I listened to some interviews on the way to the gym about experts’ opinions of Freedom. Added to those, it must be the day itself that got me thinking about the Freedom we enjpy.

Can you remember where you voted? Mine was at Constantia Kloof Primary School in Roodepoort. The day was 27 April 1994. The weather was a bit like today, a soft breeze cooling the piercing South African sunshine. The mood was friendly, almost jovial and even though we were, some of us thought, giving away our freedom, we were pleasantly surprised at how peaceful, efficient and sincere the whole event was. The queue snaked for hundreds of meters and our waiting time was probably about 2 hours [not bad compared with some voting stations]. The attendants, all new recruits of the newly established IEC, were proficient, smiling and understanding. A mixture of white and black, they were a demographic equivalent of the queue outside. Standing there with maids, friends, acquaintances, men, women, and a peppering of soon-to-be, black diamonds, we found ourselves making light of what was to be the next 24 years today. Many had stored baked beans in makeshift shelters, many were considering emigration, many were still afraid of each other and what harm may come to us from the hand of others. The gravitas never hit us until Nelson’s famous speech under the awnings at the Union Buildings. Since then, we have experienced the tremendous ups-and-downs of a young democracy. Some think a low-intensity war exists in our lands, others have grasped the opportunities that the downfall of the Group Areas Act [in 1992] ushered in, for some urban life has honestly changed little and for others, the entrance of freedom has not changed much by way of their poor living standards.

Somewhere in that ramble, you can place yourself. Many of us have since emigrated and view the land from afar. Others have grown and prospered despite the numerous perceived obstacles. A section of the population has grown by leaps and bounds to become the emerging and perhaps for now, the developed middle class; some 5m people it is estimated. Some have become embittered by the absence of service delivery, the most recent riots in North West Province simply a tip of the iceberg say others; promises made but stillborn,  while some prospered and others languished in degrading conditions.  State Capture with parallel government flummoxed us. How the … did we get there?  Thank Goodness that we seem to have recovered from the brink of financial ruin. To the top of the wave and the bottom of its trough, but always on the edge of what is and what could be.

And so it goes, we can all find ourselves in this beautiful and sometimes tortured story. What do we make of it? On the one hand, grateful we have been spared greater possible calamity and on the other, acutely aware that the opportunity cost of the past 10 years cannot be eradicated overnight. Excuse the correctness of the details, but I hear that SAA needs R20bn to survive and if sold, would need to fetch R60bn just to pay its debts. I know what I would do but the stakes are off the page! I attended the first Senior Executive Programme presented by Harvard Business School in 2001 with a cross-section of South African leaders. One of the lectures was pure American turnaround strategy and the lecture [advice? best practice?] was something like this: “outsource it or privatize it or close it down” if it’s losing money. The example at the time was the harbours component of SAR&H [South African Railways and Harbours.]. Afterwards, we discussed the material in small groups and I remember being, well “American”, in my approach. Suddenly, from an executive of National Treasury came the much-needed rebuttal: “What would happen if up to 60000 people became jobless overnight and had no social underpin – which, frankly compared to America, we still don’t have? Boom! Like a blow to my social and financial solar plexus, I was winded and had to go back to my mental drawing board. I still often think of that question when I ponder just how we bring about social equity in this country.

So just what is this Freedom bought through struggle and political and social compromise? Let’s explore for a moment:-

“Freedom”, said one of the interviewed on CapeTalk, “is the opportunity to self-determine.” Another added something like: “Freedom is the autonomy to decide what you want and in doing so to choose to pursue your outcomes with dignity and respect for others.”

The Cambridge dictionary defines Freedom as:

“The condition or right of being able or allowed to do, say, think, etc. whatever you want to, without being controlled or limited:

Everyone should be allowed freedom of choice (= the ability to make their own choices).

Freedom of speech and freedom of thought (= the ability to say and think whatever you want

And, current campaigning for freedom of information (= The ability to access the internet free-of-charge anywhere) (My parenthesis).”

Pretty hard stuff if we’re honest. Having had to do with poorer people, I have seen how poverty not only dims the eye but also the mind; how it consumes the person and limits their ability to see, let alone grasp, the opportunities being presented. It takes an admirable and monumental effort for a poor person to break through and make a financial success of their lives. All around us we see examples of those who have not been able to chisel through that ceiling. No wonder politics seems to hold sway for so many, and in recent times, people have died for such a place on the hills of KZN.

Freedom to own property rightfully paid for is one of the bedrocks of financial freedom. It touches who we are and what we own. It gives us the ability to borrow and to lend and houses our most precious asset, our family. On the other hand, we are going to have intense debate on the freedom to own property. Personally, I think that we are going to resolve the issue despite some very stressed societal negotiations. The reason I believe this way is not puritan, but rather because we have to find the way through as a national imperative – I personally still cannot see how expropriation without compensation is ever going to work across the board.

Freedom, like power, is not a right and may not be abused. Like we prosecute criminals, the abuse of Freedom is intolerable. Many would say that Freedom therefore has necessary boundaries. The liberals among us would disagree demanding only self-control – a kind of Nike moment, Just do it –  but those of us who have lived next to a neighbour’s barking dogs, know exactly what I mean. How much more, my freedom at the expense of others’ rights and privileges?

Suffice to say that Freedom is precious and should be guarded with our lives. Enjoying it is our privilege. It drives our inter-personal relationships. It drives our economy, the so-called Free Market principle. As such, it places people in homes and moves them whilst it ensures values for their properties. Freedom to be selfish and Freedom to help others lies in our same breath. You may not like that, but that is the price and responsibility of the very Freedom we cherish.

In closing, I have just read an advert for a local construction company and it goes like this:


A Swedish family decided to make a piece of Hermanus, the South African sun and blue skies their own, and fell in love with a Northcliff home built in 1948.”

I’m not sure where your heart is as you finish reading this blog but why don’t you just let your guard down a little, temper your complaints, raise your vision and become a part, however wavering, of the groundswell of good sentiment and willing hearts that will make this an amazing country to live in? All her people, every race, creed, foreign or local, and strata of wealth, deserve a touch of your and my good grace to make their days happier and healthier. Like you chew a good steak one bite at a time, don’t despair that the best you can manage may not change the world but could change the world around you.

Homeloan Junction commits itself to just such a path.

Yours in Property.


WOW! – The news this week has been off the charts.

The World Bank has increased the global growth rate prediction from 3.8 to 3.9%. Doesn’t look like much but extrapolated across the world, that’s huge.

CR has appointed a super-Team to trawl the leading investors for $1tn in Investment in South Africa. Some of the finest networks, the greatest minds and the cleanest hands in the country are going to be out doing battle for investment Dollars. Put behind you that the last time when we came close to such an initiative was when our erstwhile president recalled Pravin Gordhan from an investors’ meeting where $5tn was meeting to discuss SA as an investment destination.

Gwedi Mantashe and CR are making good work of the revised Mining Charter and the legal framework that gives it legs. Positive discussions are taking place to find the economically fair ground that serves social equity and investment. Find that and we come alive with opportunity and word has it, mining projects that were on hold pending the past minister’s removal by commonsense, could be released for development.

