Real Estate Investor Magazine
July 2023 edition: full text
Every page of the July 2023 issue as text. To see a page as it was designed, open it in the magazine.
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JULY/AUGUST 2023
INVESTING OFFSHORE
How Shared Accommodation is a housing solution
RESIDENTIAL & INVESTMENT CONFERENCE
Uniting & Empowering our residential property future
GUIDE TO EVICTION LAWS IN SA
Understanding tenant’s rights & Landlord responsibilities
ACCELERATE YOUR PROPERTY BUSINESS
7 Time Saving tips to propel you to the next level
WOMEN IN PROPERTY Celebrating success in Women’s Month
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Uniting South Africa’s residential value chain:
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The Residential Investment & Development Conference & celebrating women leadership
he Residential Investment and Development Conference & Awards held recently in Johannesburg has created waves in the South African residential sector for knowledge sharing, collaboration, and business opportunities. The inaugural event hosted by SmartXchange with REI as official event partners is currently SA’s only annual forum focused on multi-sector residential
investment and development.
Key focus areas of the conference were on social, affordable, student accommodation, multi-family, co-living, and the retirement sectors in South Africa. Topics centred around enabling and incentivizing private players to achieve hosing for all, slashing development costs, capacitating the state for faster project approvals, innovative financing structures for affordable housing, how to monetise and get maximum returns from affordable, student, multi-family, and retirement sectors, semigration and residential trends, pricing, and positioning properties correctly and getting affordable retirement stock to market.
We know that SA has a massive housing shortage and has one of the highest urbanisation rates (63%) amongst emerging economies across the world – in fact higher than that of Nigeria and China (countries with much larger populations). There are 3309 informal settlements in the country. Social and Affordable Housing must be galvanised to produce massive amounts of housing to alleviate the shortages. The conference unpacked the importance, availability, and role of First Home Finance and how banks can accelerate affordable housing.
In the Student Accommodation sector there is a capacity gap of more than 500 000 beds. In the last two years (2020, 2021) NSFAS spent an average R11,9 billion per annum on student accommodation funding and at this conference, Minister Tebogo Letsie announced a funding increase to over R19 billion for 2023. At least 420,000 students each year are in university and TVET accommodation. Out of this, approximately 43% was for institutional residences and 57% was for private accommodation. The opportunities for new developers to enter this space is immense, given that there is a specific service offering that is provided.
The use of technology is another key focus for Innovative Building Technologies (IBTs) which can reduce the cost of building materials by more than 10%. The unpacking of technologies in improving efficiencies and looking at best practices in this space is well known and needs to be unpacked more, in future discussions.
honour and acknowledge the remarkable women who are driving change and innovation in the property business. In this issue, we feature some of the industry's movers and shakers, showcasing the fundamental roles and contributions that women are making in shaping the property industry's changing landscape.
We hope you find this issue enlightening and inspiring, as we continue to empower property investors and industry professionals. Let's join hands in creating a better and more inclusive residential sector for the future of South Africa.
Successful investing.
NEALE PETERSEN FOUNDER & EDITOR-IN-CHIEF
Additionally, we recognize that Retirement property, on the other hand, remains a relatively untapped area of the South African housing market. The result is high prices suitable only for a few (less than 6% of South Africans can afford comfortable retirement), and long waiting lists at nearly every facility – be it at a retirement estate, village, or old age facility. This area presents exciting prospects for further exploration and development.
August is woman’s month, and, in this issue, we celebrate women in the property business, and we meet some of the movers and shakers in the property space. We acknowledge the fundamental roles and contribution that women play in the changing landscape of the property industry.
As we celebrate Women's Month in August, we also take this opportunity to
Mind Blowing Property Market Insights in Cape Town Uncovering Surprising Truths
REI TEAM
EDITORIAL
Founder & Editor-at-Large
Neale Petersen neale@rei.co.za
Website Specialist
Graham Miller graham@rei.co.za
Digital Strategist
Alexander De Villiers alexander@rei.co.za
Digital Strategist
Asheeq Cader asheeq@rei.co.za
rei.co.za
JULY/AUGUST 2023
INVESTING OFFSHORE
How Shared Accommodation is a housing solution
RESIDENTIAL & INVESTMENT CONFERENCE
Uniting & Empowering our residential property future
GUIDE TO EVICTION LAWS IN SA
Understanding tenant’s rights & Landlord responsibilities
ACCELERATE YOUR PROPERTY BUSINESS
7 Time Saving tips to propel you to the next level
WOMEN IN PROPERTY Celebrating success in Women’s Month
FRONT COVER IMAGE: Jaco Grobbelaar Managing Director at Prosperity Enterprises
CONTRIBUTORS
Simon Dippenaar Jackie Smith Rael Levitt Mantsi Moiloa Annemarie Wilmore Kathryn Bertram Dean Parata Jaco Grobbelaar Janine Barry Alan van der Westhuizen David Jacobs
Digital Designer
Heather Spangenberg design@rei.co.za
Accounts Manager
Marisa George marisa@rei.co.za
CIRCULATION
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All rights reserved. No portion of this publication may be reproduced or used in any form without prior written consent and permission from Reale Media. The publisher gives no written guarantees or assurances and makes no representation regarding any goods or services written or advertised within this edition. Prospective investors should always consult their attorneys, advisors or accountants before investing. Copyright © Reale Activation. Pty (Ltd)
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CONTENTS
MAY/JUNE 2023 #157
TRENDING
003 Editorial View 013 Cover Story 025 Reside Awards 135 Navigating South Africa's Distressed Property Market: Real Estate Assist's Solution for Homeowners and Buyers
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INVESTING
033 Expand your property investment toolbox: Harness the power of Access Bonds for optimal investment growth 039 Unleash the potential: Explore the advantages of investing in vacant land for development 043 Impact Investing: Driving positive change in real estate 047 Understanding Tenants' Rights and Landlords' Responsibilities: A Guide to Eviction Laws in South Africa
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FINANCE
061 Safeguarding your Business: Essential strategies to prevent involvement in Money Laundering Schemes
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WEALTH
073 Accelerate your Real Estate business: 7 Time saving tips to propel you to the next level
TECHNOLOGY
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COMMERCIAL
091 Semigration: the rebirth of the suburbs and towns in South Africa 101 Adapting to the E-commerce era: How industrial real estate can thrive and stay competitive 107 Gender safety first: A Commercial property investment grade hinges on women’s security 113 Breaking ground in grand style: TUHF & Concor Construction unleash mega mixed-use development at Conradie Park
OFFSHORE
121 Unlocking refunds: South Africans investing in Australian real estate may reclaim duty and land tax paid due to inoperative taxes 129 Rising above the UK housing shortage: How shared accommodation emerges as a solution
081 Guarding against Cybercrime: South Africa earns unfortunate title as Africa’s Cybercrime capital
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REI MAgazine
rei.co.za
JUNE/JULY 2023
RESIDENTIAL RETURNS
INTEREST RATE HIKE
An essential 3-Step Guide to navigate risk
FUTURE PROOF YOUR WEALTH
MASTERING TECHNOLOGY
RAEL LEVITT
The journey of a tenacious climb, humbling fall, & triumphant return of Inospace’s founder
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JULY/AUG 2023 SA Real Estate Investor Magazine
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ASK THE EXPERTS
Send your questions to info@rei.co.za or post on our FaceBook or LinkedIn pages and we will direct them to the necessary expert
Unlocking Investment success: Navigating capital appreciation & cash flow
JANINE BARRY Master Property Practitioner
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hat are the key factors you consider when identifying properties with strong potential for capital appreciation versus consistent and higher-than-average cash flow to make an informed investment decision?
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here is a saying, "You can't have your cake and eat it" Well, in real estate, you can. Knowing your "why buy" and what it is you're after is pivotal in achieving the type of returns you desire. Whether it is ultimately for capital gains, current and future income, or both, purchasing in line with your "why buy" will prevent you from making one of the worst decisions of your life or assist you in making one of your best and most definitely will guide you in determining where and what to buy.
Use the numbers to guide you. Calculating the rental yield (annual
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rental income divided by the property's value) helps determine the potential cash flow. Higher rental yields suggest better cash flow potential, while lower yields may indicate the property is geared more toward capital appreciation.
Location creates demand, and demand creates value. Choosing the right location is crucial for capital appreciation and more substantial cash flow. Properties in areas experiencing growth and development and in sought-after neighbourhoods will appreciate both in value and rental income faster and grow at a higher percentage than average.
