Ho, Ho, Ho… probably the most famous sound in the world of laughs. Father Christmas on the sleigh to deliver presents to good kids and by the way, I heard from Richard Cock [of orchestra conducting fame] the other day that Rudolph the Red-nosed Reindeer is female. The reason given by a kindly lady writing in to a radio show was simply this: Who, but a woman, would pull a fat guy in a red suit all around the world on one cold night and never get lost because she asks for directions? As a guy, I must admit, she’s right!

So with that, let’s set off with the last of the L’s in L-I-F-E which is our acronym for 12 blogs. Laugh, the verb, or Laughter, the noun, is crucial to all we do. We don’t even want to think about when we don’t laugh – sadness, depression, mourning, “the morning after”, etc – all the times when a laugh does not crease our lips. A smile is a laugh without sound and both pucker up our faces into something very different from our normal looks. A smile we learned from Mother Theresa in a recent blog is “the beginning of love”. It’s really hard to think of a time or occasion where a smile would not bring another to someone else’s face.

Remember the old song by Nat King Cole: [Music by none other than the famous comedian, Charlie Chaplin]

Smile though your heart is aching
Smile even though it’s breaking
When there are clouds in the sky, you’ll get by
If you smile through your fear and sorrow
Smile and maybe tomorrow
You’ll see the sun come shining through for you

Light up your face with gladness
Hide every trace of sadness
Although a tear may be ever so near
That’s the time you must keep on trying
Smile, what’s the use of crying?
You’ll find that life is still worthwhile
If you just smile

That’s the time you must keep on trying
Smile, what’s the use of crying?
You’ll find that life is still worthwhile
If you just smile.
Beautiful, hey?
And then the one my Dad loved by Louis Armstrong:
When you smilin’, when you smilin
The whole world smiles with you.
Yes when you laughin’ oh when you laughin’
The sun comes shinin through.

But when you cryin’, you bring on the rain
So stop your sighin baby, and be happy again
Keep on smilin, keep on smilin baby,
And the whole world smiles with you

Oh when you’re smilin’ keep on smilin’
The whole world smiles with you
Ah when you’re laughin’ keep on laughin’
The sun comes shinin’ through

Now when you’re cryin’ you bring on the rain
So stop that sighin’ be happy again
Keep on smilin Cause when you’re smilin’
And the whole world smiles with you

The great big world will smile with

The whole wide world will smile with you.

So, just a serious moment before we laugh again with the muscles we use to smile. Aunt Milda, of internet chain letter fame, says it takes 26 muscles to smile and 63 muscles to frown. Others say it’s the other way round but who am I to argue with Auntie Milda. Point is, “when you’re smilin’, the whole world smiles with you”. So what does it take to Laugh? I haven’t a clue. So, back to the mother of all Info… Mrs Google and you, Mom – yes you, the maker of the best peanut butter and syrup [sugar-free] sarmies: Laughing can sometimes be completely involuntary and involves a complex series of muscles, which is why it’s so difficult to fake and also why an active effort is required to suppress laughter.

In the face, the zygomaticus major and minor anchor at the cheekbones and stretch down towards the jaw to pull the facial expression upward; on top of this, the zygomaticus major also pulls the upper lip upward and outward. The sound of our laugh is produced by the same mechanisms which are used for coughing and speaking: namely, the lungs and the larynx. When we’re breathing normally, air from the lungs passes freely through the completely open vocal cords in the larynx. When they close, air cannot pass, however, when they’re partially open, they generate some form of sound. Laughter is the result when we exhale while the vocal cords close, with the respiratory muscles periodically activating to produce the characteristic rhythmic sound of laughing. The risorius muscle is used to smile, but affects a smaller portion of the face and is easier to control than the zygomatic muscles. As a result, the risorius is more often used to feign amusement, hence why fake laughter is easy to detect.

So, now you have it. The risorius is the main smile muscle and one of Aunt Milda’s [I’m sure Google left out “at” in M[at]ilda’s name] 26 muscles, but I can tell you, a laugh involves the zygomatic muscles and all of the thoracic and oesophageal [read: throat, neck and windpipe] muscles as well. So if you’re ever in doubt, don’t smile, just laugh. That’s funny, hey ? Thank goodness for emoticons – what would the world be without them? With all these riso-zygo words, I can imagine why colonoscopies are so much fun…ha,ha…the other most written laughs…right up there with he, he… The one serious thing that did strike me was the fact that the very anatomy of laughter is the reason why it’s hard to fake a laugh. How many micro-aggressions have we perpetrated with a cynical, horrible little smirk of a non-attempt-to-be-funny laugh? How many people have I hurt because they knew I was not being humorous at all?

Then there’s another side to laughing, and its close cousin cheerfulness, that is often quoted. Proverbs 17:22 says: A cheerful disposition is good for your health; gloom and doom leave you bone-tired [Message]. Nothing destroys the soul like miserableness and that’s why I say so often in these blogs in so many words, that you’re not truly happy until you’re encouraging others to be happy too. Your broad smile, your loud laughter even in the face of bad news and discouragement, rub off on others. Have you ever listened to a recording when someone just giggles and laughs for minutes long? Eventually, you’re just laughing and laughing at their laughing and it’s so funny that you and everyone are listening, just laugh at laughter. When last did you have a great belly laugh, one where you split your sides or had a little touch of embarrassing incontinence that just made you laugh all the more…

Got the picture? One of the muscles that relax when you, well, “hose yourself” is around the bladder. Use it and then lose it – it’s seriously funny 
Perhaps the guy who teases us the most and makes us laugh across racial boundaries is Trevor Noah. He goes on and on about nothing, but in the process, he rips off every guy, girl and nationality in the audience. Why does he get away with it? Humour, and especially the ability to make us laugh at ourselves. Evita Bezuidenhout, Tannie Evita to some, the former ambassadress of Bapetikosweti, does the same for us. As she takes the mickey out of politicians and every sector of our divide; we laugh at ourselves. She saw us through the dark days of apartheid and Trevor may be doing his own part in these dark days of a reviving democracy. When asked where Pieter-Dirk Uys got his inspiration he replied, I read the newspapers. That’s funny!

In this bumper edition before Christmas, a stack of quotes for you to read and apply:

Smile, it is the key that fits the lock of everybody’s heart.
Anthony J. D’Angelo

If you’re not using your smile, you’re like a man with a million dollars in the bank and no cheque book.
Les Giblin

Use your smile to change the world; don’t let the world change your smile.
Chinese Proverb

If you see a friend without a smile; give him one of yours.

Keep smiling, because life is a beautiful thing and there’s so much to smile about.
Marilyn Monroe

Let my soul smile through my heart and my heart smile through my eyes, that I may scatter rich smiles in sad hearts.
Paramahansa Yogananda

Nothing you wear is more important than your smile.
Connie Stevens

Smile, even if it’s a sad smile, because sadder than a sad smile is the sadness of not knowing how to smile.

If you have only one smile in you, give it to the people you love. Don’t be surly at home, then go out in the street and start grinning ‘Good morning’ at total strangers.
Maya Angelou

What sunshine is to flowers, smiles are to humanity. These are but trifles, to be sure; but scattered along life’s pathway, the good they do is inconceivable.
Joseph Addison

You don’t have the power to make rainbows or waterfalls, sunsets or roses, but you do have the power to bless people by your words and smiles. You carry within you the power to make the world better.
Sharon G. Larsen

And finally:

Give yourself some slack. Don’t take yourself so seriously, nobody else does
Jack E Trevena

Yours in Property.