The IMF has upped the SA growth rate to 1.5% minimum and up to 1.9% for this year. You read it first in my previous blog but, hey, who cares who gets the scoop on excellent news!

Flippit, this is good for everybody. WOW!

In a country rich with heritage, blessed with resources and inhabited by beautiful people, we have so much going for us. We have speculated before on what could happen and it seems that before our eyes we are beginning to experience the unthinkable just 5 months ago. Leadership has made an enormous impact in a short space of time. Now we need rain down here!

The latest Property Barometer from FNB has some interesting news on secondary home buying. Just fyi, the reasons for secondary homes are predominantly, buy-to-let, buying for another member of the family and leisure homes. Although the smallest percentage of the overall market, buying for other family members has increased way more than the other two. I would like to focus on that for a moment.

According to FNB:

In the 1st quarter survey, it was only the 3rd and smallest motive, i.e. buying a primary residence for someone else, that rose quarter-on-quarter, from a lowly 0.37% to 2.01%. This is the strongest estimate in this small category since a 9-year high of 2.32% reached in the 3rd quarter of 2015. This “jump” comes suddenly, and the estimates for this category of buying can be volatile, so we are cautious not to read too much into it.

However, we are well-aware of South Africa’s very weak household savings rate, implying many people ill-prepared for retirement, resulting in a need for support from younger family members in their older years. The phenomenon of “hiving” (3 or more generations of a family in the same home), or in some cases buying another property for a family member, on a larger scale could be the result at some stage.

Is the rise in this survey estimate beginning to reflect the above challenges?

There are two forces at play in this sector. The one is longevity with inflation and the other, not mentioned by FNB in this survey, the purchasing for children.

Just addressing the children first, worldwide with property prices rising exorbitantly, parents are buying homes for their children. Once we received our first car from our mom and dad, but today in increasing numbers, mom and dad are buying their children their first home. Nothing fancy but a huge boon for youngsters setting out on life. The purchase takes a few forms such as outright purchase as a gift, lending money to the children and monetizing the loan as part of the income, pension or otherwise, of the parents or, simply a large deposit on the property to bring the bond into affordability. I would imagine that the use of trusts in these cases is quite normal so as to protect the asset. Those of you who follow the UK property market will know that property has moved away from the common man never mind the youngsters. In this case, many hybrids of what I have just discussed are used to fund a home for the children.

In a sense, the move to private university accommodation [student accomodation] which has proliferated in the last 15 years is nothing more than this trend. Rather than house, if it is possible in any case, your child in a varsity res, you buy a small flat and use it for the years that they study. It’s not unusual to let the other room for income for the child or retain it for a younger sibling on their way to the same institution. Student accommodation has proven to be a great investment over the years with rising yields and even capital growth. It is really sustainable as university budgets are hammered and cannot any longer build residences – by the way, the protest for accommodation in recent student protests may not simply be entitlement as some seem to think, but the very issue that accommodation is simply out of reach of the less affluent students.

Let’s finish with homes for parents. It is not longevity that causes problems with income over the years but rather, inflation. Keeping pace with inflation is hard enough as it is, but living a long time with it is a scissor grip from which many cannot escape. We find ourselves surrounded by octagenarians who are quite open about the fact that their children help them to live. Whether that be by way of housing or a subsidy or both, life on the other side of 70 is tough for most people financially. So, my reader, what do you do to avoid what is obviously on its way? Some suggestions:

  1. Those who can buy a retirement village home that precedes their needing it one day. Let to retirees who prefer to rent rather than buy when they retire, such a home does not make a great return but does pay for itself. Also, when needed, it is available fairly readily because you need to remember that retirement villages are scarce resources and you don’t just get in on the day you decide you need to.
  2. Be aware of the retirement conundrum before you have to retire. I say this because what is an obvious projection when you’re healthy can become an immediate nightmare when you or your spouse is not. It may sound radical but given that units in retirement villages are either scarce or increasing in value faster than your residential property, you need to consider down-scaling your home so as to afford a retirement unit and a freestanding home before prices move away from you and you can’t buy the unit you really want. If you do this, rent the retirement home as indicated above.
  3. Many retirement villages are Life Rights. Relatively inexpensive to acquire, a downside may be that you’re not able to rent the unit to a third party. This puts pay to the idea above and you must ensure rent-ability is confirmed in writing before you buy.
  4. If you’re reading this and you have concerns about your ability to retire in principle knowing that your genes live long, then consider selling and making the move sooner rather than later. The reason is the old issue of opportunity cost. As an example, a R5m home can cost you R8000 per month to service and maintain but sold, it can provide you R500000 per annum in a preference share. Sure you have to do your sums and will probably spend half that buying a retirement unit, but the point stands that the sooner you release funds for a smaller home and retirement income, the better you will cope with ever-increasing costs of living.

In the part of the world that I live, I see the above daily. It doesn’t just take extraneous political factors to set one’s mind reeling, you just have to see what it costs year on year to eat out to understand that many luxuries today may not be attainable tomorrow. The sooner you get over yourself and understand the new reality, the better. The exception could be significant capital growth in your current property but, when the chips are down, a Rand in the hand could be better than a double storey.

Property and life are inextricably linked at an individual level. And, so it is for Homeloan Junction. We understand the implications of what’s been discussed above and can give an answer or refer many of your questions as regards that connection between your home and your lifestyle. We would welcome such interaction and will be there with finance as required. In the final analysis, we care about our customers.

Yours in Property


It is not profound to say that good news is better than bad news but, my goodness, the statement in property that there is some good news is very profound. The reason, as we’ve discussed many times, is that Confidence is the primary yeast of mortgage book building and mortgages mean house sales. In addition, in this blog I have nailed my colours to the mast and said that Gauteng is on the verge of increasing house price movements. Good news, obviously followed up by business activity, will change the shape of Gauteng house prices. The sleeping giant will arise in my humble opinion and, in turn, Cape Town will slumber for a season. In the former, house prices are too low to represent value and in the latter too high to represent value. Put incredibly simply, selling a house in Joburg and trying to replace it in Cape Town is well-nigh impossible. I have two friends [sad hey? – just joking], who are experiencing this big time; the one Joburg to Cape Town and the other, even in KZN’s North coast developments.

This trend is highlighted in the latest FNB Property Barometer: 1st Time House Buyers. John Loos reports:


We find Gauteng still to be the strong 1st time buyer region on the one hand, and Cape Town to be the very weak 1st time buyer region on the other.


Greater Johannesburg had an estimated 1st time buyer percentage of 21.59% for the 2 quarters, and Tshwane Metro a massive 30.75%.

In the 3 major coastal metros, Ethekwini Metro had the highest rate, i.e. 20%, Nelson Mandela Bay a weak 10.5%, and Cape Town Metro a very low 6.46%

These major divergences partly reflect diverging home affordability trends in recent years. We believe that slow house price growth in Gauteng over the past decade or so has greatly improved home affordability (average house price/average household income ratio), whereas at the other end of the spectrum, Cape Town’s home affordability has deteriorated significantly during recent years of greater market strength and strong house price growth.


