The A-Z on property jargon!

The South African Property Dictionary...

Have you ever stared at a piece of paper, which you know contains vital information, in complete disillusionment?

Have you have looked wide-eyed at a word that you have no idea what it means, and had that sinking feeling in your stomach that you are in for a joy ride that is going to be extremely confusing?

Well, I know how you feel, so here is some of that vital information, that you don’t understand, explained in “human terms”. Please note that this is not a full comprehensive list and that well be updating this list on a contstant basis.

Alienation of Land Act: This law is usually applicable to people who do not qualify for a home loan. It describes a property sale when the property is transferred into the buyer’s name at a later date.

Borehole certificate: This is generally needed on agricultural holdings, and you need a specialist borehole contractor to give you the certificate, it states that the borehole yields a certain amount of litres per hour.

Cession: This is a customer’s policy that is ceded to the bank. For example, Standard Bank would hold the cession, while Charter or Liberty Life would retain the policy document.

Domicile branch: The branch of the customer, where his/her home loan is.

Domicilium Citandi et Executandi: This is the physical address where the delivery of a legal notice will be accepted by a party to a written agreement.

Expropriation: This is when the local authority needs a portion or the entire property for its use. The bank needs a letter from the customer and the local authority, and an assessment has to be done on the remaining security.

Further advance: This is when you need more funds; you would register a further bond over the property.

Home Owner’s Comprehensive Insurance: This policy provides cover for certain loss or damages to the property.

Interim interest: Once funds are paid out of the home loan account, interest is calculated on a daily basis on the outstanding balance. The interest is debited to the home loan account at the end of the month.

Latent defect: This is a fault or flaw that is not immediately detected, or is hidden from view on inspection of the property.

Mandate: This is an agreement between the seller and the estate agent to market the property.

NHBRC: The National Home Builders Registration Council ensures that builders extend their commitment to customers by providing a five-year warranty. Make sure you use NHBRC certified builders.

Progress Payment Form: This is a form signed and completed by the customer as building work progresses. The assessor does an inspection and releases the retention accordingly.

Readvance: When you have repaid a portion of your home loan, you may borrow all or part of the loan amount.

Sole mandate: This is an agreement between the seller and the estate agent to exclusively market the property. Once the agent is allowed to market the property, he has sole rights.

Transfer fees: These comprise transfer duty, conveyancer’s fees and VAT. Transfer duty is a tax levied by the government on the purchase of immovable property and is calculated on the purchase price.

Voetstoots: This clause is always found in a sale document and means “let the buyer beware”. All defects must be mentioned to the buyer upfront. If there are any defects in the property of which the seller was unaware, the buyer will acquire the property with such defects.

Zoning: The local authority determines the purpose for which your property may be used, for example, residential or business. If your property is granted business rights, talk to your local authority as it may affect its saleability.

I hope this helps you to understand just a few of those difficult words that you may encounter in your journey in property or building.

CopyWriting By: Laiken Cullen
http://www.propertyloans.co.za/113/home-loans-jargon-explained

Pretoria Real Estate - Property in Pretoria Sucks!

Apartment living. It's all over! It's been around for years and that's where real estate and property world is going and has been for the last 300 years! Over the last 2 years I've travelled from New York to Toronto, from Hamburg to London and from the South of France to Rome and condos and apartments are the way of living.

Pretoria on the other hand, the capital of South Africa and the most beautiful city in South Africa are on a par with India as far as I'm concerned and it's really starting to grate my cheese...

We have 3 universities in Pretoria. It's a student town and there are loads of young people living here. Yet, we insist on building face brick houses in security complexes. PEOPLE, DEVELOPERS IN SOUTH AFRICA AND PRETORIA:
Face brick security complexes selling for R800 000.00 is not going to satisfy the young entrepeneurs or the students in this city!!! When will you realise this...

My goal this year is to build awareness in the Property market in South Africa and we're going to start with Real Estate in Pretoria because it's my home town.

