A look at the Cape Town property market.
I know an oke who sells ladies leg cream to high end salons and makes R100k per month.He watches the deeds register and he says that the property market is "dead". He says that typically volume contraction precedes price declines in tha property market, so he expects the property crash to get underway soon. He does however hasten to add that a particular class of property, that which services retirement villages, is expected to hold its value. He says that it is not ALL retirement villages that will hold their value, but only the really well run and exclusive ones such as Darrenwood Village in Cresta Johannesburg, where you can expect to pay R 1,800,000.00 for a retirement unit (if you are lucky enough to get one).Anyway, that's what this oke reckons, for what its worth.
Thanks Anonymous. Now you can go back to your day job as Head of Marketing for Darrenwood Village in Cresta.BTW, what I don't understand about your post is how these retirees are going to be able to buy into Darrenwood when they'll have all their capital tied up in unsellable homes.
Dear BeanbwahahahahahaAll written tongue in cheek, of courseThat said, I abhore accountants of all hue - nothing personal, you understandIt's just that I know this oke who sells ladies leg cream to high-end saolns, and he makes over R 100 k per month, and he says that accountants don't know jack shit about business, they just know how to measure the reults thereof, which is of very limited valueI agree with him for all the above reasons, but also because accountants also have very limited sense of humour and often fail to "get" the joke
BeanPS: a very small portion of retirees will NOT have capital tied up in their unsellable homes, and these are the ones moving into Darrenwood Village.That, my dear fellow, was the whole point.That was the point that my friend, who sells ladies leg cream to high-end salons and makes over R 100 k per month doing it, was trying to make
The upmarket Silverwood Retirement Complex in Southern Suburbs, Cape Town apparently has a waiting list of approximately 800 people to get in. Friend had to liquidate an estate which included a place in that complex. Took almost two years before it was sold. That doesn't say much about the financial health of the waiting list...
Leg cream salesman's point reminded me of the current neo-feudalism. I found an article written recently about it. Now that the property boom is over there will be the old meaning found in the word bond [as in tie] as well as mort-gage [from the French - until death]Here's an even better word: peonage. It always amazed and confused me how everyone in America [read western world] is obsessed with their credit rating. It's almost as if people don't realize that credit equals debt. Debt is something that people have feared for thousands of years, because unlike Americans today, historically debt was always associated with another scary term - slavery. Debt bondage, indentured servitude, slavery, they all mean the same thing. Yet somehow the establishment has convinced us that the ability to "manage" our slavery is something to be proud of. They even have a rating system for it.I'm not being facetious. Being heavily in debt means you don't have the freedom to quit your job. People who have lost their job are unable to move because the enormous debt tied to homes they can no longer afford.Being tied to a piece of land is the definition of serfdom.
Remember the difference is being able to buy outright or hock oneself for 20 years or more.
Dear GoldilocksI know an oke who sells ladies leg cream to high end salons and makes R100k per month.He says thanks for the post
A telling factoid Goldilocks - until death indeed.Iv'e moved out of the slum BTW guys, now renting a lovely bachelor flat on Devil's Peak. Landlord is an old school friend that took pity on me (and obviously never read my critique of his investment strategy). Now the proles are cleared to rise up and Uhuru can commence. I'll be watching the smoke while sipping margaritas on my balcony.Maybe some civilized, clean, safe(er) and uncrowded living conditions rented for a reasonable sum will soften my opinions on you lot.
BennyDo you make over R 100k per month?I thought not!So why are you opining all over this site?Have you no decency?
I knew I guy who knew a guy who made 100,000 a month selling leg cream, but his constant jokes about leg cream and 100,000 a month wore so thin so quickly that I eventually had to tell him to fuck off or shut up.
I agree. This 100 000 guy does sound like a social delinquent. All blogs attract them, and probably deserves some pity from those blessed with higher intelligence.
It looks like the view on property is becoming a lot more realistic:Rode: House prices to fall 15% in real terms over the next five yearshttp://www.fin24.com/Money/Rode-House-prices-to-fall-15-20110818L.S
Only 15% over 5 years - obviously Rode is not looking at this graph- http://tinyurl.com/6hr7ewqUnless he believes the 50% real price fall needed is going to drag on over 20 years ... which is not how crashes play out.We are about to hit the "fear" stage - that usually involves plummeting real prices.
We have a black swan ready in the wings it seems. The Fed M2 money supply grew at its largest rate this week equal to 911 and Oct 2008; the only times it has grown this quick. The Fed is throwing money at something...big money...and i mean really big money.You all have seen gold functioning. As it surpasses platinum and leaves silver behind you may wonder why? Isnt platinum rarer and the silver market smaller?Its not about that my friends. Central banks have chosen physical gold and it is to this that the value will flow when the all paper experiment dies including etfs, etns etc. We live in a physical world, not a paper matrix representing the physical world.Because gold has no utility other than as money it does not distort economies or markets as value flows toward it. The same cannot be said for commodities like silver, platinum, oil, wheat or even things like property or the swiss franc or dollar. The price can go to infinity.
Hi C.J.Nice graph but please update it because October 2010 was quite a while ago to be considered current.L.S
For the updated chart go here http://tinyurl.com/3olkqt2First graph down takes us to June 20116 graphs down show the long term real price since 1966 - notice the long term real price average is about R500,000. Factor in that there is always an overshoot and R400,000 seems like a reasonable bottom ie a 50% drop.The bull trap is resisting going to the point where it falls out of the sky ... interesting ... maybe someone is trying to desperately massage the figures - it won't help - you can't fight the cycles - this graph HAS to go back to R400,000 in the same way that low tide follows high tide ...
Post a Comment