We’re continuing with our series about LIFE, using the acronym, in the last blog we looked at Live [and a-Live]. I really appreciated the feedback from some of you! Today, I’m going to write about LOVE. I remember once being in the UNISA library looking for a book on Smiles and to my surprise, I found there were 8 books in the library. Imagine how many books have been written about love and loving, but I would like to raise the bar using the Good Book’s definition of Love which I have adapted into a quiz for which the answer is Yes or No. As you know, if you’re above a certain number of Yes’s, you’re awesome and if you’re below a certain number, well, you have work to do. In between, you can decide…

Here we go:

  1. Are you patient?
  2. Are you kind?
  3. Are you jealous?
  4. Are you boastful?
  5. Are you proud?
  6. Are you rude?
  7. Do you demand your own way?
  8. Are you irritable?
  9. Do you keep a record of being wronged?
  10. Do you rejoice about injustice?
  11. Do you rejoice when truth wins out?
  12. Do you never give up?
  13. Do you never lose faith?
  14. Are you always hopeful?
  15. Does your love endure through every circumstance?


So, here is the score table:

>12, You’re awesome!
<12 and >6, You may need some work!
From 0 to 6, You have lots of work to do.

Hope you did well against the toughest definition of Love that I know. Jackie Pullinger, a missionary doing an amazing work in the gang- and drug-infested areas of Hong Kong, says “you need hard feet and a soft heart” to really love. Anyone who has an addicted relative or who have endured hardship in their life of different kinds knows she’s right. Of course, if we’re honest, we don’t normally take the definition of love that seriously in our lives. Words like “awesome” and “amazing” roll off our tongue. Love does that as well. “I love that book, I love that movie, and I love that car”, are so common that we just accept it as a term of speech and never an exaggeration.

American movies and sitcoms continue the yarn as people fall in love, make love and drop out of love with regularity. So our world becomes love but the superficial kind. Heaven help us if someone protests in the street! “Those guys”, become the subject of anger and “last time they did it”, the measure of their wrongs. It’s really hard to really love but sometimes, we have to step up to the plate and hold onto love with a passion that even begins to surprise ourselves.

I have a friend who tells me that we hold others accountable by their words and actions and ourselves accountable by our good intentions. Identify with that? “But I didn’t mean to…”, “But you are misunderstanding me…” etc – how I hear myself saying that in defence of myself. My intention was noble, but my execution not quite there. At those times we expect to be loved and forgiven though often, that’s not as easy as it seems.

Enter a minister who taught me much as a younger guy. He said that “love is an act of your will”. Now that’s interesting! You see if you buy that then all the good or bad emotion, all the good or bad feelings, and all the good or bad self-talk gives way to a choice. Crazy, but many self-development speakers will tell you that the only autonomy you truly have in this close-knit, interdependent world, is to choose how you react to something or someone. I know someone who is the best at “Let it go” of anyone I know, including myself.

She just sucks “it” up and seems to do it with everything that crosses her path. She really is a great example to me. You see, I have a belief that you never need to forgive what you accept. Think about it, if you are aggrieved by something and you “lose it” with the thing or the person, you then need to forgive, say you’re sorry and move on as best you can. “I can forgive, but will never forget”, becomes our mantra. However, if you somehow genuinely accept the person or the circumstance and learn a level of tolerance, you never get angry or “lose it” and you don’t need to say, “I’m sorry”. You literally accept the person or circumstance and, if you’re really good, you just take learning from it and handle the situation better next time.

Another thing about love is that it is created in sediments. Think of the Slasto floor covering we used to have in our homes. It was the result of layers and layers of wet sand compressed over centuries. Imagine a world where your consistent acts of service to those you love to build up into solid layers over time. Though separately weak and brittle, compressed layers become as hard as rock. However, it takes time and consistency to build love so purposefully. Like gym, one session doesn’t cut it but slowly over time, you start to see the change. Just so is it with love, as kindness upon kindness builds up and becomes solid and secure in a relationship. Sadly, the opposite can be true of many relationships and unspoken issues and hurts can become seriously rock-hard and be the cause of misunderstanding and antagonism. None of us are exempt in any of our relationships and we all have experienced both with those we love and who love us.

Remember, that as serious as love is, it is also fun. If you’ve lost the “feeling”, then watch youngsters “fall in love”. Why would something so emotional and chemical, be termed “falling” if it didn’t feel like that? Falling for someone is one of the cutest things that can happen to anyone – rose-tinted glasses, flutters, sparks, innumerable messages, and thoughtfulness of the highest order and going seriously out your way, are all signs of love. I remember my Dad coming in and telling my Mom that he had bought me a car. It cost R350 and was a 1968 Volksie. I used to drive it from Potch to East London through the night whenever the army let me off. I had to wear my boots and Grey coat in winter, because the cold air came in at the pedals and froze me., but on the other side in East London, was the most beautiful girl I had laid eyes on to that time. Huh, then she dumped me and my world fell apart; really, I promise! Just like you, Reader. But from the ashes of my broken, bleeding heart, or as the song goes, “my achy, breakie heart”, I fell in love with my beautiful wife.

Life and love turned out to be very kind to me. And so the cycle goes on and I watch my son falling in love, getting married and completing the circle of life and love. Oh, and by the way, grandkids then come and hearts melt all over again. I see these crazy grandparents all around me – thank goodness for Skype and digital spogboekies! Lekker, really lekker to see love going full circle and making people happy and committed and just having fun in all the emotion and feeling. Love is a beautiful and amazing gift to the hearts of men and women. And what about our pets? – ag shame, they’re beeauutiful too!

In closing, some great quotes that sum up so much of what’s been said…

Love is just a word until someone comes along and gives it meaning. -Paulo Coelho

To love someone is nothing, to be loved by someone is something, to love someone who loves you is everything. -Bill Russell

When you love someone, you love the person as they are, and not as you’d like them to be. -Leo Tolstoy

Gamble everything for love, if you’re a true human being. -Rumi

Spread love everywhere you go. Let no one ever come to you without leaving happier. -Mother Theresa

Let us always meet each other with smile, for the smile is the beginning of love. -Mother Theresa

Love you All!

Yours in Property.


I’m sitting here looking out on my garden through newly cleaned glass stack doors and the sun is bright, the wind almost nothing and everything is shiny after the rain a day ago. Birds are tweeting and the francolin is screeching over her chicks; even our yappy dogs in the neighbourhood are quiet. Our sausage dog has got the idea: peace and quiet in abundance. Imagine the picture I’m looking at. Close your eyes. Take a deep breath… and another. Take 8 more. Keep your eyes closed and listen to your breathing. Feel alive. Feel refreshed. Feel you.

I’m tired of rehashing the same old news. I discussed this with Vincent and he suggested I run a series on a topic where we all can learn and re-think our lives. I’ve chosen LIFE as the acronym and will write 12 blogs on the inspiration I receive per letter. If something strikes you anew or afresh, tell me. I’ll take your emails with pleasure. If it bores you, tell your partner, or rather, don’t read it 🙂

I’ve just realised Live and Live are spelt the same, but pronounced differently. Live is the act of living and speaks to action, location and relation. Live, if we’re honest sometimes, is what we do. We speak about the rat-race as though we’re looking in on it. We seldom really picture ourselves in it other than when we’re exhausted. Then we tend to feel like we’re a rat in the race. We’re paying bonds, running teams, making kids [just had to put this one in delicately!], making other people happy, putting on a brave face, being nice to people who are bugging us, buying, eating, studying, lending, selling ourselves in service, driving, running, exercising, …do I have yours yet? Just add it, You know what I’m getting at.