Time is money. Consider whether it is a property you could engineer higher returns by immediately enhancing value quickly and easily, with a renovation to attract strong capital appreciation. Adding value
Q&A
such as solar, inverters, security, fibre, and Wi-Fi or changing three bedrooms into four will attract higher and more consistent income right from the beginning. The effect of compounding on an already higher value and income-engineered property will ramp up your returns exponentially from the beginning of your investment.
Follow the money. If you are looking for steady income, look where there is a "built-in" demand for rentals, such as student accommodation, a large workforce, or if for Airbnb, a blue flag beach, or an area close to huge events and conferences. Low or zero vacancies generate robust cash flow and create higher resale value for the property.
An updated, well-maintained property bodes well for capital appreciation and higher rental income. Well-maintained and updated properties outperform the competition even in a down market, rent faster, enjoy lower vacancies, and prove much higher income yields than dated or under-maintained properties.
Go for gold. Invest in a trophy property. The capital appreciation and returns are enormous. These are the best properties with the highest prices in the top 2% of the real estate spectrum. These are iconic, historic, desirable locations, spectacular sea views, and high-yielding properties with unique and high-value attributes.
Understanding the current real estate market is essential to making the best investment decision. Analysing supply and demand, local market conditions, economic factors, and trends can provide insights into whether a property will likely appreciate and generate consistent and higher cash flow.
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COVER STORY
Shattering the glass Celebrating women waves in Real Estate and Business
By Neale Petersen
Every year in August, SA marks Women’s Month where we pay tribute to women who first marched to the Union Buildings on 9 August 1956 in protest against extension of Pass laws to women. To celebrate this we uncover the successes of women in SA that are making a difference and enabling change in the world of property and business today.
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WOMEN IN REAL ESTATE
ceiling: making
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lready on the investing front we are seeing more women focused on gaining financial independence, delaying marriage to establish their careers and more than 43% are already successful home loan applicants and more than 50% are home owners that are leading the way in buying property in SA.
Just a few of the issues affecting women in South Africa include challenges such as gender equality, feminisation of poverty, violence against women and discrimination on the basis of gender as SA still remains a strong patriarchal society. Let’s meet just a few of the women who are shining beacons, leading and making a difference in the real estate field in SA.
Margaret Hirsch – Executive Director, Hirsch’s Homestores
Margaret Hirsch has become an inspiring example to businesswomen across Africa, starting from humble beginnings to eventually co-founding and managing Hirsch's with her husband Allan. Today, Hirsch's is the largest independently owned appliance and electronics retail operation in South Africa.
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Margaret has an incredible passion for helping people and especially a champion of women’s empowerment and helps them realise their potential and achieve their passion in life. Her mantra is ‘Your purpose in life is to find your gift and your mission in life is to give it away.’
While Margaret is the co-founder and Executive Director of successful retail business Hirsch’s she has also been extremely successful in investing in property. In fact her success in property investing has her singing from the rafters saying that ‘ ‘property is probably the single best investment you will ever make.’ Quite a statement for a successful homestore retailer.
Before she even started work, Margaret first dabbled in the stock market when she was working for a boss. He was an ‘expert’ on the stock market, so she just followed his lead, and regretfully lost all of her money and even some more money that she borrowed to invest in stocks and shares.
This was a huge learning curve for her, and from that day forward she decided that she would only ever invest in property. Property is
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something she could see, feel, and touch, and that is exactly what she did. From a meagre start where she saved R100 a month from her salary until she could afford to pay cash for a small house she eyed in Durban North, which she bought way back then for R2000 cash at the time! She subsequently sold the house for R7,500 and then went on to buy another house in Durban North for about R10,000. This house she also eventually sold and then bought a piece of land in the same area in 1974 and built a house which cost her R24,000.
business and loaned them enough money to cover their shortfall on the mortgage and expenses.
Slowly, but surely she built up her property portfolio literally one step at a time. Margaret says, ‘There is no get rich quick solution here!’ In 1979 she started Hirsch’s and all the money she had made went directly into that business. Shortly after she started, she realised that paying rent for the business was not an option so she went to an auction when a property at 27 Umhlanga Rocks Drive in Durban, KZN was up for auction. She bought their first commercial property for the princely sum of R115,000. She is eternally grateful to Alec Yuill (who was Bank Manager of Standard Bank, Durban North at that time) who believed in Margaret and her
As Margaret says, common sense must tell you that there is only so much land available on this planet. There is never going to be any
This created the ideal platform for buying more properties. Over the years Margaret has bought and sold so many properties and each step was one step closer towards the Billion Rand property portfolio she was aiming for and has acquired today. Today Hirsh’s and Margaret own all their own properties where they operate from, both in her personal and business capacity.
'Your purpose in life is to find your gift and your mission in life is to give it away.’ - MARGARET HIRSCH
COVER STORY
more so of course you will always make money out of property as the value continues to go up and so will the demand.
Her advice to all her staff is to not only own and pay off their first home, but to work towards a second property, as this is the safest way to ensure that you can get to a long and happy retiremen. Rentals will not only always keep up with inflation but will also exceed inflation. Like every journey, the journey to riches through property, starts with the first step. Margaret suggests that you take that first step today.
Palesa Ryan – Head: SHE – Development Bank of SA (DBSA)
Palesa Ryan is the Head of Origination and Coverage for the Social, Health and Education sectors at the Development Bank of Southern Africa (DBSA). She is responsible for a team which funds projects in affordable housing, education, and healthcare infrastructure.
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Celebrating 20 years working experience in the financial services industry in 2023, Palesa has exposure spanning across South Africa’s big four banks as well as the key DFIs including the Industrial Development Corporation and the Land Bank of South Africa. Her work experience includes Credit, Workout and Restructuring, Turnaround, Coverage (Relationship Management and deal origination) and Private Equity.
Her sectoral experience is vast and includes funding clients in infrastructure, property, primary and secondary agriculture, financial services (banking, hedge funds, insurance companies, asset managers, microlenders), healthcare, retail, mining, education, student accommodation and housing. In her numerous roles, Palesa has covered clients across SADC, East and West Africa.
Outside of work and academia, Palesa has contributed insightful business and development news from around the continent to the Continent and South Africa’s business media including CNBC Africa, Power FM, and Radio 702. Palesa served as the Co-Chair of the Human Settlements Technical
WOMEN IN REAL ESTATE
Working Group under the Presidency as part of the Inaugural Sustainable Infrastructure Development Symposium from 2019 – 2022 and currently serves as an active member of the Social Infrastructure Technical Working Group. Palesa is recognized as an astute public speaker and Master of Ceremonies, having hosted key international events such as the African Presidential Leadership Conference.
Velda Derrocks - Regional Finance Manger - TUHF
Velda Derrocks joined TUHF as the Regional Manager for the Cape Coastal region in 2017 which includes both Western and Eastern Cape. She began her career in 2000, joining a management training programme at Absa and then moving into Absa Commercial Property Finance. She stayed with Absa until 2011, then joined Standard Bank Real Estate Finance to manage their commercial property finance division in the Eastern Cape. Velda has also worked at Investec Private Bank as an external property consultant.
Throughout her career, Velda has been involved with projects ranging from a few million Rands in investment up to R500 million. She believes that every project is unique and presents an opportunity to develop the economy and grow the property market.
Velda holds a BEcon, Commerce (Stellenbosch University), BComm Honours in Financial Management as well as two Masters degrees – an MBA and an MPhil in Development Finance, both from Nelson Mandela University. She is also an Associate of the Institute of Bankers in South Africa. She also recently completed an International Housing Finance Programme at the Wharton School, University of Pennsylvania.
Velda is a true believer in TUHF’s philosophy of creating impact through scale. “TUHF really makes a difference where it matters most,” she says. “What makes us different is that we see the potential in entrepreneurs, from start-ups to established entrepreneurs, and not just in the project itself.” TUHF works with many entrepreneurs that are new to the property industry and offers programmes that assist them to start building a portfolio.
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Velda’s personal philosophy is to be someone that brings about change. “I’m motivated by the fact that I am bringing about change – in the way people think about investing in cities, in the way entrepreneurs can access finance to fund their ambitions, in the way people in the inner cities live and, in the economies, surrounding the buildings we develop.”
Jackie van Niekerk – CEO Attacq Limited
Jackie Van Niekerk is CEO of Attacq Limited ("Attacq"), the JSE-listed REIT developing Waterfall City in Midrand, Johannesburg. She joined Attacq as CEO in June 2018 and was also appointed to the board. She has over 14 years’ experience in the property industry prior to joining Attacq, and was the CEO of Pivotal where she concluded a successful merger between Pivotal and Redefine Properties.
