Monthly Archives: October 2008

Refresh your home.

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We would all like to live in one of those houses that we see in the decor magazines,however the reality is that the items advertised in those magazines are usually top of the range,styled by a professional and cost an arm and a leg.There are a few ways to get a new updated look for your home without breaking the bank.

A fresh coat of paint is one of the first things you should consider.It will immediately refresh the interior or exterior of your home and there is such a wide variety available you will be spoilt for choice.There are many techniques out there as well and you can really have fun with it.Perhaps a focal wall in a striking colour for some fun or choosing your colour carefully to give the whole room the illusion of more space.Colour combinations can also seriously date your home,remember all those 1970′s combinations of mustard and orange?

Small items are also easily overlooked, such as the toothbrush or toilet paper holder.These small items can make or break the overall look of your bathroom.Update the small accessories where necessary but remember to keep them clean looking and water resistant.There is nothing worse than a mouldy toothbrush holder.

Then incorporate plants where you can.They immediately rejuvenate the space they occupy.You can keep it simple with greenery like ferns or give it a bit of an edge and use a cactus that flowers brightly.Here there are also as many options as you can think of.When purchasing the plant discuss what you are looking for with the shop attendant to make sure the plant will thrive where you want to put it.

Lighting is the most effective way to add ambiance to a room whether it is night or day.Choose venetian blinds for the living room to regulate the amount of sunshine you want coming in.You don’t always want the room starkly lit up.With artificial lighting don’t just go for a standard fixture in the center of the ceiling,be a little adventurous.The direction of your light source can greatly affect the way room appears and feels.These days there are also wonderful coloured lights that are great for instantly changing the mood of a room.I am not talking about disco lights,the latest are very subtle and not at all tacky.This, if used correctly, can give a wonderfully chic atmosphere and reflect your personal style easily.

So if you are in the mood for a change,or need to update to sell your home more effectively there are cost effective ways to do it.Take inspiration from what you see around you and make it your own.

CTICC to go Green.

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It seems Cape Town will soon be a contender for having one of the world’s greenest buildings.Following the global trend of transforming the way buildings are built the Cape Town International Convention Centre is set for a multi-billion rand overhaul.This is expected to be completed after the 2010 Soccer World Cup.

With high expectations for the World Cup itself we should remember that it will come to an end and we should plan for the future following it.The convention centre is already extremely popular with international tourists that bring in millions of rands for our tourism industry.

The expansion will include a hotel for the visitors from out of town and perhaps even office space.It will have fynbos planted on the roof to further emphasise it’s green intentions,wind turbines will be installed to generate renewable energy and the toilets will utilize recycled water.These are just a few of the things the developers will be implementing to increase the buildings Green status.

The development has set a goal of 6-stars,this is the highest level in Green building and will rank the Capetonian building among some of the best in the world.It will be interesting to see the knock-on effects of this decision, South Africa may become on of the world’s Greenest countries if this example is followed.

This is good news for us all.We should see a further increase in the tourism industry and all the investors out there who do short term letting should see a year round income.This is due to the fact that the convention centres activities are not related to the time of year or weather we expect.

So after the excitement of the World Cup has faded there is something else for us to look forward to.It will probably look pretty interesting as you approach it with those wind turbines,but it may just distract visitors from that unfinished fly-over in the vicinity.

2009 approaches.

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Some general news today is that Eskom has had to reduce it’s implementation of new connections by 46%.This is of course due to the capacity problems we all know about.Apparently non-electrified existing buildings will be the most greatly affected.But it stands to reason that until the situation improves fewer new developments will be given the go ahead unless they have energy efficient designs.One major stumbling block in that regard is the cost of becoming energy efficient,although most experts agree that there will be savings in the long run.Many people are very frustrated by Eskom’s continuous problems and feel that some one should have known this would happen and planned for it.Others say it is not at all uncommon for developing countries to experience problems such as this and that it is a sign of our growing economy.

Whatever your view on the subject it probably doesn’t make it any less irritating when the power goes off when you need to cook supper.What may make us feel a little better is that most experts are saying the South African economy will come through the current global financial meltdown with flying colours and go on to be even stronger.This is due to the sound financial policies we have compared to other major players in the global market.How will all the turmoil effect the current world economic giants,some teetering on the brink of financial collapse.

What we are all waiting for is the predicted drop in the interest rate that should happen in the first quarter of next year.This will free up valuable disposable household income and we will see the property market make a slow comeback after this years abysmal growth.Distressed selling will also decrease and many people will just be able to breathe easier.