In short, FNB is saying that new homebuyers can’t afford the prices in Cape Town but can afford the slowed down prices in Joburg. Extrapolate that fact a few layers upwards and the middle+ markets, who are baulking at Cape prices, are seeing value in Gauteng. Really glad that we have this green shoot confirmation of above-average rising prices in Gauteng; a stance this blog has taken since December especially.

And here’s a stab in the same direction – the national GDP growth rate is going to be at or near to 1% for 1st Quarter 2018. May be naive but we should not underestimate the force of positive news on our economy.

A person who I have not had the privilege of meeting but who I admire through the Press is Andrew Cantor, CIO of Futuregrowth. Futuregrowth is a huge investor in Commercial and State Owned Enterprises [SOE’s]. It was Futuregrowth, with other significant players, who eventually refused funding to Transnet, Eskom and that other cash-eater, SAA, in 2016/7. Thankfully, we have not yet experienced the dire predictions of those times and may it remain so. But Andrew has written an article entitled, It’s not so gloomy in SA, in Financial Mail, the main points of which I share with you as an extract:

It has become all too easy to overlook the positive forces that have been at work in the country in recent years, and to underestimate the potential that exists for positive change.

It is my belief that SA has many core strengths and that its challenges can be met. I am comfortable, on a daily basis, to invest pensioners’ savings into this country.

We all know the bad news. So, to explain my confidence, I’d like to offer some perspective.

SA has witnessed a remarkable political change: a new president, new cabinet and clear evidence of a crackdown on corruption.

The Futuregrowth credit team has, since the fourth quarter of 2016, been in engagement with the six largest state-owned enterprises about issues of governance. We found that four had reasonable governance structures and practices and, subject to certain changes, we recommenced lending to them. Eskom and Transnet have been at the centre of serious allegations and these are being investigated through various parliamentary and judicial processes. Our analysts continue to be in discussions about governance and improved disclosure with both these organisations and are finding them co-operative. We have not yet recommenced lending to either.

As we look back, there are some very positive signs despite the past difficult decade:

  • SA’s constitution and judiciary have stood the test. The principles of the constitution were defended repeatedly by a free and independent judiciary.
  • SA’s incredibly free press played a critical role in creating a channel for truths to be aired and for the public to become aware of the problems.
  • Democracy itself has played a key role. The ANC suffered meaningful setbacks in the municipal elections of 2016, and the mood of the electorate was a clear warning that change for the better was vital for the party and the country.
  • Civil society found its voice through whistleblowers, e-mail-leakers, writers, academics, entertainers, financiers and others.
  • National treasury is the linchpin of fiscal control, and has a strong culture, with many dedicated professionals.
  • Often forgotten, the Reserve Bank has constitutional protection, a clear mandate and independence.
  • And SA has a large, professional and ethical investment community with a strong pension fund investment culture, legal frameworks and regulatory oversight.

As a bond investor, I deplore the weak standards in SA’s listed corporate bond market. However, that perspective can do an injustice to SA’s very strong equity market and its remarkable government bond market. Both are world class.

And we are in a unique historical position to effect positive change.

Despite good global growth in recent years, domestic mismanagement has undermined fiscal accounts and economic confidence — resulting in low domestic growth, credit-rating downgrades, and worsening inequality.

That said, the economic outlook is brightening:

  • While GDP growth estimates are still pencilled in at between 1.5% and 2% for 2018 to 2020, the rise in confidence gives a likelihood of materially better outcomes.
  • Domestic inflation remains subdued, offering scope for monetary policy flexibility.
  • We expect better fiscal control and growth to stabilise SA’s credit rating.

As we approach the 2019 national election there will no doubt be comments and cross-winds. This may be unsettling, but during my 28 years in SA good sense has ultimately prevailed.

Shew! If that does not encourage you, nothing will. Bad news will always be there. Just had lunch with British people and they are concerned about Brexit and would love to live here; how’s that? Andrew’s perspective lifts us from the gloom and places us in hope.

Do you do that daily where you touch the lives of Others?

Yours in Property.

PS – if you are looking for experienced and professional assistance with the home buying process, Contact Homeloan Junction – They take care of all the steps so that you can focus on what matters most to you.


The beautiful seaside town of Hermanus has not been spared the ravages of land invasions. The accusation is that people have waited for houses for 20 years and are now completely impatient. Having the unrest close to you is nerve-racking and our hearts went out to the peaceful residents who live in Zwelishle. As is so often the case, they bear the brunt of the ire of the crowd and get beaten and even to death [3 cases as we understand] for simply going to work. The local churches have set up Safe Shelters and we are feeding and caring mainly for those who feel completely unsafe going back home. The Housing MEC flew in yesterday to meet with the protesters and things seem quieter [27/3/2018]. Let’s hope that sanity prevails and that justice is served both for criminals who have looted and assaulted, but also for genuine cases of long-delayed housing delivery. Our Municipality has assured us that we are one of the most progressive house-building local governments so we must take them at their word at this stage. What I can say is that in the last three years many homes have been built and many are under construction, but obviously, not enough for the Eastern Cape and foreign people who have semigrated into the Cape in general. The irony of irony is always the burning of buildings – the satellite police station which could have provided protection and investigation and the other, the….wait for it…..the Housing Department. The latter holds the lists of Awaiting Houses people. So let’s hope there’s back-up in this crucial area.

All of this speaks to the Land issue with its component parts:

– Vacant land;

– Services;

– Service delivery of existing housing, and;

– Housing construction and delivery to the properly prioritized people.

To the latter pair, does anyone know if the government has completed the delivery of title deeds to the so-called “matchbox” houses in Soweto? If not, that’s a scandal of immense proportions as long-time residents of those houses could have formed a symbolic body of homeowners able to benefit from the wealth creation of their properties.

God knows, the Land issue is now worldwide. Detaches delivered to the Australian government do not help and the lack of comprehensive, understandable, compelling communication to every global stakeholder is vital. You don’t redistribute land even with compensation, never mind without, by passing a resolution at the ANC Elective Conference and then go quiet on all of our major trading and investment partners. Little wonder that the Australians, who are building a nation of highly skilled and vetted immigrants, have taken the gap of practically inviting our farmers to apply for visas. Sensationalism aside, we have some of the finest agricultural skills and expertise in the world and most certainly in a water-scarce country, which Australia also happens to be. Until we realize in Home Affairs that Skill is a globally competitive commodity, we will not replenish the hundreds of thousands of people who have left for other lands. It is not about race or ethnicity – if you stand on a Vancouver street corner, you will be shocked at the number of Asian folks who have immigrated there. Where did they come from? Hong Kong certainly, and in the face of the uncertainty of the British handover to China. Skills walk and Money talks.

