31 October 2007
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.
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?
30 October 2007
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|
25 October 2007
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.
11 October 2007
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.
07 October 2007
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|
04 October 2007
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.