Agency Shenanigans in Hout Bay

From the Sunday Times:

Facebook entries claimed Perkins took sensitive data from Anne Porter.

"This is correct," said Porter. "Debbie Perkins did steal the database from Anne Porter Properties' Hout Bay office and installed it on a Lola Kramer Properties computer. On March 15, we obtained an Anton Piller order from the High Court in Cape Town to search the Lola Kramer Properties premises. The data was found during this search and deleted. The matter has been settled out of court."

Lola Kramer, however, hit back, saying Perkins was taught to manipulate the copyright of digital showhouse pictures while employed by Anne Porter.

"The dispute between the two companies has been settled, with no damages claimed," she said.

Meow!

Suprise! Worst Investment In Hout Bay Still On The Market

The worst investment in Hout Bay is still for sale! We last saw it back in October 2008 and the asking price of R6 000 000 still hasn't changed. And with the rent locked in at R28 500 for five years (seriously what idiot land lord negotiated that lease agreement), unless you put down over R3.8 million as a deposit, you'll only be losing a couple hundred thousand a year.

Worst Investment In Hout Bay Surprisingly Still On The Market

What a surprise! The worst investment in Hout Bay that we last saw in May is still on the market. To remind you all it's a 3 bed townhouse on the market for R6 million which is tenanted for 5 years (that's not a typo... it really is 5 as in f-i-v-e years) at R28 500 a month. Which means that with a 100% bond over the five year period of the lease you will end up losing R3 163 920. Even if interest rates had to magically drop to 10% for the next 5 years you'd still end up losing R1 764 060 and you'd only need a deposit of R3 000 000 to break even on cash flow.

What a deal. I'll take two.

Rent Vs Buy: Hout Bay - Invest 3.8 Million And Make No Money

This isn't a proper rent vs buy because I would never advocate someone to rent a 3 bedroomed townhouse for R28 500 a month. That being said it's a helluva lot better than paying R79 000 a month to cover the bond on the R6 000 000 asking price. If you were stupid enough to buy this place with a 100% bond then you'd be losing R50 000 every month trying to cover the shortfall! Here's the payment and yield graph:

So if you paid the whopping R6 000 000 asking price you'd end up with a 5.7% return on investment, probably 5% less than the rate of inflation in South Africa. Just to break even on cash flow you need a massive deposit of R3.8 million! I repeat: to make no money at all you need to put down nearly four million Rand. If you had say put that R3.8 million in a money market account paying 10% you'd at least be making R380 000 a year. Even with a 50% deposit you still require 2.2% capital appreciation to not lose any money at all.

And of course there's the fact that we have not taken into account rates (about to go up), levies (which will be considerable for a security estate in Hout Bay) maintenance and vacancy.