Shew! That was a headful to get on paper. So why do it? Well, the price of property will be linked to the long-term affordability of our population. While everyone will not be rich, everyone can own an home appropriate to their affordability. As is obvious, the home is first of all shelter, second of all family security and sense of being, but thirdly, a source of wealth creation. We can remind ourselves that for most people, their pension and their home are their ability to retire – one or the other missing and the prospects will look bleak. We will never progress our nation until it catches the dream of the likes of Joe Slovo who set the goal to build 1000000 houses by 2000 and succeeded, even posthumously, to beat that goal. The American Dream of home ownership was not motherhood and apple pie, it was about the mighty American Dollar and the profit that could be made. In turn, it worked for all who succeeded to realise “the dream”.

Developers reading this, we salute you. You are building the national housing stock and that is meritorious. Keep it up!

The news did indeed travel fast. From Cape Town, the Vaal, Joburg, and Sydney message after message to find out how we are. So far we are good but every hour a new threat arises from people intent on destruction, another spear of fear penetrates the hearts of the people of this town and its surrounds. Let’s hope the violence dissipates and with things back to normal, houses get delivered as soon as possible.

But, there is other much better news. The Moody’s decision to retain our rating bordered on a miracle. To have held the downgrade off was a gift to South Africa. Remember that their decision would have plunged us into full junk status and to the point that the Citi World Bond Index would not have been included in offshore Bond mandates. In simple terms, $10bn of SA Bonds would have been sold off in no time. They prevented that ignominy and financial destruction just by holding the rating. But then to give us the filip of lifting the negative watch to Stable was amazing! It sets the scene for a few things that should excite us:


  • It gives the new Administration and its decrepit SOE’s a financial space to move on critical initiatives. The cost of funds should not rise and we need every Rand we can spend on turnarounds right now.
  • It gives the SARB the space to manoeuvre interest rates and I for one, am backing a decrease in Bank Rate come the next MPC. Allied to this as we have noted, the strengthened Rand also gives the SARB much-needed headroom for a rate reduction.
  • It may spur the other Rating Agencies to review their stance on South Africa.
  • Finally, it’s just some good news amidst the gloom that has succeeded Ramaphoria.


All of the above said, am I negative? No!

We live in a vibrant country that is grasping the nettle of social inequality. We will make some mistakes in our rollout and even frustrate many with the pace of change. But ultimately, we must survive and even thrive in order for our People to enjoy a developing economy. I can understand people who are cynical about this approach but we have chosen to live positively and faithfully in our beautiful, tortured country. For some there is not an option but to live here but for others, it is a choice. Either way, as in all of life’s challenges, you can be positive or negative. The decision is yours and the way you react to a stimulus will always be your responsibility. I choose to live positively and remind myself of that whenever I need to “hear my own prayers”.

HLJ agrees and we invite you to do the same. It’s not fairyland stuff, just a simple choice to be happily effective in what we CAN DO.

Yours in Property.


In this blog, we cover an issue upon which I am biased. I admit that upfront so that no illusions are created.

The issue is full title standalone housing versus sectional title homes.

The recent FNB Property Barometer gives some insight into this phenomenon and we quote as follows:

The Sectional Title Housing Market Segment continues to outperform the Full Title Segment, although the latter segment has seen its average house price growth accelerate somewhat.

The FNB Sectional Title House Price Index has remained at a faster growth rate than Full Title of late. The Sectional Title House Price Index rose by 5.18% year-on-year in the 4th quarter of 2017, having accelerated from 4.96% in the 1st quarter of the year. 

The Full Title House Price Index, by comparison, showed a slower 3.95% year-on-year growth rate in the 4th quarter of 2017. However, its growth had accelerated a little more over the year than the Sectional Title Index, from a lowly 3.18% year-on-year in the 1st quarter of 2017.

Our panel of FNB valuers also perceived the Sectional Title market to be stronger than the Full Title market in the 4th quarter of 2017.”

Let’s just analyse this trend. What does sectional title represent generally? Secure estates with smaller homes on smaller stands and community living.

On the negative side, if you don’t like people, you’re too close to the neighbours. In addition, you become liable for the community rather than your own costs. So, as per our units in a Cape provincial town, you become liable to paint the whole complex when that is needed or the sewer repair even though your own toilet is working. Of course, you don’t really feel this as a good Body Corporate will make provision for such an eventuality. In my Mom’s case, the roof is still asbestos sheeting and this needs to be replaced at great cost and with sensitivity of those living below. The financial provision is building for this to happen and even the downstairs units are contributing to the replacement. Painting is another generic cost and gardens are contained in the operational budget. In essence, everyone contributes to the common good of the complex.

So why stay there and endure all these common costs? I would put to you that the major reason is the simple human phenomenon that there is safety in numbers. Older folk feel comfortable that having a friendly neighbour provides then with a point of first call should there ever be an emergency. But for the younger folk, having neighbours, especially good ones, just creates a sense of community that you can get nowhere else. The kids grow up together, the lifts to school are easier, and the sense of security and camaraderie is expanded as people live closer together.

So, it is not unusual that sectional title properties are more sought after than standalone houses. To be honest, I’m not sure this is a purely South African phenomenon. It may well occur elsewhere. Here are some of the reasons why:

  1. Community is a modern trend. We give away some privacy in order to live in community. I have a friend with a 3000m2 stand, who has planted fully grown trees so as to avoid neighbours. But he would be the first to admit that he is unusual. Firstly, affording such a property is the realm of the wealthy and secondly, not everybody needs such reclusivity. For many, the proximity of neighbours is sacrificed for the benefits of communal living.
  2. Expenses are shared in a sectional title complex. Painting, municipal costs, security, building insurance, and Body Corporate costs eg a burst geyser, are all co-borne. In other words, when we paint, I pay just that portion of my cost that pertains to my square meterage. So I don’t need to pay for my whole property but just for that portion that I “use”. That’s neat! The same goes for security. When you drive in Inanda in Joburg and you see those guard quarters at the entrance to the property, you’re looking at R20-30000pm for 24 hours guarding. In your complex, you get that but for a fraction of the cost.
  3. The case for security goes without saying. Firstly, you have it with everyone else but you also pay less and feel safer in a complex where there is movement around you. Nothing is fool proof as my friend’s daughter who was followed right into her complex will tell you, but there is a semblance of more security in a townhouse complex than on the open road.
  4. Sectional titles can be cheaper to buy and give a better return long-term than stand-alone houses. The reason upon entry is standardization. A 50 home complex has 500 common windows, 1000 similar doors etc so prices can be negotiated by the developer that pale into insignificance compared with your non-standard, fancy windows and doors in your architecturally designed home. This what you buy – similar design, cost-effective material and building costs and often, benefits like transfer duty included in plot-and -plan sales. Really, a great value proposition.
  5. Finally, a benefit worth mentioning in an ageing population [that’s you, by the way :-)], is that old age facilities accompany communal living. Where we live, Alzheimer’s centres, Frail Care and proximity [if not on-complex] to such facilities, is crucial to the buying decision and the value proposition of community living. High demand exists in these areas as global populations age beyond their time.