She has already been named on the prestigious Africa.com 2023 Definitive List of Women CEOs. She is ranked among other exceptional
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African female leaders in major corporations across the continent.
S&P Global's "Women CEOs: Leadership for a Diverse Future" 2022 research found that "women are still significantly underrepresented as CEOs globally, but slightly increased their share to 5.4% in 2022, compared with 5% in 2021. Both the real estate and health care sectors continue to lead with larger percentages of women CEOs". In a recent podcast with S&P Global, Jackie noted the importance of empowerment and creating environments for women to succeed.
Bringing the lens to Africa, a Harvard Business Review highlighted the startling need for more diversity among CEOs of big businesses. To be the CEO of a large, listed company in Africa is an extreme rarity for women; therefore, recognising them is important. Research by Harvard Business School identifies one important factor that all women who reach the CEO spot have in common: resilience.
Jackie took on the CEO role immediately before the COVID-19 pandemic, an uncertain time that
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required resilience, especially in Africa. During and through this turbulent period, she led Attacq with distinction, demonstrating her extensive knowledge and expertise within the property industry.
To mark the evolution of Africa. com's Definitive List of Women CEOs, now in its third year, Africa. com researched and analysed 2,020 listed companies on Africa's 24 stock exchanges. The companies were screened for revenue of $100 million or more or a market cap of $150 million or more, which yielded a list of 787 companies. The public websites of these 787 companies were examined to determine those women with the title of chief executive officer, managing director, or president and to confirm that these executives have a bottom line, profit and loss responsibility.
Michelle Dickens – Deputy CEO, PayProp
Michelle Dickens began her illustrious career as a property manager and soon realised there needed to be a solution for tenants’ persistently poor payment performance.
In 2000, she revolutionised the rental industry when she cofounded South Africa’s only property-specific credit bureau, TPN, at just 24 years old. As CEO, she grew TPN’s database to serve as an authority on tenant payment behaviour. During the pandemic, Michelle initiated a free training programme to promote female representation in the industry and empower young women through meaningful business education.
Michelle joined PayProp as Deputy CEO in October 2022, and in just five months had blazed a trail reenergising the company’s sales and marketing activity. She was named CEO in March 2023 with the challenging but well-resourced goal of accelerating PayProp’s growth in one of its most competitive markets.
Under Michelle’s leadership, PayProp is refocusing its value proposition as an in-bank transacting FinTech platform with a proven track record of enabling on average 29% client business growth in the first year.
Michelle says that the South African rental market is a stable, growing market in terms of the number of tenants. As the housing
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market becomes tougher for prospective homeowners, with rising interest rates and inflation, more people will enter the private rental market instead and stay longer in their properties.
PayProp sees the population of tenants growing and is now the advancing age of tenants. This is an exciting opportunity for rental agents themselves to grow their portfolios, and PayProp will be looking to support that growth opportunity, processing the rental money flows of a growing portfolio of estate agents who are growing their books. Beyond that, we’ll want to look at regions and sectors that we’re not that active in such as commercial, industrial and social housing sectors.
Jabulile ‘Jabu’ Mazibuko - Property Practitioner at Law Real Estate
Born and bred in the city of Gold, Johannesburg, Jabulile ‘Jabu’ Mazibuko was raised by a “tough as nails” and highly driven single mom and is now raising her own daughter and following in her mother’s footsteps of entrepreneurship.
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Jabu has always been creative and after matriculating from St Andrews High School for Girls in Bedfordview, she studied fine arts for a year at Rhodes University. Thereafter she went on to study programming and networking and received a Bachelor of Computing Degree from Monash University. Jabu started a stationery business, followed by a funeral business where she was a funeral director for five years.
In 2012 Jabu had the opportunity to acquire an Interior Decorating Certificate at Inscape College while she was still in the Funeral Industry. In 2018, Jabu responded to a Law Real Estate online advert looking for Real Estate Agents. Jabu had been a client for 10 years, however, knew very little about Real Estate as an agent. She embraced the challenge and is loving every part about the Real Estate world.
Fledging out on her own with her own team of agents working under her guidance, season 2 of the ‘Lising Jozi’ the BBC Lifestyle channel 174 will see Jabu broadening her network as well as area of expertise from not just the South of Jozi, but also showcasing areas like the Vaal, Serengeti, Dainfern, Hurlingham
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and Eye Of Africa. Go to DStv channel 174 on Wednesday’s at 8pm.
Marina Constas – Director BBM
Attorneys & Property author Marina Constas is a specialist sectional title attorney and a director at BBM Law, which has branches in Houghton, Bedfordview, Pretoria, Umhlanga Rocks and Cape Town.
She is an authority on Sectional Title and advises body corporates, Marina is also the co-author of the best-selling book, "Demystifying Sectional Title", which is the definitive guide for anyone living, buying or leasing property in a sectional title complex, or anyone who deals with sectional title in any manner.
Marina Constas is also the founder of Women in Sectional Title (WiST), an organisation working towards supporting women in the property by connecting and sharing information. Marina believes that women are currently, according to Lightstone stats, the largest group of property buyers in South Africa today. She believes however, that they
are largely underrepresented, unacknowledged and unheard of in the property space. Women may be buying and snapping up a lot of properties, but they are still being left out in the cold when it comes to holding key leadership positions and having their voices heard in the property sector.
I am regularly consulted about conflicts in which women involved in different aspects of sectional title – from tenants and owners to trustees – are ignored and even bullied in what is still a largely male-dominated industry.
Careen McKinon, Head of Sales at ooba Home Loans
Careen embarked on her career in banking with the NBS and later joined ooba Home Loans (previously Mortgage SA) in 2001 after completing her BCom degree with a focus on marketing and sales. Her journey with ooba Home Loans began as the Regional Sales Manager in the Western Cape, where her primary responsibility was to expand the
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market share and sales team in the region. During her tenure, the Western Cape team experienced remarkable growth, expanding from 5 consultants to a robust team of 32 over the following years.
In 2006, during the property market boom, Careen assumed a national role, focusing on group acquisitions, especially developments and developers for ooba Home Loans. In 2008, she played a pivotal role in launching their aggregation business, evo, and was instrumental in integrating the acquired business into the ooba Group. Moreover, she concentrated on transforming evo into a strong contender in the origination industry.
With a wealth of experience in the property industry, Careen's passion lies in delivering exceptional service to key stakeholders and business partners. Throughout her extensive involvement in the industry, she has witnessed the highs and lows, as well as the evolving cycles. Living in Cape Town, Careen considers herself fortunate to have the opportunity to travel and immerse herself in diverse cultures around the world.
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Natasha Champion, Regional Sales Manager at ooba Home Loans
Having recently celebrated 20 years’ worth of service with ooba Home Loans, Natasha Champion, Regional Sales Manager for Gauteng North and West has almost achieved veteran status in the property industry. She has sat on various high-profile property panels in the investor training space and regularly shares property commentary on both television and radio and is considered an expert in her field.
Originally from Johannesburg, Natasha began her property career in the UK as a residential real estate agent - including areas such as Brixton where she learnt the practicalities of what it takes to sell property. Coming back to Johannesburg in the early 2000s, she started in an administrative position at ooba Home Loans (at the time, MortgageSA) and moved on to specialise in the development space, before embarking upon the business development area and then on to sales management.
WOMEN IN REAL ESTATE
Today, Natasha runs a team of nine consultants and as a woman in real estate, she believes in empowering South Africans to own their own homes and is particularly excited about the prevalence of female buyers coming up in the market. Her ethos is to maintain lasting relationships through service excellence and is passionate about empowering women to become homeowners, thereby gaining financial independence and security that is so sorely lacking in the South African socio-economic landscape. She believes that there is nothing a focused and determined woman cannot achieve.
Megan Ladbrook, Director, Only Realty Holdings
Megan Ladbrook has been instrumental in the growth of Only Realty over the past decade. As a partner and director in Only Realty, Megan has helped with the strategic acquisition of key brands such as Leadhome, Adrienne Hersch and Frankie Bells, which have all enjoyed bolstered growth as part of the portfolio. In addition,
Megan is a shareholder in Only Realty’s sectional title management business. Best known to the team as a creative workaholic, Megan splits her time between work in Cape Town and in Johannesburg and is mom to two amazing boys.
The future of women in business across the board is exceedingly bright and transformational, and the world has only just begun to glimpse what they can do. However, more initiatives such as Women in Property Network are a key component in ensuring that more women enter the property industry and are uplifted to greater heights.
