Real Estate Investor Magazine South Africa December 14/ January 15 | Page 32

FINANCE

By Yvette Fourie

Become an Investor
and help others

Don’t get caught up in the downward spiral…

W

hen people are in dire straits they make
irrational decisions. This opens them up
to abuse and exploitation. Once caught up
in the downward spiral; stress levels affect cognitive
thinking on a physical, hormonal and chemical level.
Even the most level- headed individuals can sometimes
make mistakes, which in the current environment can
send them into this irreversible downward spiral.
Most people need personal education on a financial
management level, however, this takes time. (Why
don’t we learn this at school?) When your home is
about to be repossessed there is no time for education.
Education will not instantly ‘turn the world around.’
Research has shown that out of 18 million South
African consumers:
• 12 million are unable to make monthly
repayments to creditors.
• 8 million (out of this 12 million) can’t afford to
make debt repayment arrangements that will pay
off or reduce outstanding balances.
• 5.33 out of 8 million can’t afford other debt relief
procedures.
From 2000 – 2012, homeowners in South Africa who
received Sales In Execution (SIE) notices amounted
to between 10,000 to 30,000 per annum! The highest
was during 2009 and the least was during 2005. Even
during the boom of 2005, 12,000 SIEs were issued.
Since 2009, the average SIE notices have decreased to
17,000 per annum.
Auction sales increased over time while voluntary
sales decreased by 50% and repossessions by banks
decreased dramatically to as little as 5%. This indicates
that financial institutions are becoming more willing
to make arrangements with defaulting homeowners.
This is certainly encouraging for the greater economic
wellbeing of South Africa, however, the amount of
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December 14 /January 15 SA Real Estate Investor

(10,000 – 30,000 pa) home owners receiving SIEs is
still very high and a definite cause for concern.
The market for repossessed properties has become a
viable business venture. To consider the loss of a home
to one person and a business venture to another is
conducive to a sick economic climate causing hatred,
division, war and poverty.
Be that as it may, the amount of home owners
losing their property still justifies action. This requires
ventures that are motivated to improve lives, rather
than capitalising on the pain experienced by others. It
is expected the SIE tendency will increase over the next
few years, as the public is strained to keep up with the
increase in mere living expenses.
Because of this, specific strategies have been
developed to ‘save’ people’s homes from being
repossessed and sold, leaving them out of pocket. In
addition, various products have been developed to
start these individuals on a path toward educating
themselves on various aspects of money, property and
finance. Be careful, however, who you approach for a
solution … there are many ‘takers.’

“When your home is about to
be repossessed there is no time
for education.”
When you are in financial stress and your home is
about to be auctioned off, it is not the end of the world.
Join our program. Soon you will become an investor
yourself, as you help others out of th H