We live in a place that FICA wants to know ten times a year. We live in relation to those whom we love, befriend, serve commercially, and fight with. We live with responsibility, duties, accountability, and legality – all connected to the previous relationships and those beyond like our banker, SARS, Home Affairs, doctors, hospitals and insurance companies. By all means, add your own. Then, we have all the media such as news media, social media, marketing media, professional media and every other instruction we get with our new toaster. It is little wonder we feel bewildered at times, tired most evenings and experience the brevity of weekends too soon. To live is hard work and to breathe, as we did above, seems cheesy when you’re so busy.

Live [or, a-Live, if you prefer for the pronunciation], is a biological state. When we live, we breathe, we urinate; we touch, smell, see, taste, hear and think. Dead is the opposite of live and, if you’re reading this, you probably still are alive. Being alive enables us to live – sounds really obvious, but if all live does for us is enable us to live biologically, then we probably look like the person I described above. Enter the higher functions like instinct [which I really believe is the 6th sense, especially for women], common sense, choice, imagination, positive and negative thinking, perspective, direction, purpose, meaning… got yours yet?…and live becomes a-live. Now the total man or woman begins to appear. Ask Vincent the difference between the two – a little baby is born having been attached biologically to her mother. Dependent, screaming, suckling, looking and moving; the baby lives and is a-live so she begins to take on a form that will shape her entire life. Indeed, nature and nurture kick in the day she knows she exists and I have no other word but Miracle to describe that.

So live and live co-exist. They together give us life and living; the one inseparable from the other as we go about our lives. The real issue for us is how to live and come a-live? How do we do that every morning and what does it matter to others whether we fail or succeed? Me, Mine and Ours – self-centeredness of the highest order. Or, Me, Mine and Others to the point of self-sacrifice? Neither is possibly correct, but both call for our attention. Rather than give you a 10-point self-help plan, here are just two things that I’d like to share. The first is, be kind to yourself. The first person I mention, even if it is you most of the time, is doing her best with cards life played her. You may think you’re just coping, but those who depend on you probably see Mom, Wife and Estate Agent; roles that are chosen and lived out with so much dedication.

Don’t allow ingratitude, the sense of being used, anger directed at you and sometimes, the nonchalance of a teenager to be the sole source of your validation. Like me, and many around me, age may have ploughed some wrinkles on your face but so have smiles. Grey hair is inevitable for most of us; in fact, turning grey is simply the hallmark of the next stage of your live-ing. Being kind means looking after yourself, forgiving your past and just learning from it, taking deep breaths purposefully especially when you’re tired or aggravated and then perhaps increasing that to something that really makes you breathe deeply, like walking. Being kind to yourself is not a cliché nor is it cheesy. I’ve made some bad mistakes and if I dwell on them, being kind to myself does not come easy. We all have, and often need the word in season, to be encouraged to have deeply regretful but, nevertheless, learning experiences. Let kindness to yourself make the days you need it to and make the life of gratitude you want to live.

Another simple thing is Others. You see, you may be in the stage of Success – pay the bond, educate the kids, grow your career, support your partner to grow hers. It’s hectic and any calmness I may feel today completely belies the franticness of this stage in my life. Bob Buford, in his book called halftime [a must-read for 45-plussers], calls this stage, success, but perforce, this stage gives way to significance. Sooner or later, our need for speed, gives way to the great life questions: Why am I here? Is this all there is? Where is this sense of my own mortality going to? Seeing this positively, success gives way to significance and significance, for many of us, implies something to do for others. Grandkids, animal rescue, charities, the sick, the homeless, the poor, ageing parents and many other causes [for Buford, the raising of the education bar for schools in America’s poor suburbs – sound familiar?], start to take pre-eminence in our lives.

All of a sudden, we’re empty-nesting and post-menopausal [men as well!!] with time on our hands, the bond is paid and, frankly, most of our earning potential is behind us. Suddenly, significance takes on the meaning and all that stuff like “leaving a legacy” starts to kick in with the time to apply ourselves. Others become meaningful and my closing suggestion is, start thinking about significance now – retiring and then wondering why you’re bored is honestly too late and time wasted. This beautiful, tortured country of ours has tons for people as skilled and connected as you and I, to do. Meaning follows other-centeredness like light follows dark, in my humble opinion.

A closing thought [adapted from a wonderful prayer doing the rounds at the moment on social media]:

This is my prayer for you,
That negative people will be kept at a distance,
That you will be defended,
That you need not be defensive when your name is mentioned,
It’s better to walk away than to live in tension.
But listen to me, I pray that you’ll live life intentionally,
When someone is down you’ll be a friend in their need,
Serve others before you serve yourself.
I pray you’ll live for more than the pursuit of wealth,
That you’ll live vertically and keep your eyes off the horizon,
That you’ll walk high in your worth and let no one tell you that you were made for less,
That you spend your life looking forward and not back,
That you’ll give and get blessed,
That your life is long and your nights are calm,
That your spine stays stiff and you live to fight on,
That you’ll find something for the unique you to believe in,
And that your legacy lives on.

Yours in Property.


Boy, do we have an interesting market at this stage in the game.

Our gut would tell us that the property market is slowing. Recession, politics and pessimism [RPP] all seem to indicate the obvious, but in some of the recent reports received from Homeloan Junction, some great contradictions appear to be happening. Make no mistake, the general trend is downwards from both the estate agents and the economists, but let’s see what jumps out of the woodwork to encourage us.

The following extracts are used for explanation and then I will make brief comments on some of the aspects:

First of all, the ooba ORIGINATION OVERVIEW: SEPTEMBER 18 tells us that “the Bond Application Intake for September 18 was 10.8% lower MOM and 8.9% lower YOY.  Cumulative volumes for 2018/19 are 10.8% down on same period 2017/18.”

Guys, if we had “suffered” that level of reduction in Sub-Prime [2008-2012], we would have been ecstatic. Most of us were down 90% by January 2009 from the height of July 2007. 10% is surprisingly good given the level of RPP in the market right now. I bet many origination consultants with good estate agent relationships have not yet felt any marked decline in their business. Admittedly, the issue is always pipeline and when that begins to drop, watch your step.

FNB’s Property Insights report, covering the FNB Estate Agent Survey’s 3rd Quarter 2018 indicates this slowdown:

“The 3rd quarter FNB Estate Agent Survey points to a further weakening in the housing market (and perhaps economy too) in the near term. A broad declining trend in the Residential Activity Rating started in 2015 and has continued in the most recent quarterly survey.

From a multi-year low of 5.35, seasonally-adjusted, in the 2nd quarter of 2018, the Activity Rating declined further to 5.12. On a year-on-year basis, the indicator went deeper into negative rate of change territory, from -7.21% in the 2nd quarter to -9.2% in the 3rd quarter.”

The direction in the rate of change in the Residential Activity Rating correlates reasonably, though not perfectly, with the direction in the rate of change of the OECD and SARB Leading Business Cycle Indicators for South Africa, sometimes even leading the Leading Indicators with directional changes. Both indicators thus point to an economy still in the doldrums, with weakening in the near term a possibility.

Agents point to further deterioration in market sentiment post “Ramaphoria”. Those that cited “Positive Consumer Sentiment” in the 1st quarter of 2018 were a far greater 56.7% of survey respondents. In the past 2 quarters, however, the response has deteriorated markedly. By the 3rd quarter 2018 survey, those respondents pointing to “Positive Consumer Sentiment” had dropped back to 9% of total respondents, while those pointing to “Economic Stress/General Pessimism” have increased noticeably to a very high 77%. The economic weakness thus appears to be increasingly taking its toll on sentiment in the market. Within this response category, agents include “recessionary conditions”, “cost of living increases” which include petrol price and tax hikes, and “policy uncertainty”, as factors.