Women need to take initiative and encourage and educate other women around them. Professionally, we need to see focus on more transformation in the property space and see more black women make waves and an impact in real estate. There are multiple training, bursary and mentorship opportunities that are available where women can learn significantly from one another.
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TRENDING
By Editorial
The inaugural prestigious Residential Investment & Development Conference & Awards (Reside conference) took place recently at the Sandton convention centre in Johannesburg. Part of the inaugural conference was the inaugural Reside Awards ceremony 2023 brought to you by Smart Exchange in partnership with Real Estate Investor (REI) also the event organisers.
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RESIDE AWARDS
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TRENDING
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he objective was to recognize and celebrate excellence in residential property development in the various sectors. Debbie Tagg, COO of Smart Xchange and Neale Petersen founder of REI agreed that that was paramount to honour the visionaries, the innovators, and the trailblazers who have reshaped our urban landscapes and redefined the way we live. Tagg says, ‘Our industry plays a pivotal role in shaping communities and transforming their lives, and the Reside Awards are a testament to the exceptional contributions made by residential property developers.”
The Reside Awards 2023 acknowledged the outstanding achievements of developers across five distinct categories: Residential Developer of the year, Social Housing Developer of the year, Affordable Housing Developer of the year, Retirement Village Developer of the year, and Student Accommodation Developer of the year.
This celebration of excellence in the South Africa’s residential sector was designed to recognise leaders and innovators who are making a positive impact on the lives of South Africans. The awards
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showcase the best of the best in the residential sector, and they provide inspiration and motivation for others to strive for excellence.
For the inaugural awards, nominations were provided by a peer review panel and judged the developments according to the following 5 key Criteria. 1. Innovation 2. Quality Product 3. Environmentally Friendliness 4. Brand Recognition/ Reputation 5. Amenities
RESIDE AWARDS
TRENDING
Reside Awards Judging Panel for 2023 • Marius Muller - CEO & Founder, Soho Properties • Bruce Gordon – CFO - National Housing Finance Corporation (NHFC) • Portia Tau- Sekati - CEO, Property Sector Charter Council (PSCC) • Solomon Ramamaluma - MD, TakeShape Property Management • Chris Campbell - CEO, Consulting Engineers of SA (CESA) • Neale Petersen – Founder & CEO of Real Estate Investor (REI)
The RESIDE AWARD Categories & Winners for 2023 are: 1. Residential Developer of 2023 WINNER – Balwin Properties 2. Social Housing Developer 2023 WINNER – Own Haven for Conradie Park 3. Affordable Housing Developer 2023 WINNER – Africrest Properties 4. Retirement Village Developer 2023 WINNER – Rabie Property Group 5. Student Accommodation Developer 2023 WINNER – Growthpoint Properties
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RESIDE AWARDS
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For our 2024 Awards we will open applications to the industry within the next few months and make announcements on that shortly.
We congratulate all the finalists and winners of the Reside Awards 2023!
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SA Real Estate Investor Magazine JULY/AUG 2023
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DE ZWARTLAND WERK
DE ZWARTLAND WERF
INVESTING
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Expand your property investment toolbox
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Unleash the potential: Explore the advantages of investing in vacant land for development
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Impact Investing: Driving positive change in real estate
SA Real Estate Investor Magazine APRIL/MAY 2023
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INVESTING
Expand your property Harness the power of optimal investment
By Jaco Grobbelaar
Any savvy property investor understands the importance of leveraging smart financial tools to maximise their returns. One such powerful tool I am quite fond of is the access bond. But before getting into why I love it, let’s consider what access bonds are and how you can harness their power and grow your property portfolio.
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ACCESS BONDS
investment toolbox: Access Bonds for growth
SA Real Estate Investor Magazine APRIL/MAY 2023
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W
hat is an Access Bond? An access bond is a home loan that allows borrowers to withdraw surplus funds they have deposited into the bond whenever needed. Or in other words, with an access bond, any additional money you pay into your bond, you can access again when needed.
All banking institutions offer access or flexi bonds. This arrangement enables homeowners to enjoy the advantage of paying interest on a reduced principal amount while still having the flexibility to access the extra money if or when required. Some banks call an access bond a flexi bond.
interest rate without incurring taxes on the interest saved. This approach typically yields higher returns compared to other investment options available. Keeping your surplus money in an access bond is also a sensible choice because it provides the best risk-free return on your investment. This makes it an ideal avenue for accumulating tax-free savings.
The great thing about an access bond is that any money you pay into it is considered a loan repayment, reducing the interest charged since a smaller capital amount is
Two Options to get an Access Bond
1. You can either include the access bond feature in your home loan application and have it approved simultaneously, or 2. You can apply for the facility separately after your bond has already been registered.
Why use an access bond? Depositing surplus money into your home loan account is a wise investment strategy. By doing so, you effectively save at the loan’s
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now outstanding. This either reduces the monthly bond payment or the monthly bond payment remains the same, but the bond is paid off quicker as
ACCESS BONDS
a larger portion of the bond payment is now allocated to capital instead of interest. As a property investor who is keenly aware of my monthly cash flow, I always opt for the first option, where the monthly bond payment is reduced.
As a property investor, you always want to use as little of your own funds as possible. That’s why I always try and obtain a 100% loan from the bank when buying a property. I do this even if I can put a deposit down because I can always pay those available funds into my access bond after the bond has been registered. And it has the same effect as putting
down a deposit beforehand. The only difference is that I have those funds available for future requirements or investments.
It is, however, crucial to note that an access bond does not grant you the capability to borrow the entire amount you have paid into the bond. Instead, you can only withdraw the amount that exceeds your regular monthly instalment. If you want to access the amount of the bond you have already paid off with your monthly instalments, you can apply for a readvance.
‘As a property investor, you always want to use as little of your own funds as possible.’
A readvance is when the bank allows the borrower to access the capital that has already been repaid. This is done by utilising the existing mortgage bond.
Generally, several conditions are associated with this arrangement: • The borrower must maintain
SA Real Estate Investor Magazine APRIL/MAY 2023
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INVESTING
good creditworthiness The value of the property must have either increased or remained stable The repayment period must remain unchanged, and The amount borrowed is limited to the difference between the initial bond and the outstanding balance.
- to healthy levels in case of emergencies or changes in the economic climate. As a property investor, having an emergency fund or reserves in your access bond is a prerequisite. I recommend having at least 10-15% of the value of your properties as cash reserves in your access bond.
I always encourage property investors to refinance all their properties to 100% of the market value as far as possible. That doesn’t mean you need to use all the available funds. You can keep it in your access bond. Remember, cash is king! Having cash available can help you take advantage of opportunities that arise or get you out of trouble… Having a lot of equity means next to nothing in these two scenarios.
Use the funds to expand your property portfolio - cover
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4 Benefits of using an Access Bond Let’s assume you’ve built up surplus funds in your access bonds... Now what? There are four main ways to use the additional money you’ve paid into your access bond. You can:
Leave the funds in there to build up your reserve fund
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ACCESS BONDS
costs such as transfer fees and deposits (if needed) to buy more investment properties.
Use the funds to cover your monthly shortfalls - so you don’t have to pay them from your pocket.
Use the funds to repay loans - you have profited to your property entities and for your enjoyment. This, however,
should only be done if your reserves are healthy.
When used correctly, an access bond is a dynamic tool you can use to expand your property investment portfolio and seize new opportunities. All you have to do is harness its potential and unlock the path towards sustained growth, financial prosperity, and a flourishing property investment portfolio.
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Jaco Grobbelaar Managing Director Prosperity Enterprises
INVESTING
Unleash the potential: advantages of investing development
By Editorial
Investing in vacant land with the intention of building is one of the less common paths to home ownership in South Africa.
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VACANT LAND
Explore the in vacant land for
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F
or those with plenty of patience and very specific ideas for their ideal property, however, building from scratch can offer significant benefits says David Jacobs of Rawson Property Developments. He shares 5 advantages of investing in vacant land.
Lower Purchase Price
“The most obvious benefit of buying vacant land, as opposed to predeveloped property, is that the purchase price is going to be a lot lower,” says David Jacobs of Rawson Property Developments.
This means pretty significant savings on both transfer duty and municipal rates, which are based on purchase price and property value. A lower purchase price doesn’t necessarily mean easier finance. Most lenders will only finance up to around 60% of a vacant property’s purchase price.
“Land buyers generally do need to put a much bigger deposit down on a vacant land purchase. The upside is that you end up paying much less
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in interest over the lifetime of the loan, which can make a big difference in terms of total cost,” says Jacobs.