As we approach the end of the year we can only speculate as to what will happen in 2009,and if this year is anything to go by it certainly won’t be boring.

Global financial crisis may change the way we view credit.

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Many people are in a state of shock after watching all the turmoil going on in the international markets.Watching financial giants like America and others teetering on the brink of collapse.We have heard of bailout plans,possibilities of shutting the stock market down temporarily and of course all the people who predicted this would happen as far back as three years ago.

Many of us are probably thinking ,”….but these people are supposed to be professionals,how could this ever happen?”.The only clear answer seems to be greed, mostly by the lenders but also the borrowers.Lenders coming up with great deals that start out fine but end up costing alot more as the months go by.Borrowers who don’t think anything is too good to be true and fall for it every time.Don’t get me wrong though,there were other events leading up to this such as sky-high commodity prices, more and more restrictive monetary policies in certain countries, and stock market volatility.

It has probably affected us South Africans more than we think.We are only starting to get into the credit crazy world that is lead by the USA ,so we should learn from their mistakes before we also go too far.The current interest rate probably makes most of us regret every purchase we have made on credit.

Where do we go from here? I say it often and i will say it again, take responsibility for your finances.Investigate anything that sounds too good too be true,even from reputable service providers as they also need to make money.Compare deals and get projections for the long term effects this will have on your finances.It may sound silly but if every person evolves a more responsible attitude to their finances this may be avoided in the future.

It may be difficult to spot something that will work for you though because lenders “deals” are getting ever more convoluted and complicated.If you feel totally overwhelmed get good advice from someone who does it for a living and has a reputation for giving sound advice.You will probably have to pay but it will be worth it in the long run.

Increase in bond foreclosures year on year.

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It will not come as a shock to anybody following the current activity in the property market to find out that a major bank recorded a 50% year on year increase in properties in possession and bond foreclosures in the month of August.

This is of course due to the financial strain most households are under due to the interest rate increases over the last two years.What is also frightening is that foreclosures and taking a property into possession are the absolute last resort lenders will take to recover their money.

With a basic figure of distressed sales increasing by 20% month on month the situation will most likely worsen in the coming months.

Statistics released by Auction Alliance have reported a 21.5% growth in the number of bonds 1 month in arrears between the first and second quarters of this year resulting in a figure of 70 000.There is also the figure for bonds that are more than 4 months in arrears for the same period that has risen from 18 000 to 25 000.

While the statistics sound pretty scary we are said to be better off than the rest of the world.This will probably be no comfort at all to those who have already lost their homes or those whose homes are in danger of being foreclosed upon.

But take heart,the picture is predicted to get far better in the second quarter of next year with the expected interest rate cut in April.

Economic summit starts today.

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Delegates came together in Johannesburg today to start the summit regarding South Africa’s economic policies.ANC party President Jacob Zuma was in attendance and his secretary general Gwede Mantashe said there were priorities that would be discussed.Some of which were land reform,rural development,job creation,health sector improvement,education and the criminal justice system.

The Governments economic policies have come under fire before by COSATU and other opposition parties in the past and most would welcome some kind of reform.

The decisions made at the summit will be included in the ANC’s election Manifesto and are being developed for the new government.Investors will specifically be interested in the policies regarding land reform and rural development.While many are still expecting a revision of the Expropriation Bill to be brought forward in the coming months.This is still a controversial subject with some farm owners being very satisfied with the deals struck with the government and others feeling their constitutional rights were being violated.

It sounds like big changes might be coming and there is speculation about changes in the involvement of the Reserve Bank and The National Treasury.We will have to wait and see what is decided at the summit and we can hope for many positive changes.

Choose your builder carefully.

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Unfortunately there seems to be a serious drop in building standards.The biggest concerns are the feelings of being ripped-off and then the emotional side of having your home full of strangers that seem to have no regard for your property or family life.

This does definitely not apply to all builders and their are many reputable companies that you can find.However you as the homeowner have a responsibility to ensure you are going to get what you pay for.This means research.Get at least three quotes before deciding on one and then don’t immediately go for the cheapest one as this may mean they are cutting corners you will pay for later.Get an idea of how much it currently costs to build per square metre and then make an informed decision.

Check if the builder you are considering is registered with the NHBRC (National Home Builders Registration Council).They also have a list of former members that have been de-registered for one reason or another.Although it does seem that their registration criteria is not very difficult to achieve.

With this in mind personal reference is always the best way to select a builder or any person that will be entering your home for possibly months at a time.Get an idea from previous customers about whether or not the work was completed on time and up to standard.Did they respect the customers wishes with regards to the work being done.Ultimately, were they satisfied? If possible try and see work the builder has done with your own eyes aswell.