We need apartments, nice, fully equipped modern apartments for single youngsters and young couples. Surely we can build nice apartments and sell them for under R800 000.00 an apartment.

I can tell you now, from working in the home loans industry for close to a year now that the average Pretorian looking for comfortable living and looking to get into the property market cannot afford more than R650 000.00 bond with our current interest rates being 14.5%. This is what's missing here right now!!

So to all you developers in Pretoria I'm telling YOU! THIS IS WHERE THE MONEY IS!!!

Drop the face brick, drop the simplex living with 3 bedrooms and 2 bathrooms and absorb the way of the FUTURE!!!

CONDO LIVING IS PRETORIA!

Sectional Title - Online Property Course - Chapter 1

As promised here comes the first of our new Free Online Property Courses.

An initiative by Wizard Midrand home loans.

Scheme

This topic looks at the concept of a 'development scheme'. It covers the underlying definitions, the approval
procedure, building compliance and residential tenant protection.

1 Sectional Title Scheme

A sectional titles scheme comes into being when conventional land and buildings are 'developed' under the Act as a 'scheme', or 'development scheme'. This happens when a developer decides to divide the land and the building(s) on the land into sections and common property by opening a sectional title register for the land and the building(s).

At this stage the entry in the land register for conventional land is endorsed to the effect that the land is included in a development scheme under the Act and no further entries are made in the land register.

2 Approval procedure

Section 4 of the Act covers this aspect. A developer who wants to develop a sectional title scheme must make sure that the land on which he wants to develop the scheme is situated within the area of jurisdiction of a local authority and that the building which he has erected is of a permanent nature. He must then instruct an architect and a land surveyor to ascertain whether the land and the building comply with any operative town‐ planning requirements and whether the building has been erected in accordance with valid building plans.

In case of non‐ compliance the developer would have to apply to the local authority
concerned (municipality) for condonation of the defect. This means that he must ask the municipality concerned to excuse or disregard the defect. Should he want to convert an existing rental building to sectional titles, the tenants in the building must be given certain information and a right to purchase their sections before he can proceed. He must then instruct the architect and land surveyor to prepare a draft sectional plan showing the division of the land and buildings into sections, common property and exclusive use areas and to submit the plan for approval by the Surveyor‐ General of the region where the property is situated.

Once the sectional plan is approved it can be submitted to the deeds office for registration.

3 Requirements for approval of a scheme

Section 4 of the Act provides that:

• A developer who intends to establish a scheme must arrange to have a draft sectional plan submitted to the Surveyor‐ General (the sheets of the plan can be prepared by a land surveyor and an architect can prepare all sheets except for the first, the 'block plan');



• There can be more than one building and more than one piece of land in a scheme and separate pieces of land do not have to be adjoining



• A building must not extend over the boundary between two pieces of land unless they have been notarially tied. A 'notarial tie' is created by registration of an agreement executed before a Notary Public to the effect that the two properties cannot be separately dealt with.

4 Residential tenant protections

Sections 4 and 10 of the Act make extensive provision for the protection of residential housing consumers (tenants) during the process of the development of existing leased buildings (rental apartment buildings) as sectional title development schemes.

References:
Sectional Title Property Searches - Deedsearch - http://www.deedsearch.co.za
UCT - University of Cape Town - http://www.uct.ac.za
Acts - Acts Online - http://www.acts.co.za

Here concludes Part 1 of South Africa Online Property Course.

Property Site tells users where to find Property!

Your Property woes are gone. Finally, an initiative, maybe even a world first from the owners of Gravity.co.za, South Africa's first property search engine.

An article from the owners of Gravity.co.za...




"For quite a while we've wanted to provide our users with an area-type search feature where they could see, at a glance, all the houses in a particular area/within a given radius.

Most real estate property sites overseas would probably implement it as a map, but since South African agents don't provide street addresses for their listings and reliable street/area information biased towards real estate (e.g. that include estates, brand new road and suburbs that are continually appearing) is not really available, map searches are not an option.

