Statistics SA has released some shocking data regarding the South African building sector.In 2005 the building sector showed growth of 36.3%, this was at the industry’s peak. However, looking at data from January to December 2008 the real value of recorded building plans passed by larger municipalities had decreased by 17.2% when compared with 2007.
This is merely a continuation of the decreasing trend that has been recorded since the 2005 peak. It is also the worst recorded growth in over 20 years. The greatest affected was the residential sector but the negativity has also been bleeding through into the commercial sector.
Many homeowners are wondering when this is all going to come to an end, will the interest rate cuts that are expected help revive the market or will it be too little too late on top of all the other worldwide financial disasters.
Huge job losses are still expected in the year ahead and that means even less money will be spent by consumers to stimulate the economy and struggling retail sector.
This is certainly an indication of tough times ahead, the building sector may improve over the year but to what extent and will there be enough employed people to encourage growth. South Africa already had a major unemployment problem before the global financial crisis caused many companies to cut jobs in order to save on costs. Now with existing companies closing down and tougher lending criteria it is becoming increasingly difficult for start up businesses to get funding and create jobs.
What do you think, will the building sector improve in 2009 or will factors such as unemployment and tough lending criteria be too much to overcome this year?
One thing yes2property.com tries to do is to make people aware of the importance of being well-informed when entering into any type of property deal, be it buy-to-let, your choice of letting agent or hidden costs involved in property investing.
At this stage you may be thinking to buy an existing property and extend or improve it. What you may not be aware of is that some people in the Western Cape of South Africa are receiving quotes of over R7000 per square metre for 2009. The Western Cape is always more expensive when it comes to building costs but not by very much more than Gauteng and other provinces.
By doing a very basic calculation that would mean that a small 2 bedroom, 1 bathroom house of approximately 100 square metres will cost about R700 000 to build. This is of course excluding the cost of the land itself, if you intend to build a house from scratch.
Many people will also testify to the fact that it is usually better to go for the slightly more expensive quote as builders who charge less often cut corners on quality and employ less experienced people to do the work.
So when buying a property you intend to do improvements on make sure you get a quote from a reputable builder before you finalise any deals to purchase the property.
We all want to know what to expect when we resell our homes in the future.Will we achieve the price we are hoping for? Will the property have increased in value enough for us to upgrade when we buy our next property? The following is a checklist that will make it easier to predict whether or not your home will do well when you sell it in the future.
Almost nothing is more important when buying and selling your property than where it is located. This is because the location will determine many other factors as well. Are you buying in an area where your neighbours are respectful of your property and their own? Is it close to places of necessity such as schools and shopping areas? What is the crime rate like in that area? Many people also want to buy in an area with a nice view, future buyers will also want a nice view.
2.Size of the property
Most people enjoy living in more spacious homes and therefore it should be an asset to have a home with larger rooms or a nice big garden.But don’t go overboard and buy the biggest house in the neighbourhood as your asking price will be influenced by the average cost of homes in the area.A very large house amongst smaller houses will often fetch less than a very large house among houses of the same size.
Most South Africans will agree that the kitchen is usually a centre for activities of all kinds. Whether it is cooking, eating, art and craft projects or just plain nice to have people will more eagerly buy a property that can boast a great kitchen with good fittings and finishes.
4.The amount of bedrooms and bathrooms
Properties with between three and four bedrooms are the most popular because most people have a family to house. Gone are the days when one full family bathroom was enough. People have come to realise how convenient it is to have a separate guest toilet or an en-suite bathroom attached to the master bedroom. So houses with two or more bathrooms will enjoy preference from buyers.
You should also keep in mind that you need to be comfortable in the property if you intend to live there, so don’t buy a property just for its resale value if you know you will hate living there.This will probably only make you want to sell before the time is right and then you will have wasted alot of time, money and effort.
Unless you spend alot of time in the kitchen you probably don’t really think about your stove that often. For many years in South Africa the standard was to have an electric stove and oven. Our electricity was cheap enough to justify not giving anything else a second thought. However as we are seeing a steady increase in the cost of electricity and a steady decrease in the availability of it perhaps it is time to consider another alternative, gas.
Gas is known to be far more accurate while cooking as it allows you to control the flame very precisely when compared with a maximum of 8 heat settings offered by a conventional electric stove. This is why the majority of professional kitchens in restaurants and hotels are equipped with gas appliances instead of electric ones.
With a gas stove there is also immediate heat instead of having to wait a few minutes for the electric plate to heat up. This reduces cooking time and allows you to serve your meal to a more exact timetable. They are becoming more and more attractive each year as well and are becoming a focal point in super modern designer kitchens. If done correctly it may even increase the value of your home as many people know they can be real advantage while cooking and a talking point when entertaining.
There is no real advantage to having an electric stove except that at this stage it is still a bit cheaper. However considering Eskom’s prediction that electricity will triple in price within the next decade maybe we should start considering alternatives before gas stoves become even more costly as the demand for them increases.