For new mortgage lending, this can all have implications with a considerable lag.

While also having weakened of late, Gauteng appears to be the region where Residential Activity has held up best in the weakening national market. Of the 3 Major Coastal Metros, it has been Cape Town that has returned the lowest Activity Rating. This should not be too surprising, however, after recent years of far stronger house price growth than the rest of the country, Cape Town has run into home affordability challenges that have dampened demand and general activity.

Segmenting by Income Area, the Lower End outperforms, but the gap between it and the HNW has diminished.

In FNB’s Property Insights report, covering the FNB Estate Agent Survey’s 3rd Quarter 2018 Indicators of Price Realism and Market Balance,  in the 3rd quarter of 2018, we saw a slight quarterly increase in the estimated average number of “serious” viewers per show house before sale. From 10.42 viewers in the 2nd quarter, the estimate rose to 10.77. However, the average remains well below the 14.42 high reached in the final quarter of 2013, just before the early-2014 start of interest rate hiking.

In the 3rd quarter of 2018, we saw a further increase in the average time of homes on the market prior to sales. From 16 weeks and 4 days in the 2nd quarter 2018 Estate Agent Survey, the average time of homes on the market rose to 17 weeks and 6 days. We take the admittedly subjective view that around 12 weeks (near to 3 months) average time on the market more-or-less represents a market equilibrium situation on a national average basis. The market has thus broadly been drifting away from that equilibrium level since 2016.

No further rise has occurred in the high percentage of sellers required to drop their asking price to make the sale. The 3rd quarter 2018 survey showed a slight decline in this estimated percentage of sellers having to drop their asking price, from 96% in the previous quarter to 93%. Stock constraints remain low. We see very few agents pointing toward housing stock constraints in the market and slightly more pointing towards “ample stock”.

I order to corroborate the FNB and estate agents’ perceptions, just a short extract from Standard Bank’s Property Research of 25 October 2018:

“The SA property market was again softer Q3:2018 due to uninspiring real economy data and mixed signals from business and consumer sentiment indices. Also, financial conditions have remained tight, although relatively relaxed when compared to 2007 when last SA was in an economic recession. Consumers remain reticent about big financial obligations despite their relatively upbeat outlook on SA economy.

Regional house price trends show that the inland metros (Johannesburg, Tshwane and Ekurhuleni) still enjoy steady price growth but lost momentum in Q3.

In contrast, the coastal metros of Cape Town gradually decelerated in the past few quarters. Cape Town now is at the slowest pace since 2012. According to SBR’s regional HPI, it is also the first time since 2012 that JHB, SA’s biggest property market by volume, has outperformed CPT which is SA’s biggest market in value terms. We regard the current trends in CPT as a necessary cyclical downturn to realign prices with economic conditions at both regional and national levels.

The recent surge in prices (between 2014 and mid-2016) seems misaligned with the strength of economic fundaments at that time; now, prices are moderating. Waning sentiment due to the SA drought as well as policy uncertainty here and abroad, and a slowing influx of the affluent, restrained property prices in Cape Town. Properties in the higher end of our price segments are now deflating in the region and the volume of cash transactions is trending downwards.”

So we have the two banks pretty much in synch and the FNB Estate Agents’ research is really close to the coalface. To end, some points:

  1. On the lighter side, maybe I can get some sympathy for my early-year assertion that Gauteng would show real house price indices. At the time, I foresaw a good GDP growth and the fact that Gauteng house prices are really cheap in relative terms. At least now, Gauteng is the strongest performing market so I’m somewhat vindicated nearing year-end.
  2. Cape Town is adjusting significantly. No games here, it’s expensive and the only really good news is that we have alleviated Day Zero until the rainy season in 2019. Farmers and residents alike are delighted and the mood is far more positive on that front. It remains now for Patricia and the DA to sort themselves out so we can all get really happy so close to the next General Election.
  3. Don’t underestimate the fact that the SARB has not raised interest rates. Crippling would have been the effect on the back of Oil and VAT if they had. Thank you, SARB.
  4. The extended delay of house sales goes without saying but so interesting that the number of price reductions for a sale has reduced. FNB warns that we should not hang our hat on one measure, but despite the estate agents being “in stock”, buyers are willing to pay reasonably priced houses; that’s good news.
  5. On the other hand, sellers seem to be holding out for their price. Based on an average of 12 weeks on-market, that is increasing to over 16 weeks – a third longer. What that tells me is that genuine sellers are selling for good reason and that distressed sellers are fewer and further in between. In other words, distressed sellers would collapse their price to sell urgently but that’s not happening. I think part of the reason for that is that employment is holding its own except in distressed areas like the Platinum belt.

    Remember, things change quickly. Ramaphoria showed us all how quickly our perceptions become our reality and what an impact that has on our behaviour. The Rating Agencies are holding their horses, Tito is making very positive noises, the Nugent Commission is drawing to a close with an obvious outcome and the SARB has inflation on the side for the time being. Election 2019 will take place and I believe, is predictable. To not have that view is not an option to me.

    Things are positive and if there was any relaxation in the Emerging Markets drama, it would augur well for SA Inc. Look up, it might be sooner than you think. Whatever the case, HLJ continues to be in the market and there for you.

    Yours in Property.


Just for a change, I have posted an article that appeared in the latest Standpoint which is compiled by Stanlib (Volume 4:15 October, 2018) for their clients. The article is not solely about the residential property, but it gives us such a good overview of the property industry and serves well to make the point that economic growth is at the heart of everything we need in our country. Enjoy!

“Large-scale investment to develop and redevelop SA’s ageing property stock into modern premises for today’s high-tech businesses will only occur once economic growth is on a firm footing. Compared to many other countries in the continent, SA has a large and diversified pool of property, but a large portion of it is old and outdated, especially in the office and industrial sub-sectors.

Industrial property in general is not looking healthy, with the exception of warehousing. SA’s manufacturing sector is in the doldrums, because of slow economic growth and its dependence on Eskom’s costly and erratic power. Even specialised manufacturing nodes – such as a group of interdependent automotive businesses in close proximity – are seen as risky, since the collapse of one company can affect all its neighbours.

Taking a long-term view, SA manufacturing will recover, but investors incur opportunity costs by holding onto industrial property for five to six years until an upswing materialises. In the meantime, fundamental structural changes are taking place. Most of the activity in industrial property is due to shifting, not growth, as successful businesses move out of older properties that were not designed around information technology infrastructure. Older properties are becoming redundant.

Warehousing is sought-after, particularly for logistics businesses, but the demand is for more than simply a shed with a corrugated iron roof. Modern logistics requires laser-levelled floors and automated floor space. The most popular areas for logistics businesses are around Cape Town, Johannesburg and Durban airports. In Johannesburg, the prime area is along the R21 to OR Tambo, where both listed and unlisted family businesses have been active investors and developers, including companies like Fortress and Equites.

Retail property still offers specific opportunities. Of the four main retail categories – super-regional, regional, community and neighbourhood – the growth is in community retail centres. These include Nicolway, Morningside Mall and Benmore Gardens near Sandton, which provide quick shopping for people in surrounding residential areas. They can be convenience centres and sometimes even regional malls like Cresta, which is surrounded by high-density residential units and has little competition from smaller shopping centres, but super-regional and regional malls in general are battling, because they have a significant fashion component dependent on a strong economy and, because the global trend is towards shoppertainment.