There just seemed no way we could get something useful out until we suddenly realised that we had hundreds of thousands of users who had been telling us exactly what suburbs they thought were relevant to them. South African users are patient and diligent when looking for property due to the lack of user-friendly search capabilities like Google Mashups etc. They had given us really great data to analyse for trends. We ran a few basic algorithms to answer the question "if a user is interested in property in suburb X, what other suburbs will he/she most likely search" and the answers/correlations we got were just incredible. We optimised the algorithm and extended it to "if a user is interested in property in suburb X, Y and Z what other suburbs will he/she most likely search" which was launched on 1 August, try it out for yourself:

go to the Gravity Property Index homepage - www.g.co.za and enter the suburbs you're interested (comma separated) in in the Quick Search Text box. Select your price and hit enter - you'll see at the top of the results page that is returned, a list of recommended suburbs.

The powerful thing about this feature is that it's changed the search results from 'nearby' to 'most relevant'. GPS/map-based solutions have 2 shortcomings which 'most relevant' solves:

1. "Other side of the road". Often more expensive ('X') areas border on lower cost areas ('Y') and on map-based/radius searches both will be included in search results. It was quite interesting to us that although people looking for houses in X would never specify Y in their search (as you'd expect), the converse was not - people searching in Y would search a house in X. Intuitive I guess but satisfying to see 2 completely different result sets. If you're familiar with Cape Town, try a search for Rondebosch (X) and compare it Athlone/Rondebosch East(Y) - they border one another and even sound the same, but the relevant suburbs are not at all similar

2. "Similar Suburbs across town". It seemed buyers were interested not only in the location of a suburb, but its overall profile e.g. property values, great views / location next to the sea, near schools A OR B (across town from one another) etc. Area searches don't correlate 'LIKE' suburbs, just ones close together. Just as important we found was that, in a region with say 10 suburbs, often 3 or 4 would be LIKE, so the user would not have to search all 10 to get the houses in the most relevant 3 or 4.

And this was only possible thanks to the information contained in the minds of our visitors - keep searching!

Foreign Investors - Buying Property In South Africa

NEWS NEWS NEWS
I LOVE NEWS

Call me weird but I just love picking up the paper and finding a property related article, specifically a property related article that's worth blogging about.

Today's lucky winner is the Pretoria News.

Property in South Africa still open to foreign buyers

There's been alot of talk about adding restrictions on the foreign ownership of property in South Africa. According to the Pretoria News the reason there's been such escalations in the price of property is because of the foreign investmentors that have been pouring into S.A. over the last 5 years.

Is that true, partially, they bring money in, they're willing to pay more so property prices jump up! However, lets think a little about this, NCA being released, new credit laws, interest rate hikes, they're all BIG BIG BIG contributors to the property price escalations. Personally i think it's someone who's blaming foreigners for the average price of a house on the Pam Golding website sitting around the R1 500 000.00 mark :) *duck*

There have been some serious considerations though in terms of putting restrictions up:

- Long Term leasing of property versus outright sale of land
- A possible moratorium on sale of land to foreigners
- Th identification of instances where a prohibition on foreign ownership of land could be justified, such as national key points, water catchment areas, land along border lines and internal borders
- Special ministerial approval in cases where certain categories of land were considered for disposal, such as land earmarked for land reform, restitution or integrated human settlement

There are those that are of the belief that foreign investors are the people that have made this country the financial success story that it is today. BRING EM ON! WE WANT THEIR MONEY DAMMIT. STOP BEING SO ANAL. Let them spend their money in OUR country. In terms of loans and financing, foreign investors are already limited to a 50% loan.

What we should do is only provide loans to foreign investors if the property is over a certain value i.e. R5 000 000.00 and then still only give a 50% mortgage loan. This way half the money needs to be brought into South Africa and the other half can be financed by our banks. Either way don't shut them out, they're the people that bring the spark to SA...

WizardMan Out!