There are a few property types in the communal category that bear unbelievable common-sense. My uncle taught me that properties along a ridge, with a view, and properties along a shoreline, close to the sea, are scarce. Another is the golf course and eco-estates that have sprung up. The golf course estates of course now bear the water issue. Golf courses drink water so practically no more will ever be built except at the great expense of grey water reticulation which makes the stands expensive to service. Eco-estates will continue to spring up in many different forms as urbanites attempt to escape the pressures of city living. It is therefore fair to say that these estates carry a scarcity value that bodes well for good investment returns.

Compare these benefits with a stand-alone house. In this case, your security is your responsibility, your neighbours are “next door” rather than close by and every cost of the property is your own exclusively. You may be paying excessively for privacy.

Thus, sectional title complexes have carried value over the years and have proliferated as a form of property ownership.

Property ownership remains a definite source of wealth in South Africa. The fact that you own property, never mind the advanced financial engineering of gearing properties, remains a major source of wealth creation for most young people.

In this regard, Homeloan Junction is positioned to help you acquire property. Our advice, access to the free services of the banks, and our ability to negotiate credit terms that suit your pocket, mean that we remain a leading originator in the country. We have offices countrywide and can refer you to them with any need you may have. Contact us on for a free consultation and pain-free mortgage finance.


Yours in Property.


My humble opinion? The Budget was a good one.

Flowery finmin Gigaba and his new President have inherited a mess from his predecessor. Whichever way you cut it, the Budget needed to make the best of a bad situation. We cannot but wonder how the estimated R700bn [per Pravin Gordhan’s estimate, I read] corruption and wasted expenditure could have helped at a time like this. I wrote a while ago about Opportunity Cost and the cost of the Zuma era. Added to the number, triple the cost as my guesstimate. Say, 600 people right at the top of the corruption food-chain, 500000 people waiting for direction and wondering what the hell is happening and R1trillion in corporate investment-in-waiting with all its employment potential, and you have a sense of what anything that looks like state capture or parallel-government means. It bears repeating that if ever you wondered if South Africa has a strong economy, look at the beating it has taken and that it has not utterly collapsed is a miracle. But, if I take Eskom as an example, if ever we were taken to the brink, to the edge of the abyss for the economy, then the last 10 years have taken us there.

Little wonder that Zwelinzima Vavi as a trade unionist looks into the numbers and says the Poor have been made to pay for the sins of the past. Simply put, the increase of VAT was unnecessary. We could have dropped taxes if our economy had been able to rise with the tide of favourable World growth that has occurred over the past 3-4 years. But instead, we find ourselves in a bailout of epic proportions and fighting the winds of downgrades. What a waste! And, tragically, what a long way back – Pravin said 10 years off full junk status so I hope that we are spared by Moodys and that Pravin exaggerated a little. No wonder CR takes Trevor Manuel for runs in the morning – “How did you do it back then, Trevor?” must be the question between pants for breath. But another point I have made is that I believe we can turn this around quickly in economic terms, given the goodwill that exists towards this great nation of ours. With boards like Eskom’s, the National Development Plan spoken about, implemented and measured, SASSA and its like taken off the agenda by sound execution, the appointment of a credible, competent Cabinet, good service delivery to our People, the renovation of municipal essential services, the courage to cut government expenditure and programmes that open 100000 small businesses, we would not recognise ourselves in 5 years’ time. Negativity will never get us there; Optimism will – begin to Believe, my reader!

So the technicality of the Budget in broad brush strokes after you’ve read so much already:

  • 1% VAT increase equals R30bn
  • Estate Duty rise to 20% equals a few Rbn
  • Sin Taxes and some excise duties etc equal a few Rbn
  • And, Fuel increases equal a few Rbn.

The first and the last directly, tragically affect the Poor.


In exchange for our money, we get:

  • Expensive petrol
  • More, but not enough, money for education
  • Free tertiary education for students whose parents earn less than R350000 per annum which equates to 75% of the student body
  • More security
  • Money for drought relief in disaster areas
  • A reduction in the Deficit over 3 years.


We don’t get SOE bailouts, nor competence in municipalities, nor reduced government costs nor spare change for corruption. The margin of error is very tight and no stone can be left unturned if we are to make this year count as a springboard for sustainable economic growth. The 1.4% is good but I must say, I believe we will see closer to 1.8-1.9% this year. Despicably, one of the best things we could hope for is early successful prosecutions of corrupt individuals who have stolen Rbn’s from us. The role of civil society and the courts would receive much-earned accolades when successful convictions occur. In the meantime, we don’t need to put our fingers down our throats to be sickened by the fugitives of justice and those allegedly guilty stare out from certain seats of parliament. I’m reminded of a comment Jack Welsh made when questioned about retrenchments he undertook in turnarounds. Known as Neutron Jack because he took out people and seemingly just left the buildings, he said “he should have cut deeper the first time.” This would have avoided much more pain. Horrible thought, but he experienced that if a company was suffering from bloatedness, doing retrenchments “deeply” avoided protracted uncertainty and pain as more was often required down the line. Extremely harsh, but Mr President, he may have a point for you to take.


All of the above said, the property and finance market should improve noticeably over the next two years. We’ve become accustomed to shocks just as we say that but hopefully, we have seen the last of those, at least, those we can control. At Homeloan Junction, we have put our heads down in the past few years and enjoyed the success that Focus brings. We intend to do more of the same and to do more of it with those of you on Team. They say all the boats rise when the tide comes in. Naturally true, but we’re not boats, we’re people and we can rise disproportionately given our individual effort and consistent application. We stand by to assist in that process, to be there in the tough and clinking glasses when the success comes. Don’t allow anything to hold you back from the success you deserve; You’re Worth It!


Yours in Property.


The Western Cape is in the throes of the worst drought in its history. Cape Town is about to be the first city in the world to face Day Zero. That is, the day that taps are turned off other than for strategic sites; that too, as long as water remains in the dams.

Volumes have been written about the drought but here is our take for your interest. Truth is we don’t know what will happen but some healthy insight and speculation will do no harm.

Day Zero was 11 April. This was moved to 11 May. Now, it is estimated at mid-June. The timing is interesting as nobody really knows what the impact of siltation will be in the dams. At what point will the water become muddy and at what point will the density of that mud make it impossible to pump or to purify the water to a drinkable state? Little is known about this doomsday scenario so the setting of Day Zero must be somewhat theoretical and I presume a safety margin has been incorporated in the Date. At Day Zero, all taps are turned off with the exception of key sites – hospitals, homes for the disabled and, informal settlements. The latter is very interesting as many claim the Poor have been gathering water from taps all along and it is just the Rich who will feel the pain. For those on boreholes, we trust the boreholes will not run dry. On the other hand, Cape Town foreshore hotels are pumping salt water from their foundations which are built below sea level. Now, this water is being run through in-house desalination plants to supply the hotel with pure water.