I should also mention that alot of us have a real fear of bringing a super flammable explosive element into our homes. While there are rare occasions when their gas supply does explode there are many safety measures put in place to prevent this. Just like your geyser and electric wiring, proper maintenance should prevent any accidental fires or explosions. Most people drive their car for a longer period of time each day than what they spend cooking. A car contains litres and litres of flammable liquid that is constantly making little explosions but we are so used to driving them that we think little about what is going on underneath.
Give us your view on the subject.
Yes2Property.com would also like to thank all it’s readers for all their support and we would like to announce that this is our 200th article to date. We hope you will join us for at least the next 200.
We all know how frustrating load shedding can be and are all eagerly anticipating a permanent solution to the problem.Well, Eskom is planning on having a nuclear facility capable of producing 3500MW of electricity completed by 2017.
That seems like a step in the right direction and Eskom has also stated it is debating whether or not to enter into a power buying deal with EDM, a Mozambican power company.2017 does seem a long way away when we are faced with rolling blackouts on a regular basis at the moment.
Nothing is final yet and Eskom still needs to finalize the location of the new plant and the group who will build it.Eskom will take until the end of 2008 and then announce who has won the tender to build.There are two major contenders for the tender,Areva and Westinghouse.Hopefully the company who wins will remain on track as a major delay will only further extend the current situation and become extremely detrimental to the country’s future growth.
Eskom also has to take into account the environmental effects another nuclear power station will have, and they have conducted three environmental impact studies for this purpose.Oyster Bay, Duynefontein and Skulpfontein were chosen for the studies and the data collected from them will aid in the decision making process.
I suppose we can only wait for Eskom to announce the location of the new plant and then wait some more for the plant to be completed.It really does seem like a long time to wait until you find out how complex and time consuming the process of building a nuclear plant is.I would rather wait a little longer and be assured it was built correctly.
Some Cape Town residents may be surprised to find out that the cities tallest building is yet to come.Portside is going to be a multi-functional skyscraper and is to be built on the old Malgas site near the V&A Waterfront.It will run along Buitengracht street and will be walking distance from the Waterfront and other attractions.
The site was purchased by the Old Mutual Property group in May last year for more than R89m,the development of the site is projected to cost R1.2bn.The developers are hoping to include 14 500m² of hotel accommodation,33 000m² of office space, and 2 500m² of retail space.Also on the agenda for the building is that it is to be benchmarked according to the Green Building Council of South Africa’s green star rating system, giving it even an more unique edge.This will be the cities most ambitious development since the V&A Waterfront and is targeted for completion in 2011.
But not all residents are happy with the idea of an even taller building in the CBD.The biggest complaint seems to be a concern that the building will ruin the view of what the Mother City is most famous for,Table Mountain.In the past height restrictions have been very closely monitored for this reason and safety concerns about the strong winds Cape Town experiences.
While it may end up being the tallest building in the city some are saying that it won’t be that much taller than the LG building in the near vicinity.One of the reasons the city may have approved it’s construction is the increasing lack of space in Cape Town,with some arguing skyscrapers are the way to go in the future for the space saving capabilities they have.
Although I have to say it would be very sad to see the wonderful view the city is renowned for obscured by countless skyscrapers.I hope it doesn’t go that far.
The GBCSA (Green Building Council of South Africa) is a recently established organization with a serious goal.They aim to encourage developers in all sectors to go Green.This means they want to bring South Africa up to the standard of the rest of the world when it comes to building in an energy efficient,environmentally friendly manner.
Claims have been made that if their practices are followed the developments will a see a 50% decline in their energy consumption.This far exceeds Eskom’s proposed 10% reduction.
GBCSA’s main focus seems to be to promote energy and resource efficient,environmentally responsible building practices.The way to do this is for developers to maximise natural light and air circulation and reduce heat loads.They should also incorporate recycled materials,renewable resources and minimise the ecological impact of the actual development,among other things.
Currently the commercial sector of the building indusrty is more focused on these ideals than the residential sector but that won’t last for long.Apparently there are new regulations in the pipeline that will affect everyone.However going Green in your own home could be to your advantage,not only will you reduce your energy consumption but you will most likely increase the value of your home.
As the new regulations come to pass that focus on being energy efficient,homes that have already been made compliant will probably be in demand.Examples of energy saving devices are solar water heaters,energy efficient lightbulbs and insulating your home so that you don’t need an airconditioner.
Nobody said it would be cheap though.A solar water heater can cost anything between R10 000 and R30 000.But if you do decide to become energy efficient according to most experts you will then see an estimated 50% reduction in your water and electricity bill.
At some point we probably won’t have a choice and we will have to comply with energy efficient regulations but hopefully it becomes alot more affordable.
The inspection team is confident that Ellis park’s revamp is on track and it will be completed in time for the 2009 FIFA Confederations Cup.
The Ellis park upgrade started September 2007 and is expected to be finished by July 2008 at a cost of R81 million. It will be one of the venues to host semi-finals of the 2010 FIFA Soccer World Cup.
This is good news for the property market. Most experts agree that 2010 will boost property growth and that is great, as long as you have property.