Some of the newer malls like Cradlestone, Forest Hill and Mall of Africa have not yet seen sufficient residential development in their vicinity. Another trend evident in Mall of Africa’s design is the “work, live and play” trend, which means it can satisfy most of the lifestyle needs of residents in its catchment area, but some of the older malls have limited options for redesign and may have to be completely repurposed into hospitals or residential property in the next few decades.

Like industrial property, most of the action in the office sector is due to shifting rather than growth. Blue chip clients like Sasol, Discovery, Webber Wentzel and ENS have moved from older or scattered properties to centralised A- or P-grade offices in Sandton. These are usually “green” buildings with a focus on energy efficiency and recycling. In Gauteng, Sandton and Waterfall remain the most desirable office nodes while in Cape Town it is the Waterfront. In SA’s other urban centres there are no sufficiently sizeable office investment opportunities for institutional investors like STANLIB. We don’t see any revival in demand for the Johannesburg CBD, except for government and residential occupancy.

It will take sustained GDP growth to re-activate the whole office sector, from P- to C-grade. Businesses do not expand and hire new staff until they are certain of growth prospects. So we don’t see a recovery in this sector for several years. Much of the B- and C-grade space is becoming obsolescent and will have to be repurposed, although several of the SA-listed property stocks have a residential component. The only focused residential share is Indluplace Properties. In the residential sector, the main investment opportunity remains townhouse developments. There are some companies that specialise in sectors like student accommodation but they remain very small and student rentals are perceived to be risky.

Rapid urbanisation is not an investable opportunity because of the lack of jobs in SA’s cities. Although there is certainly a demand for low-cost housing, there is no income stream to incentivise large-scale private investment. SA GDP growth of at least 3-4% for a sustained period is needed to re-ignite property development. The earliest sectors to respond will be retail and warehousing and the latest will be office and industrial property. We continue to expect a total annual return (capital and income) from our property portfolios of about 13%, in line with the average of the last 10-15 years.”

Our kind acknowledgements to: Ahmed Motara (Listed Property Portfolio manager) and Lawrence Koikoi (Listed Property Portfolio manage)

I really enjoyed this article. It gives a drone-view of what’s going on and enables us to consider our actions going forward. It is factual rather than negative or sensational. We all know the truth that economic growth is at the heart of what we need. Bill Clinton was right in his campaign: “It’s the economy, stupid.” I remain circumspect, but grateful for the effort our President is putting in in this regard – strength to your arm, Mr President.

And secondly, I was seriously impressed with the following announcement by ABSA. Can you imagine what it would be like if a PPP could pull off anything close to this!?


“Dear Stakeholders,

Announcement: Absa’s position on Land Reform

We have noted the ANC’s announcement that it will propose an amendment to S25 of the Constitution in order to facilitate land reform and redistribution. We recognize the legacy of the past and the need to address the inequalities in our country. We are fully supportive of land policy and legislation that fulfils the intent of our Constitution and address the need for land among many South Africans.

We must also emphasize that this must be done in a manner that balances the needs of current and future private landowners, beneficiaries, government, the financial sector as well as its stakeholders.

We have noted the ANC’s undertaking that its proposal is for land expropriation to be done in a manner that doesn’t undermine the economy and that increasing agricultural production and food security will be a key priority.

Absa has made its own submission to Parliament after commissioning extensive research on the matter, including taking legal opinion on the efficacy of S25 of the Constitution. As a consequence, we do not believe that a constitutional amendment is necessary. Instead, Absa has identified five key areas through which the bank can make a meaningful contribution towards a sustainable land reform agenda.

These are:

1. The establishment of a special rural land reform fund, which would be funded by financial sector players and other organizations. The main objective of the fund would be to establish a new black commercial farming class.

2. The establishment of a special urban land reform fund. The fund would be geared towards building an affordable housing market that improves the affordability of urban housing and facilitate urban densification efforts as well as inner-city rehabilitation processes. It would also focus on creating a bigger class of black property developers.

3. The establishment of a land administration agency, a public-private partnership. Its priorities would include auditing the productivity and use of land which has been transferred through land reform and re-engineering the cumbersome processes through which land restitution claims are assessed and settled.

4. Support for the development of a new land administration system for the design and piloting of a new lands records system. This is especially important in former homeland areas where administration systems are not existent.

5. Driving a national dialogue for a new land policy white paper. There is a need for a new land policy White Paper that would culminate in an agreed national land policy.

We now await the outcome of the Constitutional Review Committee’s consultations and the rest of the parliamentary process before we can determine our next course of action.

Kind regards,
Geoff Lee
Managing Executive, Home Loans”


Never lose hope. Die hoop beskaam nooit. Translated – You’ll never be embarrassed by hoping for the best.

Yours in Property.


Sitting down to write this blog, I need to pinch myself at the state of the market. It really has proven resilient and prevails despite the much bad news. In its August Origination overview, ooba states that: “Application volumes for August 18 were 4.3% higher mom and 10.5% lower YoY.” That’s very good against the news, and just a fraction higher than the previous number of about 8.5%. So is the market slowing? Yes, but it is proving good against the backdrop.

In turn, ABSA: Household credit and mortgage advances: 28 September 2018 states that private mortgage advances have grown at 4.4%. The implication of that is that house prices have remained around that level, as we know, and little has happened to the volume of transactions. I know I’m broad-stroking this information, but to bore with the details is not the point of this blog. All I’m trying to say is that things are holding up well under the circumstances. If you agree, the question then is what’s going on?

We have an Emerging market meltdown with one of the most traded currencies in the world. From its best just after the President’s election of mid-R11’s to close to R15 today, the Rand has certainly had a run, but seems to have settled in the R14-15 range. Yesterday’s headline in the Sunday Times, “No, No. Nene” and news that has just arrived of his impending resignation is off-the-page bad, but we’ll probably know by the end of the day. Man, I can’t help feeling the wrong guy is being taken to the gallows especially after reading his letter of forgiveness. He’s got mine, for sure – what a man to have stood up and said “I was there”, but then he got fired for saying, “No nuclear!”. The wrong guy is falling and the ex-President is lounging at his fire pool. Flippit and the Poor suffer the rap of the markets and the currency. Unbelievable!

Unless I’ve missed it, the SOE’s seem to be on somewhat of an even keel. I’m really not sure how Eskom has staved off bankruptcy on a R20bn loan from the banks. It needs R60bn to be paid by errant municipalities, probably the same lot that are letting sewerage pour into the Vaal, but that money won’t be coming either, but somehow, it and SAA still seem to be flying. Understanding a little of SAExpress, they seem to be spluttering to lift off as well. Good on you, Pravin; we appreciate your 18-hour days. Politically, we now have some sort of inquiry into attempts to remove CR. Politics is dirty at the best of times and despite the “No, not me?!”, it seems our President may be flexing some muscle. We’ll see as Election 2019 approaches with speed.

There is so much more to state and speculate [which most of this really is, in all honesty], but the one thing I enjoy is that everything is in the open in a free Press. I’m sure that much takes place in cigar-filled lounges out of the public eye, but the view from the tip of the iceberg is still perspective-enhancing. Much better than having nothing, with State-owned channels and Press pumping out lies. Instead of meandering, let me draw to a close. What has all this got to do with the property market?

The market is holding up against an avalanche of counter-market news. Resilient to the core, good men and women are buying and selling houses and I note that Africans, some 64% of transactions in the ooba data, are spending on property. There is a barrage of bad news, but in many parts of our country, it is business as usual. Is it the edge of a precipice or the foundation for gradual success? I like to think the latter. Someone who lives in our town was quoted as saying, “I’m not an eternal optimist, but I am addicted to hope.” Maybe, I’m just like the Archbishop Desmond Tutu, an old optimist despite the evidence. Where are you in the continuum from despair to hope? One thing is for sure, wherever you are placed, so are those around you; those dear souls “feel” your energy every day – positive or negative – you rub off on them.