Strategic potential
With populations growing and cities busting at the seams, new residential pockets are popping up all over the country. Savvy investors can jump on soon-tobe trendy spots which could see significant returns on their vacant land investment before so much as digging their first foundation.
“It’s less risky, of course, to buy land in an already established neighbourhood when possible, but this is inevitably more expensive and may not have quite the same growth potential,” he says.
Blank slate
One of the more popular benefits of buying vacant land is the fact that you don’t have to deal with anyone else’s construction mistakes or poor design choices. That means no home inspections to uncover latent or patent defects, and no immediate maintenance
VACANT LAND
apart from securing the erf and ensuring it stays neat and tidy.
account for any price increases or unexpected challenges.”
It’s always a good idea to do a land survey to understand the underlying geology, topography and potential challenges of a vacant plot. Check the supply of municipal services like water, waste and electricity, and make sure that the necessary zoning is in place for whatever you’re planning to build, continues Jacobs.
Future-forward design
Creative freedom
There is also no substitute for the freedom of being able to build your ideal property from scratch, with no limitations apart from those imposed by geography and/or any title deed conditions.
For most owners, the biggest limitation when building from scratch is budget,” says Jacobs. “It’s a good idea to talk to an architect or builder in advance to get an idea of construction costs, and then budget for at least 30% more than predicted to
Energy and water-saving features have become huge value-adds for South African households, but retrofitting these to existing structures isn’t always easy or affordable. Building from scratch offers an unparalleled opportunity to enjoy the full spectrum of modern green building initiatives more effectively, efficiently, and affordably.
Consider hybrid or fully off-grid power setups, rainwater collection and greywater recycling systems, along with energy saving features like double glazing. They do, come at a premium which can be challenging on a tight budget. “However, long-term cost-savings – not to mention added value to the property – should more than make up for that initial investment within just a few years, he concludes.
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SA Real Estate Investor Magazine JULY/AUG 2023
INVESTING
Impact Investing: in real estate
By Editorial
When it comes to distressed property owners, how can we ensure their well-being while also protecting investors and achieving excellent returns? We explore the concept of impact investing and its significance in driving positive change in the real estate sector.
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DISTRESSED PROPERTIES
Driving positive change
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I
mpact investing is the practice of making investments that aim to generate both financial returns and positive social or environmental impact. While traditional real estate investment has primarily focused on financial gains, impact investing recognizes that investments can be a catalyst for addressing pressing social and environmental challenges.
There are several key reasons why impact investing is important in the real estate sector. Firstly, it provides a means to address social and environmental issues. Investments can be directed towards projects such as affordable housing, energy-efficient buildings, urban regeneration initiatives, and community development. By focusing on these areas, impact investing helps tackle crucial issues like housing affordability, climate change, and social inequality.
Secondly, impact investing promotes long-term sustainability in the real estate industry. Through investments in energy-efficient buildings, renewable energy infrastructure, and green technologies, resources are conserved, and carbon emissions are reduced. By supporting
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sustainable practices, impact investing contributes to the longterm viability of the real estate sector and the well-being of the planet.
Another significant aspect of impact investing is stakeholder engagement and collaboration. This approach involves actively involving local communities, stakeholders, and residents in the decision-making process of real estate projects. By considering the needs and aspirations of the community, impact investing leads to more inclusive and responsible development. It fosters partnerships between investors, developers, nonprofits, and government agencies, ultimately driving positive change at a systemic level.
Moreover, incorporating environmental, social, and governance (ESG) factors into real estate investments helps mitigate risks and enhance reputation. By proactively addressing sustainability issues and societal concerns, real estate portfolios become more resilient to regulatory changes, climate-
DISTRESSED PROPERTIES
related events, and reputational damage. Investors and developers who prioritize ESG factors improve their reputation and establish themselves as responsible industry leaders.
Furthermore, rising interest rates directly affect existing homeowners with adjustable-rate mortgages or variable interest rates. As interest rates climb, their monthly mortgage repayments also rise, placing many homeowners in financial strain. For those already experiencing financial distress, these additional costs can lead to a higher rate of default, further contributing to the number of distressed properties on the market.
Real Estate Assist offers a unique approach to help distressed homeowners in South Africa. Our focus is on enabling homeowners to keep their properties while recovering from financial difficulties.
We aid in unlocking equity for immediate financial needs and maximizing proceeds from property sales. Our commitment extends beyond short-term fixes, aiming to create
lasting results and protection for both homeowners and real estate owners including both residential and commercial properties.
Additionally, we specialize in helping non-qualifying prospective homebuyers overcome obstacles to homeownership. Whether it's due to factors such as not meeting mortgage criteria, insufficient deposit, adverse credit history, being a first-time buyer, or wanting to test the waters before committing, our tailored solutions bridge the gap between aspiring homeowners and their desired properties.
Our structured real estate solutions, which are not commonly available, prioritize transparency and empower distressed homeowners to make informed decisions about their assets. By embracing our approach, distressed homeowners can find solace and assistance, while aspiring homeowners can seize opportunities to fulfill their dreams of owning a home. Visit our website and get in touch with us today. www. realestateassist.co.za.
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SA Real Estate Investor Magazine JULY/AUG 2023
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LEGAL
Understanding Tenants' Landlords' Responsibilities: Eviction Laws in South
By Simon Dippenaar
The relationship between property owner and occupier should be a happy one. After all, it offers a reciprocal and mutual benefit. One earns a passive income from an owned asset, and the other enjoys a home to live in, without the weight of responsibility that come with property ownership. Unfortunately, the relationship is not always friendly. Friction can emerge because of unpleasant behaviour by either party.
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EVICTION LAWS
Rights and A Guide to Africa
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LEGAL
L
andlords can be unresponsive or unreasonable. Tenants can be disrespectful or negligent. South African law contains multiple pieces of legislation governing rental housing, and both landlords and tenants are accorded rights that protect them. They are also assigned responsibilities they must uphold. But the balance tends to lean towards tenants’ rights and landlords’ responsibilities. In this article we examine them both.
UNDERSTANDING TENANTS RIGHTS The South African Constitution gives people certain inalienable rights. How do they apply to tenants?
Right to fair treatment in law A landlord cannot evict a tenant without going through the correct legal procedures. Unfortunately, some landlords take it upon themselves to involve municipal law enforcement to evict tenants. The Prevention of Illegal Eviction from and Unlawful Occupation of Land Act No 19 of 1998 (PIE) is a key piece of legislation in South Africa that regulates the process of eviction. It was enacted to protect both property owners
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and tenants, ensuring that evictions are carried out in a fair and lawful manner.
The courts take eviction law very seriously. Failure to follow the correct process could result in a heavy fine for the landlord, as well as damages payable to the tenant. In the worst-case scenario, the landlord could end up in jail, facing serious criminal charges.
Right to adequate housing The Constitution recognises the right to adequate housing as a basic human right. No one’s property may be taken away from them and no one may be evicted from their home without a court order. This means a landlord must apply to court before evicting a tenant from their property.
The court must be satisfied that there is alternative accommodation available to the tenant before ordering the eviction. This can be state housing, as the state has a duty to provide housing to all its citizens. If the tenant has occupied the property for over six months, PIE does not allow the tenant to be evicted
EVICTION LAWS
without having first secured alternative accommodation.
Right to legal representation The law gives a tenant the right to defend against an illegal eviction if a landlord forces them to leave the premises without appropriate notice. Ownership does not give a landlord the right to evict a tenant without following the correct procedure.
Tenants have the right to legal representation during the
LANDLORD GENERAL OBLIGATIONS
The landlord has the responsibility to: 1. Deliver the property to the tenant for their use and enjoyment. The landlord must provide everything necessary for the tenant to use and enjoy the property, for example, keys, remotes, etc. 2. Maintain the property in good order and condition for the duration of the lease agreement. Correspondingly, the tenant should report any defects in the property to the landlord. 3. Ensure the tenant’s undisturbed use and enjoyment of the property, i.e., the tenant’s privacy.
LEGAL
eviction process. If a tenant cannot afford a lawyer, they can seek assistance from Legal Aid South Africa or a pro bono attorney. Further information regarding Legal Aid is available online or from the Registrar of the High Court.
Understanding landlord responsibilities Landlords have a set of responsibilities towards their tenants. Legislation is motivated in part by past abuses and rental housing law ensures tenants cannot be exploited or unfairly treated.
Landlord legal procedures The PIE Act clearly defines the procedure the landlord must follow to evict a tenant. A property owner must not take the law into their own hands, for example by cutting the electricity or water supply to the property or intimidating the unlawful occupier into vacating the property.
