House Price Bubbles: Reality & Theory

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Dear Agents: Please Try Harder - Show Houses

Reader KS writes:

Agents want to know why things aren't selling? Perhaps they should look at the effort they put into show houses. Supposedly it's the best way to sell a house but of the 4 show houses I went to on Sunday, 3 were staffed by house "sitters" who had no knowledge about the place. This was a typical conversation:

Me: How many metres under the roof
Sitter: Shoo... not sure... going to have to ask the agent cos he said the pamphlet was wrong...
Me: When was the kitchen renovated?
Sitter: Ja I don't know...
Me: How long has this been on the market?
Sitter: Can't say..
Me: Is there plumbing for a downstairs bathroom?
Sitter: *silence*

Agents, if you want to sell, then get off your asses and start sitting in show houses or at least put knowledgeable people in there not brain dead idiots. I don't have the time to come back during the week just to get answers. To quote Glengarryglenross: First prize is a cadillac, second prize is a set of steak knives, third prize is you're fired.

KS sent me a link to where that quote is from. Estate Agents should be watching it every day to pump themselves up.

Brooklyn: The Palms - Specuvestors Hoooooo!

Palm Springs is a newish development that was unfortunately built in Brooklyn. There are 354 units and of those 146 belong to a Trust, CC or (Pty) Ltd. Can you say 'specuvestor heaven'?

Reader JT writes:

Bought a unit here in 2008 to let it sleep for a few years for about R 450 000

Initial levy payable to Permanent Trust has now been increased by 50% from R 300 to R 502.

Reason for this is that they never accounted for the behaviour of the low budget/illegal immigrant/5 people in a single room scenario – not to mention the gym equipment being vandalised and communal areas falling apart.

I currently let my unit out for R 3200 a month

It was a bad choice as an investment – time will tell if it works out

So bought for R450 00 and currently reanting for R3 200 gross, with levies includes it's R2 700/month net.



If you bought it for cash you're earning 7% return. If you didn't put at least R150 000 down (that's a 33% deposit) you're losing money and judging by the way the levies are going up, will continue to lose money for a while.

However there seems to be a slight problem with the rates accounts. JT continues:

Turns out the developer never properly registered the units in individuals names – so the R 4000 in rates that I paid up to Feb last year to what I was told was my account is now frozen and I have to prove that I paid it.

I apparently have a new account that is in debt to the tune of R 4500 – but I have still to receive a rates statement.

Just a little legal note, if rates are not up to date the council will not issue a rates clearance certificate and no sale can proceed. If you need to sell you're going to have to get the bottom of that rates story.

Vredehoek: Not Selling? Time To Raise The Price!

Reader KS writes:

This apartment has been on the market for at least a year at R1495000. Now it's asking price is R1535000. I guess when things aren't selling the logical plan of action is to raise the price R40 Gs.

Me thinks someone is trying to recoup some bond payments...

Saturday Open Thread - Other Cities

It's the Saturday open thread. This week's topic: What's happening in other cities? We're CT focused but if you're a reader in Jozi/Durbs/Bloom/PE let us know what's up!

Dear Agents: Please Try Harder - Woodstock

Modern Townhouse - Brand New

And from the ad:

BRAND NEW! Never been on the market.

Maybe it's never been on the market before because it hasn't been completed yet!

A New Blog To Follow

House Price South Africa

Some great graphs and insights on property and population growth.