Yours in Property.


“Sorry, seems to be the hardest word.” That’s how the song goes. But in my last blog, I said sorry for over-estimating the rise in Joburg prices this year and the GDP growth of the country :-(!

Let’s have a look at the property market in this blog.

I still think that we’re being let off the hook and things are going fairly well given the dire economic news we read every day. My opinion tries not to be scientific so a lot of gut-feel goes into that statement. In addition, I live in a small, upmarket town which has had some raw land-delivery protests in the recent past and this, together with talking to contacts who are steeped in national property businesses, I’m sure colours my view. As you read, you may have a different perspective so let me know if you differ significantly.

Some insights:

  1. FNB’s John Loos, in on 4 September 2018, informs us that “the majority of home sellers (96%) have to drop their asking price in order to sell the property” in the Q2: 2018, according to the latest FNB Estate Agent Survey. “This is up from an estimated 91% reflected in the first quarter survey and compared to an estimated 78% who ended up having to lower their asking prices in 2014. He says the survey evidence suggests that asking prices on average have become less realistic in recent years. The estimated magnitude of asking price drop needed to make a sale became slightly larger – from -8.2% in the first quarter of 2018 to 9.2% in the second quarter”. And finally to this point, “FNB has not seen any noticeable increase in the percentage of properties resold at prices lower than the previous purchase price. About 9.6% of total properties resold in July were estimated to be at lower prices than the previous purchase price. This is higher than the 8.7% of May and 8.9% of June.”

    The word “realistic” is loaded with sentiment, the seller’s state of mind. If my home must be sold at less than the purchase price, about 10% per the comment above, that’s stressful. Making a capital gain of less than inflation is going backward fast especially given all the costs of selling and re-buying or renting. Making no gain could best be described as a stress-sale. On the other hand, in some parts of the country, 10-15% gain almost per annum, has been the order of the day. No more and my friend in Cape Town says that “to drop a Million on your price” is the nature of house sales at the moment. So, would any seller drop the million before selling? I don’t think so. You’d do that when you are a serious seller and see that no one is coming through your door. Getting the price right depends on the seller’s desire to sell. We have a house nearby going for R12.3m which has been on the market for about 6 months. It’s not going to sell even on a lucky dip and the price indicates seller reluctance.

  2. On the other hand, in a place like Hermanus what would be the price of this seller’s house? My guess is about R10m. Why a guess? Well, the market has definitely received more stock given the recent unrest which, as we’ve discussed before, is very in-your-face in a smaller town, so the outworking of these sentiments remains to be seen. The jury of potential buyers is out. Linked to this and for interest sake, the EFF held it’s Provincial Conference in Hermanus last weekend over three days. In the Zwelishle Primary school hall, the conference was orderly and had very little impact on the town. On Sunday, Julius held a rally at the sports fields and that went off peacefully as well. We’re grateful and trust such behaviour continues to pervade the run-up to the elections.
  3. Another aspect of the higher asking prices is that sales are taking longer to conclude – about 50% longer depending on where you read. 40 days on the market has moved out to 60 days overall. Again, I bet you the unrealistic expectations of sellers have contributed to this situation. What would be really interesting to see is the number of houses listed and then withdrawn from the market. That trend would tell you how needy the sellers were to sell for whatever reason. On the face of it, “I can’t afford my house anymore” should be rising as the economy remains very sluggish and jobs become more insecure, thus reducing confidence.
  4. Sadly, allied to the “I need to sell” category is higher levels of emigration. One can read very valuable information from the FNB Barometers covering this aspect, but perhaps the most interesting for me is that Police Clearances have moved out from about 6 weeks to 12, and even 15, weeks.
  5. One aspect that drives much of this conversation is the rate of interest and the desire of the banks to lend. The former stayed level last week as SARB, I am sure, attempted to supplement President Ramaphosa’s stabilization package and his envisaged stimulus mega-fund. On the other hand, the banks seem to still be saying Yes to lending and are thus a welcome part of the answer to growth; long may that be! On the absolutely negative side is an apparent helluva increase of petrol coming soon. What a tragedy that the tax on fuel and the VAT increase [which by estimates then, take R29bn out of consumers’ pockets], is simply the penalty of corruption under the leadership of the ex-president and his cronies. Imagine the same increases being ploughed into the Investment Mega-fund for housing, schools, and tourism! What a country we could have!

In summary, we are better than we could have been, in my humble opinion. I often say that as I write and then qualify myself by saying that I genuinely believe that. I have lived through terrible recessions, and this for all of its insidious undercurrent of large-scale theft, is not “terrible” in its outworking. Granted, these are not the “ol’ days” pre – 2008, but they could have been much, much worse for the property industry. My encouragement, therefore, is that we vasbyt. Reiterating my previous blog, our President can pronounce R400bn and maybe we don’t know where it’s coming from but from what I hear from his United Nations conversations, he has acquitted himself well. Remember, it was not long ago that Pravin Gordhan was called back from speaking to investors with R5tn in investment funds on the pretext of a one-pager spy accusation which resulted in Gigagupta being appointed in his stead – WE’VE COME A LONG WAY IN 2018!!!]

I learned an Afrikaans idiom the other day, “Die hoop beskaam nooit.” For the uninitiated, “Hope does not disappoint” [Romans 5:5], or, “Hope does not embarrass you.” On the contrary, hope rubs off on those around you. Enthusiasm is hope internalized and expressed. Remember, if you’re happy, tell your face. We are all more beautiful when we smile and “smile lines” are never wrinkles 🙂

Yours in Property.


Earlier in the year I stuck my neck out and said that Joburg would show an 8% notional increase in house prices and implied it would be hot property news. Not so, I’m afraid. Sorry. Then, I stuck my neck out [with the IMF as I’ve said in a previous email], and said we’d grow at 1.7%. I was only out by 1, but that’s the 1 in the front. Drat! Another Sorry is due. So before you stop reading and call me a Wuzz, give me a break.

You see, we’re not in technical recession, the first time I heard President Ramaphosa (CR) say that I thought he was taking advantage of the latest weed laws, but then, Roelof Botha, ex-RMB, who I have always considered at the top economist in the country, was reported having the same stance. So maybe, CR has been sticking to Johnny Blue on his Fresnaye property’s stoep. So without boring you with the details, the numbers are skewed by Agriculture in the main, and what remains is some other drought-stricken technicality. All of that said, we should pop out of technical recession fairly soon and recover a tiny growth this year.

Now let’s see why Growth with a capital “G” is on the cards. 

Firstly, the SARB held rates recently and that is good news for our ailing economy. Remember, they walk a tightrope, because the Bond investors love a big differential between the Bond yield and their own country’s interest yields, adjusted for inflation and the Rand volatility. In simple terms, if you don’t raise the rates and the risk of doing business increases for whatever reason, then money flows out of the country. Big risk, but well taken given the current slowdown in our economy. In fact, a complementary decision to my next point.

So, secondly, our President has announced amazing benefits to our economy today. I am so excited even though we know we need far more. On the lighter side, #paybackthemoney would provide more than enough to stimulate our economy; just seeing someone go to jail would really lift our spirits. So again, I have no desire to go through all the details and, if truth be told, I have no idea where we find the money, but a stimulus of R50bn to “stabilize Education and Health Care” is seriously welcome and R400bn to really stimulate the economy is a mind-blow. So much stimulation in one day could be bad for one’s heart; but, thank you, President Cyril and your 10-person Advisory Board, you’re going to announce in the next few days.

