It's Christmas and time for the Saturday Open Thread.
3 comments:
Goldilocks
said...
Anyone read the article on Knysna in the M&G this week?
"One just needs to drive around the industrial area and town," says Ian Stewart, a chartered accountant and proprietor of Outeniqua Financial Services, "to see how many places are empty and how many houses are for sale. I see it with clients. I see how they struggle. Things are tough."
For sale signs have become fixtures. Many are dilapidated and faded with age. Sellers try to refuse the low prices buyers offer for as long as possible. Many buyers can't obtain credit to fund their purchases. "A luxury three-bedroom house recently sold for R1,5-million, in an upmarket suburb where empty stands commanded R1-million not two years ago," says Stewart.
"Rental space has never been so readily available," he says. "Landlords are negotiating rentals at less than last year's rents. Certainly no increases are being achieved, since many businesses are just hanging on. The only increases I've seen are salary increases for municipal employees. Property sales have virtually come to a standstill, because companies are reluctant to invest in property where the rental stream is not guaranteed, while the holding costs escalate annually."
Both Simpson and Stewart attribute the vacancies to a number of factors. Steep hikes in rates and taxes and water and electricity tariffs have gone in large part to fund a R135-million salaries bill that dwarfs the town's R68-million capital expenditure budget.
Basically the entire article is about the crash in real estate and its knock on effects. Reality is beginning to set in. CT and JHB are obviously benefitting from the semigration back to the big cities keeping rentals and prices high.
I stay in Bloubergstrand in the suburb of West Beach. Protea Hotels where going to build a new hotel on the beachfront but I see now that the building site is for sale by auction. Another sign that the property market is not healthy.
That was actually a property syndication by Realcor. They ran out of money. It's basically a ponzi scheme, they were paying out investors before they actually were generating income.
3 comments:
Anyone read the article on Knysna in the M&G this week?
"One just needs to drive around the industrial area and town," says Ian Stewart, a chartered accountant and proprietor of Outeniqua Financial Services, "to see how many places are empty and how many houses are for sale. I see it with clients. I see how they struggle. Things are tough."
For sale signs have become fixtures. Many are dilapidated and faded with age. Sellers try to refuse the low prices buyers offer for as long as possible. Many buyers can't obtain credit to fund their purchases. "A luxury three-bedroom house recently sold for R1,5-million, in an upmarket suburb where empty stands commanded R1-million not two years ago," says Stewart.
"Rental space has never been so readily available," he says. "Landlords are negotiating rentals at less than last year's rents. Certainly no increases are being achieved, since many businesses are just hanging on. The only increases I've seen are salary increases for municipal employees. Property sales have virtually come to a standstill, because companies are reluctant to invest in property where the rental stream is not guaranteed, while the holding costs escalate annually."
Both Simpson and Stewart attribute the vacancies to a number of factors. Steep hikes in rates and taxes and water and electricity tariffs have gone in large part to fund a R135-million salaries bill that dwarfs the town's R68-million capital expenditure budget.
http://www.mg.co.za/article/2010-12-23-knysna-on-the-rocks
Basically the entire article is about the crash in real estate and its knock on effects. Reality is beginning to set in. CT and JHB are obviously benefitting from the semigration back to the big cities keeping rentals and prices high.
I stay in Bloubergstrand in the suburb of West Beach. Protea Hotels where going to build a new hotel on the beachfront but I see now that the building site is for sale by auction. Another sign that the property market is not healthy.
That was actually a property syndication by Realcor. They ran out of money. It's basically a ponzi scheme, they were paying out investors before they actually were generating income.
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