Asking Price Reduction In Durbanville

A big thank you to readers who send in data about housing markets they have their eyes on. Reader TM sent in this list of properties he's been keeping hie eye on in Durbanville.

Ref	Price	Date
44183	R1750000	23/10/2007
44183	R1550000	31/10/2007
45027	R3100000	22/08/2007
45027	R2995000	31/10/2007
45340	R3300000	23/10/2007
45340	R2900000	31/10/2007
45343	R1895000	23/10/2007
45343	R1750000	31/10/2007
45649	R2100000	04/09/2007
45649	R1995000	31/10/2007
45729	R1650000	28/09/2007
45729	R1600000	31/10/2007
45770	R929000	01/10/2007
45770	R899000	23/10/2007
MP100321	R3300000	08/10/2007
MP100321	R2899000	31/10/2007
MP100370	R1195000	29/08/2007
MP100370	R1150000	28/09/2007
MP100370	R1128000	31/10/2007
MP104471	R1295000	23/10/2007
MP104471	R1225000	31/10/2007
MP104875	R640000	08/10/2007
MP104875	R620000	31/10/2007
MP104881	R945000	08/10/2007
MP104881	R915000	31/10/2007
MP104913	R3000000	01/10/2007
MP104913	R2650000	31/10/2007
MP106388	R749000	08/10/2007
MP106388	R699000	31/10/2007
MP107358	R1295000	23/10/2007
MP107358	R1285000	31/10/2007
MP108685	R2200000	23/10/2007
MP108685	R1900000	31/10/2007
MP110395	R1275000	29/10/2007
MP110395	R1250000	31/10/2007
MP110965	R2200000	23/10/2007
MP110965	R1900000	29/10/2007
MP59155	R1195000	14/09/2007
MP59155	R1125000	23/10/2007
MP69431	R699000	01/10/2007
MP69431	R679000	31/10/2007
MP76164	R566000	14/09/2007
MP76164	R549000	31/10/2007
MP76188	R1800000	10/09/2007
MP76188	R1695000	08/10/2007
MP84556	R970000	06/09/2007
MP84556	R935000	31/10/2007
MP85047	R1660000	30/08/2007
MP85047	R1599000	08/10/2007
MP85047	R1590000	31/10/2007
MP88765	R1195000	14/09/2007
MP88765	R1080000	01/10/2007
MP89563	R899000	06/09/2007
MP89563	R890000	31/10/2007
MP92627	R850000	14/09/2007
MP92627	R800000	23/10/2007
MP94027	R2750000	22/08/2007
MP94027	R2395000	31/10/2007
MP94265	R1175000	20/09/2007
MP94265	R1150000	31/10/2007
MP95379	R1895000	14/09/2007
MP95379	R1849000	18/10/2007
MP95379	R1799000	31/10/2007
MP96294	R1100000	08/10/2007
MP96294	R1075000	23/10/2007
MP96302	R1975000	22/08/2007
MP96302	R1925000	14/09/2007
MP99543	R795000	22/08/2007
MP99543	R750000	14/09/2007
MP99543	R725000	31/10/2007
MP99547	R1895000	22/10/2007
MP99547	R1750000	31/10/2007
MP99548	R3300000	08/10/2007
MP99548	R2899000	23/10/2007

90K Price Drop In Two Days

Here's a 2 bedroom house with 3 attached flatlets. On the 29th of October the asking price was R1 280 000. On the 31st of October the price is down to R1 190 000 and the seller is 'motivated'. Now according to the ad you could be earning close to R10 000 a month on rent if you rented everything out and if the seller bought for less than the current asking price they should be easily cash flow positive. So why sell?

25K Rent For Cartwrights Corner?

Nothing smells more of a desperate specuvestor trying to cover their bond than an ad asking for R25 000 in rent for a 2 bedroomed apartment.

And you call that a kitchen?

Asking Prices in Durban

Reader SZ sent us this spreadsheet of asking prices on houses he's been keeping his eye on in Durban. It seems like people are deciding it's better to die by a large number of small cuts than rather price downward in one big cut. I call that catching a falling knife. A number in green means that the price was reduced from some higher price. A number in red means that the property was removed from the market and then brought back on, an old trick agents use to pretend like the property is brand new on the market.

Escombe	10 Cowell St, Queensburgh	810000	790000	760000
New Germany	32 Lewis Walter St	760000	760000
The Wolds	11 Glockner St	785000	765000
Waterfall	142 Valley drive	850000	830000	800000
Westville	58 Severn Drive	900000	850000	800000
The Wolds	8 Janine St, New Germany	795000	775000
Crestview	44A Rainbow Drive, Waterfall	930000	895000
Escombe	20 Philips Rd, Queensburgh	770000	770000
Caversham Glen	17 Plymouth Rd, Pinetown	795000	750000	740000
Malvern	9 Rodney Rd, Queensburgh	850000	830000

Interest Rates Going Down? Don't Bet On It.

Inflation won't be tamed any time soon - Moody's

Moody's, the international ratings agency, yesterday poured cold water on hopes that inflation would soon be tamed.

It said household spending could have more steam than initially expected, raising the possibility that inflation may remain outside the Reserve Bank's target band of between 3 percent and 6 percent for longer than previously thought.

Reserve Bank Raises Repo Rate 50bps

Mboweni raises repo rate

South Africa's central bank raised its key repo rate by 50 basis points to 10.5 percent on Thursday, above expectations, as inflation remains above the target range and despite a slowdown in some economic indicators.

The half percentage point rise is the third this year and brings to 350 basis points the increases since June last year to tame rising inflation pressures, partly driven by food and fuel costs, and robust consumer spending.

Only seven of 19 economists polled by Reuters last week forecast rates would rise on Thursday.

But But... The World Cup!

Ah the 2010 World Cup. It's the perfect reason to buy a property for R395 000 with a tenant renting for R1 700/month. It doesn't matter if the property is located over 40km from the nearest world cup venue (with only one of the most congested highways in the city between you and the stadium) or that it has a pititful 5% ROI (before rates, maintenance and vacancy cotsts) when paid for entirely in cash. I mean the World Cup right? It says so in the ad. It has to be a good investment.

Down Payment	Monthly Payment	Cash flow	Annual Income	ROI
R0	R4769.13	R-3069.13	R-36829.56
R39500	R4292.22	R-2592.22	R-31106.60	-78.75%
R79000	R3815.30	R-2115.30	R-25383.65	-32.13%
R118500	R3338.39	R-1638.39	R-19660.69	-16.59%
R158000	R2861.48	R-1161.48	R-13937.74	-8.82%
R197500	R2384.56	R-684.56	R-8214.78	-4.16%
R237000	R1907.65	R-207.65	R-2491.82	-1.05%
R276500	R1430.74	R269.26	R3231.13	1.17%
R316000	R953.83	R746.17	R8954.09	2.83%
R355500	R476.91	R1223.09	R14677.04	4.13%
R395000	R0.00	R1700.00	R20400.00	5.16%

Property Price Growth: Less Than Cash

Standard Bank reported (via RealEstateWeb) property price inflation was 5.7% year on year. That's less than cash. That kind of growth is a death knell to speculators. They're relying on double digit inflation to make up for their horrendous rental returns, which in most cases for newly bought flats is cash flow negative before taxes, maintenance and vacancy.