We’ll cover a tiny bit of the details, the rest being your homework, but seriously, I cannot tell you how amazing it is to see a President, obviously trained by Pravin Gordhan to read teleprompters, reading a huge economic breakthrough and flawlessly enunciating Four Hundred Billion Rand, that’s R400000000000. So glad the author of 400…Rand…million, billion, ten…he, he, is no more.

We need stimulation. Money flows of private citizens offshore feel to me to be at record highs. People are leaving all around me – kids who comprise our future being snapped up for their artisan, IT and teaching skills. Out there are countries building countries on the back of our young, competent families and I feel like putting my finger down my throat when I think of the loss just when we need the skills the most to rebuild this beautiful, tortured nation, but at least we have a President who sees the issue and has the gravitas and presence to rectify the problem, albeit, over a very long period.

Healthcare needs stabilization. The Minister of Health should have declared a crisis a long time ago, but at least, finally has some money to spend. Heaven knows we need it well spent on priorities that benefit our people. Please don’t steal our hard-earned cash and don’t turn a blind eye to those who would! For education, desks and toilets would be really helpful. Make the former out of recycled plastic and achieve a double whammy. Then, for the latter, build toilets with septic tanks where you can’t easily access a sewerage pipe. For goodness sake, [I heard a guy on CapeTalk saying the sewerage pipe was 4 kms away so they could not give a school a flushing toilet.] Really??!! I used a septic tank in Amanzimtoti for years, because we had no water-borne sewerage and what about every farmer in the country?? Imagine a civil works programme that dug and kitted-out septic tanks at schools using recycled water and then teams of guys keeping them in working order? Now there’s a project worth doing.

So, in the R400bn, is a mega-fund for Infrastructure. Just to put that in perspective, a year or two ago, it was pointed out on 702 that the market capitalization of Mr Price was more than the entire Construction industry. So a company which imports clothes from China and sells them to us is worth more than Basil Read, Grinaker/LTA {Aveng], Group5, Murray and Roberts, and WBHO [the only one making money at the moment] combined. In fact, the shares of Aveng, two massive companies that we grew up with, are currently 4 cents, I am advised. How do we get to this position where the industry would probably battle to revive such is the job-bleed? Well, firstly, you steal from the SOE’s and then you take all the taxpayers’ money and spend it on salaries in government and what do you get? People affording millions of t-shirts, but no repairs of sewerage works and no building and maintenance of roads. It’s called selling your childrens’ future and is great for failed-state ignominy.

So am I depressed? No, very upbeat that we have a President who can recognise the problem and before he jets off to the United Nations and presentations to global business leaders, can announce our best shot at economic revival. His intellect, business acumen and sense of resoluteness is just a breath of fresh air. I’ve said many times before, my faith lies way above him, but if you offered me these packages announced this week and the Zondo Commission in November last year, I would have been amazed at your largesse.

Where does that leave us? As Homeloan Junction we work tirelessly to provide a consistency of service and interface with the banks that surpass expectations. We don’t always succeed we’re sure, but we press on. The wonderful thing about business is that one hand washes the other in a virtuous cycle. As I serve you, you serve me and we serve our customers. Together we do more and everyone wins. From a political perspective, we try our best to encourage each other to lose the “noise” and focus on the good in the system. The initiatives above are good by anybody’s standards and we hope they are implemented and bear fruit – jobs, upgrades, service deliveries and municipalities that work again – for all of our People. We will press on and we and we invite you to join us. We’re not Pollyanna’s, we understand the crime and grime, but we are determined to put in a solid day’s work for a well-earned reward, productive in the knowledge that we know what we are doing and we do it well.

Success to you, our readers, as you take the good, park the bad, and move on to success. We appreciate your support.

Yours in Property.


I am on a plane to Mauritius. How privileged am I to be included in a group of Homeloan Junction and Ooba Winners who have shot the lights out in 2017! I did nothing, they did everything to be here.  We have first-timers, people who have never flown internationally before. We have golden oldies, those who have won over and over again and now, have won again. Each has their own story so let’s explore that.

In my management career, I have met winners at the airport.  The most excited are those who have never flown before.  They are nervous to the point of fidgety; will I be safe,  will I return to the one who kissed me tenderly at the airport? Of course, you will say the initiated – just enjoy the flight. Light-hearted, but also caring. And then there are those who are used to winning; the die-hards who have done the hard yards, amazing people who have been consistently successful over years, even decades.  Amazing that!  To do it in one year is good. To do it over and over again takes a different story completely.

So, over the next two blogs, here are their un-named stories and a summary of their critical success factors…

“Success is what you believe in”. Perhaps this is a crux of the matter as I look back on the people I met in Mauritius. They are confident and assertive – there is an air of success about them. They know what they know and find themselves often in the company of winners. You can see it in the way they interact and hear it in their language as they speak to others and together. There is a balance of affinity, distance and a professionalism that is pervasive. They know how to have fun as well; they laugh easily and play appropriately, but they overdo nothing and enjoy the moment. You can just feel, these people believe in success.

“Perseverance and long hours”, says another. Some of this team know what it takes to work 18 hours a day. From early in the morning to late at night, administration with constant calls in between, they set to the task of satisfying customers. You know what it’s like – the young couple have bought their house and they’re starry-eyed as they await bond approval. The estate agent has done the sale and is counting the commission. The developer needs 70% successful sales/bond approvals for the development loan. You have your own office costs and need to build relationships. Little wonder that perseverance and long hours are needed, not just in the short-term but as a daily habit. We all know that over time, this hectic pace dissipates as a general rule, but every now and again, the need for huge effort raises its head. These winners have ceased wondering when it will stop; instead, they lift their game when required, every time.

“Niks, I just go with the flow.” I know this lady well and she is not a Niks kind of person. What has happened here is that decades of service have done two things – cemented relationships, and generated repeat business as a significant part of her income. She did the hard work years ago and has skilled herself through thick and thin to deal deals with the estate agents and the banks. She knows her oats and doesn’t submit what will not be approved; she’s efficient, values her time and that of others. On the other hand, if anyone in that process disagrees, they could cop the lip that comes with 20 years of experience. For the uninitiated, the matter of apprenticeship comes to the fore. You don’t study to do homeloans and your BCom degree means little if it has not taught you some property law, finance, credit, banking, administration management and then overlaid that with huge dollops of inter-personal skills. You don’t get to quip “Niks”, if you haven’t done the “Baie”.

Relationships are built over years. It is often said that a relationship takes years to build and seconds to destroy. I would add that where money is involved, that formula speeds up. Making my money through consistency and quality of work is good for relationships; a kind of “spice on the top” of commercial associations. But one lie, one un-met promise, or, one poorly managed expectation, can turn your relationship into a nightmare. By the way, but for the first malady which can often be terminal, the others can be dealt quite efficiently by what I call “emotional reserves”. These reserves are built over time and can be likened to a petrol tank’s gauge. Trust, care, friendship, efficiency, feedback are all ways to build emotional reserves that fill the tank of a relationship.

A mistake may use up some of the supply, but can be accommodated from the relationship’s reserve. This may sound a little “soft” but all relationships, personal and business, where emotional reserves have been built up can then be used, by saying sorry or committing [and keeping the commitment] to do better next time. Winners manage expectations and then even in the face of bad news, have a positive approach to an outcome. How often have I myself, told a customer they are flying high in terms of their credit request and then managed them through the decline of the bank to a more realistic application. By the way, another thing here is the question of credit terms. A customer’s lack of knowledge of banking can lead to the question, “Will you get me the best rate?” My answer, “No, but I will get you the best credit terms.” What is the good of Prime – 0.5% with a deposit of R100000 if the deposit does not exist or, was destined to be used for TLC of the property? Prime + 1% may be far more acceptable with no deposit under these circumstances. Don’t get caught up-front in pricing as the bottom line of your service; you’re better than that.

