in 2010.
Absa's August report says that house price deflation is near the lower turning point on a year-on-year basis, while month –on- month deflation slowed down further in July after bottoming in March this year.
The report forecasts an annual drop in house prices for 2009 of a nominal 10%, which in real terms (allowing for inflation) is around 3,5%.
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| Has The Property Market Bottomed? |
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The South African property market has experienced a steady decline in property price growth since the last quarter of 2007.
This growth decline eventually became negative growth and the extent of this property price decline varies from 5% to 20%, depending which sources you refer to and the geographical area under discussion.
A burning question in the minds of both buyers and sellers at present is: What will happen to property prices going forward, or more critically, when will property prices move into positive growth again? Tony Ketcher, managing director of Seeff Properties Randburg, believes that property prices have bottomed, and explains why.
"There are a number of simple facts which lead me to believe the property prices may have bottomed. It is, however, too early to expect that we will see any kind of growth in prices for the next 18 – 24 months.
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