Of course, Capetonians are running for cover. A family member has installed a 5000 litre tank and has filled it with drinking water. Others have moved into Hermanus, for example, and begun to harvest water. Some interesting facts:

  •  Last weekend, looking for 5 litre bottles of water at the Spar for my son, firstly, there were none by Sunday and the manager informed me that of an order for 500 bottles, only 8 arrived. The reason is that the supplier “is servicing Cape Town first”.
  •  Rentable homes have dried up [excuse the pun] as Capetonians have rented homes to have available on the weekends for showering, washing etc and to live in permanently, if required. [Anecdote or true, the mind boggles.]
  • The Hermanus municipality has requested vigilance of your garden tap as people are filling water tanks with your garden hose and selling it in Cape Town and surrounds.
  • The Hermanus dam is just over 50% full and we have been informed that at 40%, penalties will begin to be imposed. Not too cool!


Who supplies water? To be honest, I thought the municipality supplied but they only purify and deliver from dams which are owned by central government. Key to this understanding is that Provincial government is practically only able to apply for a state of emergency and then, if they want the Defence Force involved, a national state of emergency needs to be proclaimed. Only the President can do that. In all of this bureaucracy, the use of power predominates. If the province is on the president’s side, you get action. If not, you risk abuse. There is a sense in the Western Cape that the latter applies right now. Hopefully, CR will be a better go-to man than the most recent resignee. We shall see. Point is every city in the country needs to be assessed given the recent experience and all the global warming warnings. Beaufort West ran dry and only some new boreholes saved it. Just because a town is small that does not mean it can be ignored; water security is a constitutional right as opposed to electricity which is obviously considered a luxury in terms of the Constitution. So Cape Town needs water truck aplenty immediately and the Army to keep guard and the peace at 200 water-collection points. When we’re through this mess, we need more dams or better still, water desalination plants. The aquifers are just too deep and the risk of salination of the aquifers just too high to continue to rely on deep-level boreholes. Government will need to find money for desalination plants but the PPP’s proposed by the likes of PSG seem to hold powerful promise; let’s hope sanity and competence prevail soonest. Talking to a friend in Sydney, he tells me that a “corrupt Labour government” put in a desalination plant there many years ago and now it’s a white elephant. Boy, could Cape Town do with one spare plant right now!


The political fallout has been most notable. As the Day drew near, the knives have gone out. Cape Town municipality has not covered itself in glory by any means and too-little-too-late has become the order of the day. Of course, money was a problem from the get-go but even if it was available, little was done until panic set in. Now the blame-game predominates and fingers are pointing outwards. Listening to CapeTalk for a day is enough to realise the knives are out. Mmusi has written a great article Arise, Cape Town, Arise but it truly feels like oration in the face of a possible power shift. Between Patricia de Lille and the ANC, we could see serious fallout politically.


Against this backdrop, the people of Cape Town are very interesting. There have been outstanding examples of community in the face of calamity. The school Smart Meter water saving initiative has saved millions of litres of water. Initially sponsored by Shoprite, 100’s of businesses have come alongside to fit Smart Meters at more schools across the province. A lady I heard has installed a catchment tank from her roof and then sponsored two poorer homes to do the same. How’s that for community!? However, there is something else I hear beginning to rise in Cape Town and that is Stoicism. A stoic person can endure hardship or pain without showing their feelings or complaining. That spirit, so prevalent amongst the veterans of the Wars, is beginning to rise in Cape Town. “We better get on with it” has replaced “What the hell is going on?” And you can feel its influence. Want a pedi or hair wash, take your own water. No more showering at the Virgin just get into your bucket at home as part of your 50 litres and pour the grey water on your plants you care about. To that point, businesses are deciding now to close down and let their staff work from home and be able to collect water supplies daily from the water-points – pre-planned and communicated; not last-minute panic. The farmers of Grabouw have released 10bn litres of water from their dams to Cape Town. Voluntarily and simply because they have been blessed with good watered crops so, through the danger-point of crop failure, they are taking the risk of releasing possibly next year’s water to a community that needs it now. Stoic actions displayed by people who share their compassion and grit; stoical people. I believe that that spirit will carry Cape Town through this catastrophe. Don’t under-estimate the stakes or the potential for rebellion, but somehow people are beginning to see Others as they face their own fears. I believe in that “stuff” even if my readers may have a different view. In crisis, leadership arises and people do extraordinary things. And remember, if dams normally enjoy, say, a 50% top-up to overflow by the end of a Winter, getting a 50% top-up off zero, is very different. In other words, if dams have a normal top-up this Winter, it could still occur that Cape Town runs out of water again in the Summer of 2019. Scary indeed!


As a consequence, property values will be affected. But to what extent nobody knows. So far the slowdown has just been the inevitable drain of a struggling economy and few articles I have read have evidenced the paucity of water as a reason. To that point, tourism has perceptibly been hampered and will be so until water supplies return to normal. My sense is that catastrophe will result in property price declines. Just logically this will occur. However, anything less, coupled with an improving economy on the back of recent political events, will not cripple property values. Put another way, a return to good rains this Winter will make the current slowdown a blip and a good desalination plant PPP will even raise prices slowly. Semigration will continue as few employees would walk away from a promotion to Cape Town if water is at a manageable stage.


Then, for those of us who have faith, we trust the recent rains and the political events spell a turning point in the state of affairs of our beautiful, tortured country.


Hope you enjoyed the read as much as I have enjoyed aggregating some of my thoughts about this current state of affairs. I trust that all the Doomsday scenarios will be spared and that water sustainability across the country will be part of the Marshall [Ramaphosa]Plan to get South Africans working again. Who knows so let’s just keep watching this space? As for Homeloan Junction, we understand stoicism. Anyone who came out of Sub-Prime really does.


Yours in Property.


I loved reading John Loos’ Property Barometer – 2017. John, together with Jacques du Toit of ABSA , is one of the most experienced property market commentators in South Africa. His Barometers are both scientific and appealing. Bad news when revealed, but also good when the tide turns. I am always also struck by “what could have been” if not for a few negative factors. Our president, now for years, has featured in the “what could have been” column and none the least, last year. When we think how we came out the blocks in 2016 expecting 1.2%+ growth and how, despite the technical aberration of 2% in the 3rd quarter of 2017, we only have managed 0.7%, it is good to read John quite up-ish on the scientific numbers for House Price Growth.

Let’s quote FNB and then make some early-2018 points:

“2017 saw the FNB House Price Index growing by 3.7%, a slowing on 2016, and the 3rd consecutive year of slowing annual average price growth. We had expected a slower house price growth rate in 2017, with the country’s economic growth performance having stagnated for some years.

However, monthly house price growth has been accelerating recently.



2017 turned out to be the 3rd consecutive year of national average house price growth slowdown. From a multi-year high of 7%, reached in 2014, the FNB House Price Index’s average annual growth slowed each year, to 4.8% in 2016 and then further to 3.7% in 2017.

Based on 11 months’ worth of CPI inflation data, this translates into an estimated decline of -2.4% in real terms (adjusting house price growth for consumer price inflation).

However, from a low of 1.5% year-on-year house price growth in December 2016, the rate gradually rose to reach 6.1% in December 2017, further up from a revised 5.5% rate for November 2017.

In real terms, house price deflation that had occurred earlier in the year gradually dissipated, and by November we saw a slightly positive year-on-year real house price growth rate of 0.8%, house price growth moderately exceeding CPI (December CPI data is not yet available).”

