Real Estate Investor Magazine South Africa August 2013

REI Residential Building Communities Together No Profit From Electricity Allowed Cost Of Living Dampens Property Market Government will in future involve beneficiaries in the planning and building of the communities in which they live, says Deput y Human Settlements Minister Zou Kota-Fredericks. Census 2011 revealed that over 1.2 million households were living in informal settlements. This was an increase of almost 20 percent since 1996. Addressing a National Upgrading Summit in Khayelitsha, the Deputy Minister said government would change its approach in providing communities with housing. “We are now changing our approach to allow for more f lexibility, more creativity and more humanity in the way in which we work with communities around shelter.” She said this meant that government needed to become more flexible and creative in its responses to informal settlement upgrading. Johannesburg landlords have been warned that they are not allowed to profit from electricity sales and they are not allowed to pass on City Power’s service charge of R385 to tenants. In a landmark ruling, the Gauteng Rental Housing Tribunal found that landlords charging tenants an electricity “service charge” violated the Gauteng Unfair Practices Regulations and the practice amounts to a profit that they were not entitled to make. The Socio-Economic Rights Institute of South Africa (Seri) represented 80 tenants of a block of f lats in Hillbrow called Plettenberg who were being charged R385 each for the electricity service fee. This meant the landlord, Young Min Shan, was raking in a profit of R27 000 a month. According to the latest statistics released by BetterBond, the national average home price has shown positive growth of 9,3% in the year to end-June, compared with just 3,7% in the previous 12 months. However, the BetterBond statistics also show that the average home price increased by just 1% in the June quarter, compared with a 6,6% increase in the first quarter of this year. “This clearly illustrates the dampening effect that high cost-of-living increases are having on the real estate market,” says BetterBond chairman Rudi Botha. “In the past three months, the extra funds injected into household budgets by January salary increases and February personal ta x cuts have been absorbed by sharp increases in the cost of transport (especially fuel) and utilities (especially electricity). Residential Views Adrian Goslett, CEO, RE/MAX Johann le Roux, Executive Director, Propell Michael Bauer, General Manager, IHFS “It only takes potential buyers a few minutes to decide whether they like a property or not. As with most areas in life, selling a property is all about making a good first impression.” “While being elected a trustee of a sectional title scheme is often seen as an onerous and time consuming job, those who do take up these positions shoul

Real Estate Investor Magazine South Africa August 2013 | Page 23