A landlord can only consider eviction in the event of a breach of the lease agreement which the tenant has failed to rectify. If the lease is coming to its
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EVICTION LAWS
natural end and the landlord does not wish to renew it, they simply give the tenant notice to quit per the terms of the lease agreement. This is not eviction.
Steps in the eviction procedure if tenant breaches agreement
1. Notify the tenant of the breach.
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The landlord must issue a warning to the tenant in writing, giving them a specified amount of time to remedy the breach. This time frame is determined by the terms of the lease. Unless otherwise specified, it is 20 working days, in accordance with the Consumer Protection Act (CPA). The CPA is designed to protect consumers in various transactions, including rental agreements. It sets out specific requirements for notice periods and other aspects of the landlord–tenant relationship. If there is no written lease, the landlord must give a full calendar months’ notice. If the tenant rectifies the breach, the matter is finished. If the breach is not remedied within the designated time, the landlord notifies the occupier
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LEGAL
•
in writing that the lease is to be cancelled and gives the occupier reasonable time to vacate the property. The notice period required to cancel the lease, like the time allowed to remedy the breach, is dictated by the lease. If no time frame is stipulated, or in the case of a verbal lease, a minimum of one calendar months’ notice is required (end of the current month to the end of the following month).
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4. The hearing
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2. Apply for a court order.
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If the occupier fails or refuses to vacate the property, despite being given adequate notice, the landlord may approach the court to start the eviction procedure. The court provides the landlord with a date and time for the eviction hearing.
3. Serve notice on the tenant
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Written notice of the eviction hearing must be personally served on the unlawful occupier of the property, as well as on the local municipality. This notice must be served by the sheriff at least 14 business days before the eviction
JULY/AUG 2023 SA Real Estate Investor Magazine
hearing in court. The notice must indicate the date and time of the eviction hearing, the circumstances surrounding the eviction, and the unlawful occupiers right defend themselves.
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At the eviction hearing the court will hear the matter and decide whether to grant the eviction order. The occupier may defend the eviction. The court will consider factors such as children, elderly or disabled tenants, and womanheaded households, and the availability of suitable alternative accommodation when granting the eviction order. In certain circumstances an order may be granted but “stayed” – delayed – to give the occupier more time to find another home.
Respecting tenant’s rights Landlords must respect the rights of tenants during the eviction process. Harassment or intimidation of tenants is not permitted.
The landlord is not allowed to
EVICTION LAWS
enter the tenant’s premises or remove doors to speed up the eviction process. The provisions of the Rental Housing Act are clear on the rights of tenants. The tenant’s rights include the right not to have: • Their person or home searched • Their property searched. • Their possessions seized, except by court order.
Balancing rights and responsibilities Evictions are complex processes that require a careful balance between the rights of tenants and the responsibilities of landlords. It is also important to be mindful of ethical considerations, as
South Africa has an acute housing shortage at present and a fragile economy.
It is always better to try to resolve disputes through negotiation and, if necessary, mediation. Seeking an eviction order through the courts should be the last resort.
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Simon Dippenaar Eviction Specialist Simon Dippenaar & Associates
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INVESTOR INTELLIGENCE
SA Real Estate Investor Magazine MAY/JUNE 2023
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INVESTOR INTELLIGENCE
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FINANCE
Safeguarding your Business: Essential strategies
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TRENDING ONLINE
Securing your ideal property amidst high interest rates: Fearless tips for investors in a buyer’s market
Breaking down persisting hurdles for Barriers First- Time Homebuyers
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FINANCE
Safeguarding your strategies to prevent Money Laundering
By Editorial
Money laundering (ML) refers to the passing of illicit , or ‘dirty’ money, through a sequence of transfers, changes or commercial transactions that eventually returns the ‘clean’ money to the launderer in an obscure and indirect way, usually via a respected institution, where it will not be linked with the original crime.
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MONEY LAUNDERING
Business: Essential involvement in Schemes
PART
02
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I
n Part-2 of this 2-Part Series we uncover three more examples of money laundering and ways of how to combat it.
Selling and reselling assets Whether it be in cash or an online transaction, the origin of money can be made to look legitimate through the reselling of goods. Perpetrators often purchase big-ticket items, and then quickly resell those items to make their money look transaction based. Rolexes, Real estate, luxury cars, luxury yachts and expensive jewellery and other such items are popular placements for money laundering.
Another example is setting up a business such as a “luxury” carpet shop and then
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declaring “goods have been purchased using cash” meaning that the cash gets disguised as legitimate money from an item sold, where in fact there was no item or the item was of little value but has been sold for a large sum of money.
How to combat it In the example above, it shows why property owners / developers should perform FICA checks on the people they are letting office or shop space to.
The FIC Amendment Act (FICAA) stipulates that Accountable Institutions should adopt a riskbased approach when establishing a business relationship and/or conducting a single transaction with a client. Part of this risk-based approach includes developing controls which mitigate and manage the businesses AML risks, and fulfil the FICAA requirements.
MONEY LAUNDERING
All the controls developed and implemented should be documented to form part of their RMCP. Part of taking a risk based approach is performing customer due diligence (CDD). CDD refers to the process of analysing information about an individual or legal person from multiple sources. This means that to adequately perform due diligence you will need to collect and evaluate specific information to truly know your client and ultimately ensure that your client is who they say they are.
DocFox can assist you with developing an RMCP that is unique to your business as well as can assist you in truly getting to know your client by collecting and analysing documentation and screening your client against sanction lists.
laundering refers to individuals or businesses that take advantage of the complexity of international laws and regulations for their illicit purposes. For example a money launderer may alter invoices or the value of goods, move funds through different countries, or get several individuals or businesses involved to try make funds look legitimate or ultimately use these creative changes to evade AML checks.
How to combat it: As recommended by the Financial Action Task Force (FATF) and Financial Intelligence
Trade-based money laundering Recently released and estimated that mis invoicing was responsible for 63% of trade based money laundering. Trade based money
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Centre (FIC), geographic risk is an important component to consider when assessing client and transaction risk as each country poses different levels of risks based on the features and activities that are associated with it, you can read more about this here.
Also in conjunction with taking someone's geographic location into account, you should also perform due diligence on businesses that you are working with.
Common documents requested to perform due diligence on Juristic entities include: Company statutory documents • Certificate of Registration • Memorandum of Incorporation • Certificate of Name Change (if applicable) • Signed by a director of the company;
Proof of physical operating address • Invoice • Rates bill • Letter from the Auditors confirming shareholding
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SARS issued document confirming Income Tax and VAT registration number • Directors resolution appointing the authorised representative of the Company; • Certified copy of the ID document of the Directors/ Partners/Members as related parties, UBO/s and authorised person/s;
Certified proof of residential address of Directors/Partners/ Members as • Related parties • UBO/s • Authorised person/s;
Although there is no single globally accepted list that accountable Institutions can rely on to determine the risk posed by a particular area, the FIC considers the listings issued by the FATF as a minimum.
Shell companies and complicated structures A more commonly known method of money laundering is where money launderers use companies, trusts or other similar legal
MONEY LAUNDERING
arrangements to retain control over criminally derived assets. A very prevalent and infamous example of this would be the Digital vibes saga. Due to the fact that these criminals use complex structures or legal persons to conceal true ownership makes it often very challenging to trace back to the original source of funds as well as to identify UBOs.
How to combat it The concept of identifying an Ultimate Beneficial Owner (UBO) exists in an effort to combat the above. A UBO is effectively the person/s at the top of the tree – who have ultimate benefit from, or ultimate control of an entity
and its operations.
Whilst it’s usually a natural person majority shareholder holding 25% of the entity and above, not all entities have a majority shareholding or even shareholding at all e.g.: a listed company having thousands of shareholders with no clear majority holder over the 25% threshold. In this case you can take a risk-based approach and use a process of elimination, looking first for ownership, and then control e.g.: the CEO, CFO or COO of a listed company, and then identify these individual/s as the UBO’s.
In the same way you must identify and verify your clients, the FIC Amendment Act requires that you identify and verify all UBOs.
In closing you can see that there are multiple ways that criminals try and launder money. Together with international guidelines, the FIC has set out the FIC Act which serves as a basic guide / requirement that all Accountable Institutions need to follow in order
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to reduce the risk of facilitating money laundering.
In order to combat crime, businesses should identify and assess the risk of all their customers as well as put together an RMCP that will guide all employees, in other words all employees of AIs should be trained on the anti-money laundering procedures in the business described within the RMCP and have adequate knowledge of FICA itself.
