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I IIssue: May 2006
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. Homeowners:
Winter months a good time for home maintenance
3. Sellers:
Honesty really is the best policy
4. Buyers:
All the insurance you need
5. Make
sure the memories really last
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1.
Welcome By Publisher
If, like me, you have been watching
the build up to the Soccer World Cup in Germany over
the past few weeks, you will also have got a foretaste
of the huge economic benefits this event brings to
any country lucky enough to host it – and not
least in the real estate sector.
It is estimated that the tournament will pump more
than 10 billion Euros into Germany’s economy,
with the bulk of it going to the companies that have
upgraded and expanded the infrastructure and built
the new stadiums, hotels, restaurants and shops.
Two or 3-billion Euros have also already been spent
on special World Cup goods and services and the whole
tourism sector – not only the operators in the
12 cities that will host matches – will share
in the bounty of an expected 1-million foreign visitors,
each spending between 800 and 1000 Euros a day while
they are in Germany.
And of course, anyone with a suitable
property to rent during the tournament will also be
raking it in – but the benefits to the country’s
real estate sector will go much further than that.
Apart from the additional exposure and attraction
of foreign investors that comes through the media
coverage of the tournament, it stands to get a huge
boost once all the fans have gone home from local
buyers that are newly employed or have got better
jobs as a result of the overall boost to the economy,
which the experts reckon will be equivalent to a rise
of 0,5 percent in Germany’s GDP.
I expect that this is also the sort of outcome we
can expect when the beautiful game comes to SA –
and 2010 is really not that far away any more.
Meanwhile, despite some recent reports to the contrary,
property prices in SA are showing no signs of falling
– although they may not be growing as fast as
last year or the year before. Indeed, if they are
read properly, the latest statistics from the banks
and the deeds office show that house prices are still
showing double-digit increases year-on-year, which
means growth in the real estate sector is still well
ahead of inflation.
Not to mention the fact that
anyone who bought a home three or four years ago and
is selling now will still get the benefit of all the
growth since, not just this year’s gain. In
short, it really is time now to stop anticipating
a famine and start planning for the feast.
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2.
Homeowners:
Winter months a good time for home maintenance
Cooler winter months are the ideal time to tackle
home maintenance – there is less work to do
in the garden, and the dry weather in most parts of
the country offers an opportunity to finish exterior
paint and varnish jobs without interruption.
And if you don’t have a maintenance programme
in place, this is the time to sit down and draw up
a practical plan that will keep your home in good
condition all year round. Start by thoroughly inspecting
your home and listing all jobs to be tackled, such
as flaking paint work, cracks that need to be repaired,
cracked window putty, loose roof tiles or missing
roof screws. Check for roof leaks and note the condition
of gutters.
Also inspect the plumbing by checking visible water
pipes for cracks, leaks or rusting and make sure taps
are not dripping and cisterns are not leaking. Inspect
the electrical distribution box, look out for any
signs of shorting or exposed wires and check that
your earth leakage is still functioning by pushing
the test button.
Once you have done this you can decide what needs
to be done first - a faulty electrical system obviously
being more urgent than faded paint work – and
also which jobs you can do yourself and which would
be better left to the professionals.
But whatever you decide, remember that a regular
maintenance programme will make your home much
easier to sell when you are ready to move, and save
you a small fortune in repairs in the meanwhile. The
old adage, a stitch in time saves nine, still holds
true for homeowners – it is much cheaper to
clean out gutters regularly, for example, than to
replace gutters that have been neglected and rusted
through.
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3.
Sellers:
Honesty really is the best policy
Making a clean breast of any defects
or drawbacks in a property when it is offered for sale
is still the best policy.
It may be very tempting to try and hide rising damp
beneath a fresh coat of paint and hope the deal is concluded
are signed before the buyer notices – but the
chances are good that he will and that, at best, you
will lose the sale.
At worst, the buyer who is taken in and does go through
with the purchase could well have grounds for legal
action against you when the deception comes to light,
and may well succeed with a claim for damages that could
easily wipe out any profit you made on the sale.
Obviously the best course of action is to properly repair
any defects you know about before the property is marketed.
But if time does not allow this, you should fully disclose
any defects to your agent and then let him or her negotiate
a fair price.
In such cases, it is more important than ever to appoint
an ethical and professional agent to advise you. Such
an agent will be able to distinguish between serious
and inconsequential defects and will be able to assess
which problems should be rectified before marketing
the property.
He or she will also be able to help you set a fair price
for the property as it is, which will, in the long run,
save you time and money – especially if it helps
you avoid a protracted legal dispute.
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4.
Buyers:
All the insurance you need
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If you are buying a property with
the aid of a home loan (like most people) you will
probably require the following three different types
of insurance:
* Homeowner’s insurance, which provides cover
against damage to the structure of a home in the event
of disasters such as fire, flood, wind and hail. This
type of policy protects the bank from loss of the
“asset” that secures the home loan, and
protects the homebuyer against possibly having to
pay the outstanding balance of the loan even when
the home has been badly damaged or destroyed.
* Homebuyer’s insurance, sometimes also called
“bond insurance”, which is life insurance
specifically intended to settle any outstanding balance
on the home loan if the borrower dies or is incapacitated,
and so relieve the family of a debt they may not be
able to pay. Your lender might not insist on this
cover but most would certainly prefer you to have
it.
* Householder’s insurance, which quite simply
covers the contents of your home, whether owned or
rented, to the extent that you decide. Most companies
providing such cover offer a choice of comprehensive
insurance including theft or insurance limited to
damage only, and in most cases will also provide vehicle
cover.
It is important to note that you
are free, as a homebuyer, to purchase all or any of
the three forms of insurance above from any provider
of your choice – but that home loan lenders are
also free to withhold loans from those they consider
under-insured.
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5. Make
sure the memories really last
Many young couples dream
of a wedding with all the trimmings, but with even a
modest reception costing many thousands of rands, they
might be better advised to skip the imported champagne
and the chocolate fountain and put the savings towards
a deposit on their first home.
Buying a home is still the best way for most people
to build a financially secure future, with their monthly
payments going towards the purchase of an asset rather
than just paying a landlord.
And if the newlyweds can afford even a small additional
amount per month over and above the minimum repayment,
they will quickly build equity in the home, giving them
increasingly significant financial leverage.
Of course remaining in credit on a mortgage will save
money over the years, since interest will be substantially
reduced and the property paid off more quickly. But
homeowners can also borrow against equity to pay for
other expenses, such as their children’s education
or home improvements that will, in turn, add value to
the property.
However, despite the current low interest rates, steadily
rising property prices mean that the longer they delay,
the harder it is for newlyweds to get on to the real
estate ladder.
There is thus also much to be said for the old custom
of giving a bridal couple a gift of money towards a
deposit on a home. While it may not be as fashionable
as some of their other presents, it will certainly be
remembered a lot longer.
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