Under the circumstances, this is truly good news! Could it be better? Of course, but given the state of the economy, we could have seen:


  1. A deeper dive of the real HPI with Inflation higher and Interest Rates higher, thus depressing markets into falling residential prices.
  2. Negative sentiment prevailing in the minds of Consumers with depressing Consumer Confidence.
  3. Even more destructive politics approaching the Elective Conference.
  4. A Full Junk Status with Moody’s making its final move.
  5. Drought in the Western Cape crippling the pearler of a run on property prices in the province.
  6. The practical collapse of the Eskom cashflows.


“Bleak”, would not have been the word to describe the economic landscape. You can only imagine.


Instead, we have:

  1. A 6%+ increase in House Prices in December 2017.
  2. Cyril Ramaphosa as the president-in-waiting.
  3. The Eskom board rejuvenated with Jabo Mabuza and Mark Lamberti [the two I really know, but I’m sure there is still much serious competence] in concert at senior level firing sham re-appointments of Koko and the like.
  4. Good news coming out of Joburg’s business community despite one of their own, being Steinhoff, toxifying the air.
  5. Mike Brown and the likes inviting the ANC President to re-engage Business as Pravin had envisaged the rescue before the Junk status nightmare.
  6. Clean-ups under way in Joburg and Pretoria as fast as possible.
  7. Our SARB and the FIC free of state capture and our Treasury pulled back from the brink. You just have to listen to smooth Gigaba to realize that and, when last did you hear about Nuclear?
  8. Late but not least, some action being taken by the NPA and AFU against the Guptas.
  9. A continued stay of execution from Moodys as regards their Negative Watch for a full downgrade.

Truth be told, if the Cape Town City Council had been one year ahead of itself with the drought measures, there would be much cause for celebration.

Not the best performance of our country but certainly it could have been worse. As I said in my first blog for 2018, I am convinced that CR’s leadership will shine through and that we will see rapid change taking place in critical areas starting [with an excellent start] with Eskom.

It remains for us to be focussed and positive, using every scrap of good news to motivate our actions and be successful.

In closing on the Title’s question, is there a possible detachment between rising house prices, which generally indicate a lively market, and consumer confidence? It seems counter-intuitive to me as over the years. consumer confidence has been the main driver but there is a thing developing called “-fatigue”. Corruption-fatigue, Bad News-fatigue, Politics-fatigue, Negativity-fatigue etc. People just gatvol of everything being down-and-out and needing to just get on and live their lives somewhat normally. If you’re moving from Bloemfontein to Joburg you could sell your house and “rent for a while until things improve”. However, could it be that people are saying “this is as good as it gets so let’s just get on with life”, or, “now is a good time to buy”. Either way, unless December’s number is just a statistical aberration, there seems to be an inexplicably good rise in prices which even has John Loos excited. If I’m right, agents and originators score. If I’m wrong, I’ll apologize. But, for sure, we will have a better year than last year – that I’d bet on.

Yours in Property 2018.


This blog is a bit late for the New Year but Happy New Year in any case.

I don’t feel too bad because I’m sure most of you reading this went to work last Monday but only got to work today 🙂

Two stories from my town to introduce some points on leadership……

We have some trees above the houses in front of ours – old, tall Fir trees. When the wind blows from any direction towards the North, they make a rushing sound. Whispering Pines no doubt got its name from trees like these. They don’t bend too much but they “russhh” and have a beautiful effect on our environment.

So too, sitting on the sea-cliff paths, you can see the white horses in the distance on the sea but not feel the wind. But only a fool would think that that wind is going to stay out at sea. Sure enough, sooner or later, in it comes and it can blow for 48 hours. These last few days even bringing us some precious rains but always cooling the hot humidity of the coast.

Leadership does not stand still. It has an effect that you can sense and finally feel as it begins to change and even revolutionize the environment. Therefore some points in no particular order:

  1. On the way to Harvard in 2000 I read a book about leadership and its premise was simply that you don’t need leadership when everything is going well. It’s always good but maintenance of a status quo can be managed by managers and somewhat motivated people. When you need leadership is when the chips are down and the organization broken. The great examples are Winston Churchill who, once he had ignited Britain to fight and win the war, found himself spent in the next election. He turned a horrible time in Britain’s and the world’s history into the rebuilding of Europe. So too, many great CEO stories come off a low base as they reconfigure the company and take it to hitherto unknown heights.

Cyril Ramaphosa [CR] has the opportunity to be our Leader. Beautiful, tortured South Africa is on its knees financially and morally with more to come as the drought in the Western Cape bites with Gauteng having used their “Get Out of Jail” card last year. Broken sewerage, broken communities, broken trust, broken indebtedness, broken values, broken cities, broken corporates, broken labour relations – Broken, yet eminently fixable. Don’t believe me? Watch Eskom. Jabu Mabuza, with “unimpeachable integrity” and loads of successful corporate leadership under his belt, will make a difference. He has to; Eskom could go down in the next month.

Leadership is essential in crisis and rises to great heights in storms.

  1. Success breeds success. Leadership breeds success as well. The reason is that success, other than a one-off fluke, is the progressive realization of the positive efforts of a group of people. You see, you can channel energy but you cannot create it. If leadership was a science you and I could learn it and formulae and templates would do the trick to point a group of people in the right direction and then get them to perform – apply the formula and everybody will “do the maths”. But leadership is a social skill. Why can the technically competent not lead? Why is your best sales person often not your best sales manager? Leadership.

CR is a leader. In doing so, he plies a trade of negotiation and direction. Is he ever going to do this alone – Never! So he’s going to have to envision and motivate 10’s of thousands of people and then stop their tendency to corrupt in order to fix the municipalities, for instance. Can he do it? I don’t know but I’d bet on him as being the best of the ANC to pull it off by galvanizing resources and raising the bar of performance individually and in large groups of influential persons.

  1. Allied to point 2 is the definition of Leaders. Definitional to anything on leadership that you Google, are followers. You cannot be a leader-of-one. Self-leadership is cute and necessary but battles to be impactful. Leaders have followers that define their leadership. Followers are the foot soldiers of leaders. Those who are leaders in their own right have the duty to share the vision downwards and outwards and to coordinate its activity cross-leadership with their peers. This cross-leadership avoids silos and makes sure the left hand knows what the right hand is doing. But at some level, the need to Do becomes stronger than the need to Lead. Motivation then comes to the fore and it simply has to be given direction so as to be effective. Wonder at the mighty Blaauwkrans River bridge and you’ll know what I mean.

Followers are willing to sacrifice something to follow. Even if it is just their daylight hours that they spend working, that sacrifice we all call Work makes organizations great. An ex-CEO of Nedbank always used to say: “If you can’t lead or you can’t follow, get out of the way.” He’s right. Especially in SA Inc right now.

  1. Leadership brings prosperity. Of course, it can bring gloom as well ala Hitler and JZ but the kind we’re talking about brings wealth to the people. Social Justice looks to the upliftment of the Poor and the sense of Gain, if not Equality, between the Have’s and the Have Nots. The reason may not be entirely philanthropic but just common sense. I often say that people don’t burn what they own so ownership and belonging, in their broader context, is really stabilizing and therefore creates the environment in which people can succeed.