Finally it is important that businesses monitor, review and audit these processes to ensure that they are consistently being followed at all times, which is a challenging task.
This is why we recommend that businesses use software like DocFox to make sure these steps are followed correctly each and every time.
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MONEY LAUNDERING
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WEALTH
Accelerate your Real Estate business: 7 Time saving tips to propel you to the next level
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6 myths of a discretionary living trust – Protect your assets
Where There’s No Will, There’s Drama & Consequences!
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Accelerate your Real 7 Time saving tips to the next level
By Editorial
We can all agree that there are few things in life as valuable as time. Think about this moment. Once it is gone, you will never be able to get it back.
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7 TIME SAVING TIPS
Estate business: propel you to
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WEALTH
I
t is such a finite resource yet we have to navigate it carefully as all the ingredients for success, prosperity, happiness, health and growth are linked to it. Every moment that you are alive you have the privilege of living minutes that you will never get back. It is as true for your personal life as it is in business.
As a real estate agent running your own business there is no moment more important and more perfect than right now to start spending your time wisely.
Think of your time in terms of money. Say you have a R1 000 to spend every day. Where do you spend your money in order to make sure you receive a good return on investment?
“From discussions with hundreds of agents over the years, I can state that proper time management is one of the most important differentiators between successful agents and those that are not,” says Antonie Goosen, Principal of Meridian Realty.
7 TIME SAVING TIPS
7 Time saving tips to propel you to the next level
01 Schedule everything. If it is not in your calendar it doesn’t exist. Once a year, sit down and decide on your goals for the coming year. Write them down and commit to them. Then diarise the most important tasks you will need to consistently perform in order to reach your goals for the coming year.
Use a weekly schedule and time block the most important tasks on a daily and weekly basis. One tip is to time block at least one Hour of Power every day during which you reach out and make contact with old clients and talk to new potential prospects. Also make
sure to block sufficient time in a year to relax – time block weekends away and a proper holiday or two well in advance as stick to it.
Treat every time block as a commitment that you have to meet and work the rest of your schedule around these times.
02 Turn off notifications that distract you We live in the digital age and people have never been so inundated with information and constant alerts demanding (and therefore taking away) our attention. One simple but very effective hack to eliminate some of this information distraction is to take control of the setup of the notifications on your smartphone and or
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tablet devices.
By turning off notifications from apps that are not critical, you will find that you will be much less inundated with notifications. You will be much more
productive when you’re able to focus on one thing at a time an complete the task at hand before moving on to another.
03 Progress = Happiness
Start with the hard tasks first thing in the morning and get it out of the way. Do that one thing that you know you need to do to feel like you’ve accomplished something. It is usually the activity
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04
06 Do something unrelated that you put off and leave An estate agent’s daily tasks can for the end of the day when be segmented into different you’re exhausted and don’t types of activities. Change have the energy. it up by coupling telephonic Make time for it first thing in canvassing with something the morning. The sense of that does not involve talking to accomplishment you get from clients like doing a valuation or doing that ‘looming’ activity other admin related tasks. This you tend to put off, will fuel you will refresh your brain and will for the rest of the day. help you to do different tasks with a sense of renewed energy. Reward yourself
When you set out a goal and 07 Stay away from multi–tasking accomplish it, make a point We all think that we are master of it and take the time to jugglers, but it has been reward yourself. You will end scientifically proven that we up teaching yourself that it’s are mentally not built for that. about MORE than simply doing Focusing on one thing at a time what you set out to do. You will make you more productive can lie to everyone else but and in order to do that, you yourself. The joy that comes have to get rid of distractions. from doing exactly what For example, put your phone you set out to do cannot on silent when you are be overstated. performing a tasks that needs your full focus. 05 Take small regular
breaks It’s proven that the top 10% of performers take 10 – 15 minute breaks after every hour. It helps you to refocus your mind and you will end up being more productive because of it.
By incorporating these 7 tips into your daily life, you will see that you can control and use your time much more productively.
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TECHNOLOGY
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Guarding against Cybercrime: South Africa earns unfortunate title as Africa’s Cybercrime capital
TRENDING ONLINE
Tech, data and AI hold solutions to the residential property market
Buildings, meet your digital twin
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TECHNOLOGY
Guarding against Cybercrime: South earns unfortunate title Africa’s Cybercrime
By Editorial
Recent data from TCG Forensics shows that South Africa is rapidly emerging as the ‘cybercrime capital’ of Africa, poised to surpass Nigeria and its notorious ‘Nigerian Prince’ scams in terms of cyber-criminal activity.
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CYBERCRIME
Africa as capital
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“D
espite substantial investments from both the private and public sector in boosting cyber security and the passing of the Cybercrimes Act in 2021, thousands of innocent South Africans continue to fall prey to these types of crimes each year,” comments Jackie Smith, Head of Buyers Trust (a subsidiary of ooba Group) and a safe and secure bank-hosted deposit solution for homebuyers.
Highlighting the surge in cybercrime, the Southern African Fraud Prevention Services reported a staggering 356% increase in impersonation fraud between April 2022 and April 2023.
Why is South Africa so vulnerable to cybercrime? Several factors contribute to South Africa's vulnerability to cybercrime, the first being the last two decade’s economic expansion and evolving digital landscape, which makes it an attractive target for criminals seeking quick financial gains.
“Cybercrimes can be committed by anyone with access to a cell phone and an internet connection, making these crimes incredibly easy to perpetrate,” says Smith.
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“And with only an estimated 10% of cybercrimes reported to the police, criminals feel that they can operate without consequence.”
Another reason why cybercrime has escalated to such a degree is that there are only a small number of police officers equipped with the specialised skills needed to address cybercrimes. Consequently, the prosecution and policing of cybercrimes become exceedingly difficult, allowing sophisticated organised crime syndicates to operate with relative ease in the country.
Cybercrimes can be anyone with access to a an internet connection, crimes incredibly easy
The property industry and cyber threats The property industry has become an attractive target for cyber criminals due to the vast amount of valuable personal data involved and financial transactions that take place daily.
“As a company that was
CYBERCRIME
developed in part to give the highest level of security to the deposit component of real estate transactions, we have first-hand insight into how vulnerable the industry is to cyber threats,” explains Smith. She identifies the two primary types of cybercrimes that the property industry should prioritise and be wary of: 1. Data breaches Property companies handle large volumes of personal and financial data related to buyers, sellers, tenants, and landlords – including addresses and debit and credit card details.
Cybercriminals may attempt to hack into online databases and gain unauthorised access to this data to commit identity theft, financial fraud, or sell the information on the dark web.
2. Deposit phishing schemes Here, fraudsters will intercept emails between a buyer and seller to pose as a legitimate real estate agent or conveyancing attorney to divert the buyer’s deposit into their own bank account.
“Unfortunately, it can be very
committed by cell phone and making these to perpetrate,”
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difficult to tell the difference between a legitimate email communication and one sent by a fraudster,” says Smith.
This is because cybercriminals are becoming increasingly sophisticated, hacking into the attorney or real estate agent’s firm to study the language used, company letterhead and transaction types. This allows them to craft phishing emails that appear totally legitimate, while the
unsuspecting buyer is cheated out of their hard-earned deposit.
“Attorneys and estate agents are not cybersecurity experts - nor are they expected to be - but that does increase the likelihood of these crimes occurring. The best way to minimise the risk of falling victim to a phishing scheme is by entrusting your deposit to a highly secure and transparent third-party alternative, which also offers a bank guarantee,” she adds.
5 Ways to protect yourself from email phishing scams
Be cautious with email links and attachments. “Avoid clicking on suspicious links or opening attachments from unknown or untrusted sources.”
Double-check email senders. “Scrutinise the email sender's address carefully and be wary of emails that have slight variations or misspellings in the sender's name or domain.
Verify website authenticity. “Before entering any personal or sensitive information on a website, ensure it is secure. Look for "https://" in the URL and a padlock icon in the browser's address bar.”
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CYBERCRIME
Don't share sensitive information. “Avoid sharing details like passwords, identity numbers, or account numbers over email or unfamiliar websites.”
Take the ‘human element’ out of the equation. “The Buyers Trust platform employs the highest level of cyber security measures, ensuring that your deposit will be protected until the property transfer process is complete,” she concludes.