“Origination is entrepreneurial and gives you an opportunity.” I guess this goes for any self-employment though it never feels like that when you’re building your business. But as the years go by and your competency and relationships strengthen, origination is a really nice business to be in. It gets you out, gets you in, and gets you going. Office jobs are crucial to service delivery, but marketing gets you face-to-face with the customer and interface with the stakeholders; it gets you out. It gets you in, into suppliers, interesting projects, opportunities for value-adds and serious negotiations. These are the places where long-term, solid relationships can be built and sustained. And, origination gets you going; every day and continuously. Perhaps one of the cutest comments in my interviews with the winners was simply this, “I won’t change my job!” Not for anything; that entrepreneurship and opportunity talking and from behind a broad smile.

On the other hand, it takes a “wild ride” to leave a stable job and come into this crazy world of property and bonds. None of the winners found it easy but they figured that origination, with its value-adding benefit to the customer absolutely free-of-charge, was the way to go. “I wondered how I would survive” was almost common to all the newbies in Mauritius. It takes a strong cocktail of self-belief and courage to walk away from the known into the unknown. Just like any business venture, you will have days of doubt and days of elation, but what our winners know by their success is that “origination is for me.” Just a point on the taking and managing of risk. Consider the risk carefully, consult wise counsel, be fairly sure of your ability to succeed and why. Wait to build the skills and/or contacts if you do not feel ready, but once you jump, then begin to manage the risk.

Start within with positive self-talk and surround yourself with winning combinations of people and processes so that you give yourself an undisputed chance of success. Like the old saying goes, “you can’t fly like an eagle with turkeys like these.” If that’s arrogance talking, get off your high horse, nobody likes a smart-ass, but if you do not have the right people on the bus, get the right people – you can go out and compete in the marketplace every day but you better have a strong, competent team behind you. You cannot fight a frontal and a rear-guard action at the same time. Think about this, it’s absolutely true. Indeed, a critical success factor.

More to follow in our final part to Mauritius 2018…

Yours in Property.

QUO VADIS? (Where are you going?)

The extract from FNB’s Property Barometer for July 2018 below leaves me posing the subject’s question.

We started out so positively with Ramaphoria taking hold of us, our stock markets, Rating Agencies and the property market. The other day, I read an article in which this term was called Ramaphobia by mistake; it could have been a Freudian slip.

Here is the extract:

“While periodic fluctuations in economic growth could see transaction volumes growth turn positive from time to time, the consistently negative real house price growth since early-2016 leads us to believe that economic growth rates of 1%-1.5%, along with very little interest rate stimulus, are not sufficient to create the level of housing demand that can mop up oversupplies, balance the market and lead to positive real house price growth.

With 7 months’ worth of house price data available for 2018, it appears increasingly likely that average house price growth for the entire 2018 will come in slower than 2017’s 4.3%, and we now forecast an average price growth of 3.5% for this year. This is based on a GDP forecast of 1.3% for 2018, which is unchanged from 2017. The Firstrand Economics team sees slightly faster economic growth in 2019, to the tune of 1.6%, translating into a slightly faster average house price forecast of 3.7%.

Given what we have said about economic growth is insufficient to balance the housing market better, the theme through our forecast period is one of low single-digit house price growth, underperforming CPI inflation, which will translate into further real house price decline”

I cannot argue the FNB view based on current evidence and they may prove right in their forecasts. I did not have any other banks’ reports at the time of writing, but I doubt they will contradict the thoughts above.

So where did things change and what is positive at all in our current predicament? Firstly, the World Bank’s forecast of 1.7-1.9% growth in GDP was no doubt based on positive views of SA Inc. It was mirrored, though slightly muted, by the banks. Then we had real positive noises around corruption and repatriation of stolen funds. This has proved difficult. Then we had confidence that CR would be able to quickly consolidate his position and make real changes to the ANC whilst retaining unity, but this is obviously not possible and compromise rather than decisiveness has hallmarked CR’s Presidency thus far.

Are you miserable and beginning a self-prophetic downward spiral or do you remain positive against the odds? I am not Pollyannaish and I understand both views. However, just before you decide on the former, here are some initiatives that we thought we would not, or never thought we would see:

  1. The July inflation was 5.1%. That makes the HPI real growth negative; about  -1% to be more specific. But, two points on that – the price of petrol caused the inflation increase, practically, nothing else. Secondly, the SARB will not raise interest rates in such an environment and, more particularly, in the face of an election. So I believe, interest rates will not rise despite the Rand decline.
  2. The Zondo commission has kicked off to investigate State Capture. Thulii Madonsela cobbled State of Capture report together just before she left office; thank goodness! Now the commission is in place to investigate and report on the phenomenon. Be warned, the commission will only then recommend NPA intervention to investigate and prosecute offenders. We thought 6 months would be enough – trial-by-Zumaleaks, but that was never going to happen. Remember, we function under the rule of law and a Constitution. Be grateful this is not the Wild West. Should we toss that out, then anything goes. If you gave me the Zondo Commission taking two years to conclude in November 2017, I would have taken it gratefully.
  3. I saw some of my ex-Nedbank executives on Carte Blanche talking about how they were dismissed en masse at SARS. The Nugent Commission has now heard so much corroborative evidence that Tom Moyane and his management ravaged a world-class tax collection agency by reconfiguring the organization, that the Evidence-leader called for dissenting evidence – there has been none! I saw in the paper today, that Bain Consulting, who we from Nedbank know well and who were paid R200m for their opinion, consulted on the restructure. It remains to be seen whether they and KPMG gave SARS top brass the ammunition to reduce the organization to a corruption-friendly entity. We will see. Again, if you’d given me the Nugent Commission late last year, I would have jumped at it.
  4. The Investment team that CR put in place must have terrible headwinds presently, but they are brilliant individuals. Strength to their arms!
  5. SARB has challenged the new Public Protector’s report on their existence and won. In the face of the EFF’s tabling of a SARB nationalization Proposal to Parliament, they still remain completely independent. I must believe that will not change.
  6. The Minister of Energy and Minerals, Gwede Mantashe, has withdrawn the Amendment Bill to the Mining and Minerals Act. Great news and somewhat reassuring for mining investors. Remember, Zwane from Bloemfontein was a Gupterite and introduced the Bill amendment. One of the key provisions was that the Minister could direct to whom product could be sold and what beneficiation should be pursued. Who do you think would have benefited??
  7. Government is beginning to deal with Social Equity. I think their methods suck and telling me the Constitution’s clause 25 will be changed while we wait for the analysis of the 149000 submissions submitted to the provincial hearings on this matter, does nothing for my confidence, but we need to deal with this; let me say this again, we need to deal with social equity. In the meantime, Adam Catzavelos covers us in shame – what he said and posted was a disgrace. How is that we manage to take one step forward and then shoot ourselves in both feet?
  8. The CEO’s are better managed now than for the last 8 years. Can we save them all? I have no idea, but I would back Pravin to do his best.

You see, not everything is negative. Like you I’m worried and I would be lying to not admit it, but we have a number of positive things happening and we need to hang onto these. You see, whether you are positive or negative, “it” will happen, but I can guarantee you, what you do with the outcome will depend on your going-in attitude.

Yours in Property.