So the point is that if a leader is winner-takes-all and self-enriching [heaven knows we’ve seen sick examples of them in Southern Africa recently in politics and corporates], he gains and everybody else loses. Instability fails All and investment dries up as business people prefer to conserve rather than to grow. The same goes for your business as for our country.

  1. I hear some nonsense about the thought that Zuma should have won the Elective Conference so that the ANC would lose in 2019. If that were the answer to prayer that the Good Lord gave us, I would need to accept it, but why would anyone want to have another year and a half of tragic leadership for the brinkmanship of losing an election? And then you end up with an EFF/ANC coalition or something more deleterious. I’m not being political but just asking why would we want Eskom and the Rand to go to the wall [like TOTAL COLLAPSE] to have the chance to change the government. Of course, I can imagine the answer of my naysayers – “Take the pain now”; “No pain, no gain” – but what about the disastrous economic scorched earth impoverishment and social instability while the greedy get richer at the cost of our People?

Surely a reasonable man would wish Jabu Mabuza success and that Eskom keeps the lights on and enables the smelters to begin to beneficiate iron ore into steel at great electrical cost because we can do it cheaper than the Japanese? Com’on!

  1. Leaders trade in Hope. Lift the eyes of your people and you will be amazed how soon they can sense the excitement, understand the new standards and “the way we do things around here” and get on with the task at hand. I’ve said is before on this platform, you reinstate Pravin, bring Thuli in as Minister of Justice, appoint Russel Laubscher to Public Works etc and you will be shocked at how undervalued the Rand is to the Dollar. About 60 years ago Singapore – the Mighty Tiger – was practically a well-placed fishing village. National Will is an unassailable commodity and we have resources in this country to make the eyes water. No train should derail in any Metro – Ever!
  2. A final one-liner. What is written above applies to yourself, your home, your business, your province and your country. But it’s up to you and I to activate it.

I hear really good news coming from business leaders in Gauteng. Many stand by to advise government and invest in economic plans. The wind is in the trees and the white horses dancing.

I’m not a supporter of CR. My eyes are placed far above him and my hope centers way broader than his politics but I have had a little to do with leadership. When it’s bad, it’s really bad and things grind to a halt. But when it’s good, it’s really good and harnesses the immense talents even of the common man and women to the Greater Good.

Am I an old idealist? Have your view but in the meantime, let’s get on with what we can do to make a positive impact on our world.

Yours in 2018 Property.


Well, it’s happened!!

Just sitting here listening to the de-brief of what took place has caused me to rise and write this blog immediately.

I am still to write a synopsis of the property market in 2017. Those who have been reading me during the year know that I will be positive. Not in the sense that that is the stance I take as a rule but rather, that the end of the year is better than expected after our president turned the Treasury on its head for the second time in as many years. In doing so, he ignored any common sense that may have prevailed locally and internationally. His view was his view, no consultation, no permission just Guptanomics applied brutally. In doing so it feels as though he cooked his goose and has paid the price. In his own words in his scathing last speech, he is a soldier and he will march on. Man, has he left a legacy of unity at the cost of principles, and best of all, free education for all [well, 90%], which we cannot afford! Guess who is going to pay for it? – the wealthy and the Poor.

But this Elective conference which I must say has delivered the candidate I prayed for, has delivered a mixed-up unity like none other. There are people in senior Secretarial positions whose own province could not stay out of court for branch and PEC electoral distortions. Other people who have played the game of politics for politics itself – the amassing of votes in a democratic society but who probably have no one in mind but themselves. Self-centred individuals who triumph on the backs of well-intended people.

KZN could implode. What that means I do not know but I’m sure unless the leaders of the ANC pull together, that province could well continue with their low-intensity civil war. My sense is that whilst the Eastern Cape is bereft of competency and leadership, KZN is bereft of values as well. Without values, killing your tender competitor is sanctioned and if that means revenge killing, so be it. Heaven help the leaders there as they take unity to the ground and make it happen in the hearts of the people. I cannot help but think Jacob Zuma has set alight the province where he scored his greatest victory, namely, to quell the warring IFP/ANC factions in the 90″s.

The one thing I have seen all my life is that people follow leaders. Watching Colin Maine, the ANCYL leader, it was amazing to listen to him change his tune and welcome the unity that the appointment of Cyril Ramaphosa brings. What rubbish! He hated and slated the man in favour of his beloveds – jz and ndz. But how fast the change occurred as he saw his salary and his prestige swiftly flowing out the door. Will he survive the next election? I don’t know but I must say, I have seen the same shift of position happen often in Corporates. Human systems adapt to leadership. Leadership can lift the games of their followers. Or, leadership can sink their followers to the lowest common denominator. Jacob Zuma has done just that and in case you thought he’s going away, remember, he is still president of our beautiful tortured country.

So a couple of points for the property market:

  1. The Rand strengthened prior to the conference on the buzz that Cyril Ramaphosa would win. Now it has crashed through barriers last seen 2 years ago, especially to the British Pound.
  2. This strengthening movement is probably over-stated and we will need to see if it continues and then sustains. It will literally take the first few words of the new President of the ANC to shift it one way or the other. Even as President of the leading political party in the country, his stance will determine the short-term value of the Rand. If he favours the country overtly and the ANC secondly ie in private discussions, he will win us kudos.
  3. We have a downgrade from Moodys in the wings. I think Cyril Ramaphosa has just won us a reprieve.
  4. The downside, for those who wanted to win the 2019 elections, is probably that the ANC will consolidate and even win back metros they have lost. Joburg, prepare yourself for change. It will take a huge amount of scepticism and a massive amount of compromise with the zuma faction, to foresee the ANC losing in Gauteng again.
  5. Speculation aside, the win by Cyril Ramaphosa is good for property:

– The 1% growth that we lost out on this year will materialize as 2% next year.

– The drain of the SOE’s on the economy will begin [very slowly, however] to recuperate.

– It will be very interesting to see if anyone goes to jail, but I think there will be some sacrificed lambs who will do time to satisfy the populace.

– When the economy rises, jobs will be prioritized and COSATU will be manifested in all their glory in the new-birth of the tripartite alliance. That happy band of vote-winners will be in unison again. Tonight’s manufactured unity will be realized and expounded to the Press.

In summary, property will benefit and rates will decline as long as the Rand holds onto its new-found value. Slowly but surely, property will rise in price. Don’t write off that Gauteng, on the back of positive politics in a winning streak and with the fresh feel of abundant water, don’t be surprised that prices rise well above the average of the last three years. “Prepare to meet thy boom”, was how the late de Kock, the Reserve Bank Governor, expressed it.

What a Christmas present for South Africans of every walk of life! Jobs will be at the centre of a conference that Cyril Ramaphosa pulls together with Business and Economists and Others. Prepare for a Grande Plan that mobilizes for jobs – probably the most precious thing besides water in our economy at the moment.

More to come but in the meantime,

Yours in Property