Currently it seems that the NHBRC only monitors that the very minimum of standards be met.This includes stability of the consruct being built,resistance to rain,strength,protection from harmful substances and serviceability.Many people are hoping for a revision of the current legislation regarding building standards and feel that it should have been done a long time ago.The NHBRC has denied any revisions are currently in the pipeline and have said also they are short staffed and need more personnel to inspect all the work being done.

So,take responsibility for your involvement and make sure you know who you are employing by doing your research.As above,there are many reputable builders that do take pride in their work and want to build a good reputation.Keep in mind it will probably cost alot of money and will take a while to complete,so if you are uncomfortable with your choice you will probably regret it.

How your marriage affects your assets.

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Engaged couples should consider the terms of their marriage very carefully before deciding on what would be best for them.It is not like before and there are options out there that could suit your specific needs better.

Always seek professional legal advice in these matters and don’t just do what you think is expected of you.It could have far reaching effects in the future.

One of the options is to get married in community of property.This is one of the oldest forms of marriage and means that no ante nuptial contract was entered into.The basic principals are that each spouse is equal in the marriage and have equal administrative powers.Upon dissolution of the marriage,through death or divorce,the assets would be divided equally between the two parties.This sounds pretty good but there is a downside, both parties are responsible for debt incurred by either spouse.This means that even the “innocent” spouse can lose everything if creditors need payment.Before 1984 this was basically your only option.That is not to say it is a bad option,this may be just the setup you are looking for.

Then you have the option to get married out of community of property.This is when an ante nuptial contract is entered into.It will usually state that their is no joint estate and that each spouse retains control and ownership of whatever assets they enter the marriage with.Upon dissolution of the marriage they will be entitled to only the assets they themselves had and acquired.Also the assets of each spouse are independent and protected from the others creditors.This is good as it means a couple wont lose everything in the event of one partners insolvency.

Then you get a clause in an out of community of property marriage called “with accrual “.This means that any assets or growth by either or both party’s estates is to be shared equally between both parties upon dissolution of the marriage.This is good because if one partner was unemployed during the marriage they will also receive more than what they entered into the marriage with,such as a stay at home mother.

So consider the options carefully and get that all important legal advice,it can only benefit all in the long run.

Key repo rate stays at 12%.

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As expected Reserve Bank Governor Tito Mboweni has announced that that the key repo rate will remain at 12%.This did not surprise anyone as most economists had predicted this outcome for the two day Monetary Policy Committee meeting held this week in Gauteng.Also the prime lending rate was announced to be 15.5%.

Some were speculating that there may have been an interest rate cut after central banks from around the world decreased theirs in an attempt to stimulate their economies.Australia was one of the many countries to do so.

We ,as South Africans, should perrhaps feel fortunate because according to Trevor Manuel and others such a move would be unnecessary because of the policies that are in place that protect South Africas economy.Many are saying we have a resilient economy that’s security was improved by the institution of the National Credit Act and FICA.

That said,Trevor Manuel has also said that South Africa will feel the effects of what is happening in the global financial sector.But it’s not all bad,Tito Mboweni also said that there was a possible improvement for inflation in the 3rd quarter and that it may peak at 13.3%.

Hopefully we will also see that 0.5% reduction of the repo rate in December,that would give many people something to smile about.

Interest rate speculation.

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The Reserve Bank’s monetary policy committee will announce it’s decision on the interest rate tomorrow at the end of a two day meeting.The committee needs to decide whether or not to adjust the current repo rate of 12%.

There is plenty of speculation as to whether or not they may lower it because of a number of central banks around the world announcing there is a possibility that they may drop their interest rates due to the global financial turmoil at the moment.Australia was one of these countries and then surprised some people by jumping ahead and dropping their rate with 1percentage point to 6%.

At this stage concerning South Africa most economists are predicting that the repo rate will remain the same and that South Africa will not follow the example set by Australia and other countries.They are pointing to a possible 0.5percentage point reduction after the December Reserve Bank MPC meeting with no further increases or other decreases for the remainder of the year.

However an investment strategist from Investec Asset Management has said that he does expect South Africa to lower their rate aswell.

With the differences of opinion we are seeing we will just have to wait until tomorrow and hear what they have to say.There is definitely more excitement to come in global finance aswell.Over twenty central banks from around the world are expected to review and possibly make changes to their monetary policies and perhaps even adjust their interest rates in an effort to stimulate activity in the global economy.