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Jackie Smith Head of Buyers Trust Ooba
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Hi, I’m Jacques Groenewald
A passionate, family-orientated iAgent and a committed member of my community
Navigating people’s property journeys is my passion and family is at the heart of everything I do. I started as a real estate agent because I enjoyed working with people and solving problems. Now, with the freedom and support of Meridian Realty, I am shaping my success and making a difference in my community.
www.meridianiagent.co.za
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Registered with PPRA
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Semigration: the rebirth of the suburbs and towns in South Africa
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Adapting to the E-commerce era: How industrial real estate 38 can thrive and stay competitive
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Gender safety first: A Commercial property invest- 38 ment grade hinges on women’s security
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Semigration: the rebirth and towns in South
By Editorial
Personal technology and digital connectivity have advanced so far and so fast that people are asking, “Do we really need to be together in an office to do our work?”
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COMMERCIAL
of the suburbs Africa
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W
e got our answer during the pandemic lockdowns, and we learned that a great many of us don’t, in fact, need to be collocated with colleagues onsite to do our jobs. Individuals, teams, and entire workforces can perform well while being entirely distributed.
Out Migration from Cities Up Smartphones, smart-remote offices, smart homes, smart cars, smart shopping and now, slowly and necessarily, the reshaping of South Africa’s urban centres as smart cities. Semigration is a growing global trend that has seen individuals and families move locally in search of a more
NEW RESEARCH BY IWG REVEALS - BOX THIS REVERSE TYPE
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Suburbs and dormitory towns are being revitalised as hybrid workers ‘semigrate’ out of city centres After Covid, the work-from-home lifestyle has led many to re-evaluate the quality of their home life. Naturally, they concluded that working from home is much more enjoyable when you have inspiring scenery and a rejuvenating outdoor lifestyle. In South Africa, domestic migration to smaller cities and rural areas is also accelerating compared to pre-pandemic levels Hybrid working continues to grow in popularity, with almost 70.1% of companies supportive of hybrid work practises in South Africa, according to the latest Cisco Global-hybrid-work-study-2022
COMMERCIAL
balanced lifestyle.
In South Africa, most out-ofcity moves are 'semigration' related, i.e., people choosing to move to a different location within the country. The highdemand provinces are mostly considered as lifestyle or holiday as well as retirement destinations, specifically the Western Cape and KwaZulu-Natal coastal provinces. Additionally, peripheral and suburban areas in metros and secondary cities and towns have seen a resurgence of interest, and this time for permanent occupation.
The most common move during the pandemic was from the city centre to the suburbs; however, many people left large cities altogether, opting for less expensive or smaller cities and towns. It is now more than just the
wealthy or retired, considering outlying and remote areas as primary residences. An enhanced focus on lifestyle, surroundings, quality of life and issues such as personal safety is seeing people of all ages, married, single, and families considering 'semigration'.
The ‘Zoom Boom’ The ‘Zoom Boom’ has sparked mass migration from urban cities to smaller towns. Investors moving their wealth worldwide in search of greener pastures, greater returns, and more security is not a new concept. Now influenced by the 'zoom boom', major cities are experiencing a mass exodus as property buyers invest in suburbia, offering a higher quality of life for a fraction of the cost.
"The workplace is going through a transformation, which is characterised by decentralisation,
FLEXIBLE OFFICES
as employers give employees the opportunity to work where is most convenient and productive for them, often in the hub and spoke model”, says Joanne Bushell, IWG MD, South Africa.
This model provides geographical flexibility, allowing employees to choose where and when to go into a flexible workspace. IWG Plc. (Regus, SPACES and HQ in South Africa) have over 60 centres throughout the country, allowing employees to choose where to work. “I believe it’s our responsibility to support other local businesses so we can all grow together. By creating hubs in the communities where employees live, we’re fostering greater community connection and business growth”, adds Bushell.
According to the chief executive of the Pam Golding Property Group, Dr Andrew Golding, semigration is not a brand-new trend that arose solely as a result of the pandemic. He says it has
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COMMERCIAL
been taking place over the past five to seven years, primarily in coastal living and estates. The latest new normal is decentralising urban living from the greater metropoles to urban areas in smaller towns and cities.
Business opportunities can be won or lost in a matter of minutes. Having employees who can work from anywhere, at any time, and aren't tied to their desks means small businesses can be more responsive. In fact, being fleet of foot is one of the most significant advantages over larger competitors.
IWG has signed partnership deals with Standard Chartered and Ernst and Young, amongst others, enabling them to work from any of IWG’s 3,500 workspaces globally. Today's smart office technology empowers people to choose how they do their best work. And that means everyone on the team can make the right choices for them.
Some may thrive being in the office most days. Others may prefer to spend more time working remotely. With innovative office technology and the right
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serviced office environment close to home, it is a win-win situation for the entire team.
Growth of hybrid work solutions in small towns and suburbs According to IWG footfall data from the last year, the demand for workspaces outside of busy city centres has grown by 36%. In fact, centres in suburban, town and rural locations have seen some of the most significant increases in attendance, with workers increasingly forgoing lengthy commutes to work locally.
providing a combination of nonwork services, entertainment, residential options and workplace facilities to cater to the new working population.
Mark Dixon, CEO of IWG, commented: “The pandemic has proven the ability of global workforces to work effectively in different ways and in different places. Our research shows that hybrid working will continue to be very popular with employees and businesses.
A greener future Proven over and over, hybrid working patterns also positively impact the environment and local economies.
We’re seeing a fundamental change in the geography of work with significant opportunities for the economies and communities of towns and cities globally. Previously, smaller cities, towns and rural communities faced an existential threat as many of their most energetic and economically active members were being shipped out to a city five days a week, returning only to rest before setting off again.
Ultimately, this shift means the role of city centres worldwide is changing. With the rise of the 15-minute city within large city boundaries, global cities need to future-proof themselves by
Now, hybrid working is allowing easier access to the best talent, invigorating local economies and enriching communities. Not only this, but it’s set to change the role of cities forever.
To cater to this demand, IWG will add 1,000 locations globally over the next year, and the majority will be in suburban and rural locations – including in towns with populations as small as 10,000
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COMMERCIAL
Employees have realised that hours have been wasted commuting to an office that they don’t need to be in, whilst businesses have seen that a hybrid model means not only happier and more engaged employees but also significant cost savings. This shift also has the potential to transform local economies.”
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ABOUT IWG, INTERNATIONAL WORKPLACE GROUP
IWG is the global operator of leading workspace providers. Our companies help millions of people and their businesses to work more productively. We do so by providing a choice of professional, inspiring, and collaborative workspaces, communities and services.
Digitalisation and new technologies are transforming the world of work. People want the personal productivity benefits of living and working how and where they want. Businesses want financial and strategic benefits. Our customers are start-ups, small and mediumsized enterprises, and large multinationals with unique business goals, people, and aspirations. They want workspaces and communities to match their needs. They want choice.
Through our companies, we provide that choice and serve the whole world of work: Regus, Spaces, HQ, Signature and Basepoint. We create personal, financial, and strategic value for businesses of every size, from some of the most exciting companies and well-known organisations on the planet to individuals and the next generation of industry leaders. They all harness the power of flexible working to increase their productivity, efficiency, agility, and market proximity.
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Adapting to the industrial real estate competitive
By Rael Levitt
Industrial real estate in South Africa must adapt to the growth of e-commerce by providing flexible warehousing solutions, partnering with logistics companies, and investing in technology and infrastructure.
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E-commerce era: How can thrive and stay
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he rise of e-commerce in South Africa has significantly impacted the logistics and warehousing industry. With the growth of online retail, small and medium-sized enterprises (SMEs) face distinct challenges and thereby have distinct needs. The industrial real estate sector must adapt to meet these needs to remain competitive. In this article, we will explore the impact of e-commerce on logistics and warehousing. We go on to suggest strategies that
industrial real estate companies can adopt to remain competitive in the era of e-commerce.
Understand the e-commerce climate According to recent statistics, e-commerce sales in South Africa are expected to reach R225.4 billion by 2025. The growth of e-commerce has created unique opportunities for SMEs to enter the online retail space. However,
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this growth puts pressure on the industrial real estate industry to provide flexible and adaptable warehousing solutions to accommodate the specific needs of SMEs.
This requires investment in technology and infrastructure that support the efficient movement of goods. High-speed internet, reliable transportation networks, and streamlined warehousing and logistics operations are all factors that need to be considered.
Embrace flexible leasing & adaptive spaces One of the
critical challenges facing SMEs is the need for an ‘elastic’ warehousing space that can expand and contract as needed. This is particularly important for businesses that experience seasonal fluctuations in demand, or businesses that need to scale their operations quickly.
To meet this need, industrial real estate companies must provide flexible warehousing solutions geared toward the unique needs of e-commerce businesses. This requires a shift away from traditional leasing models towards newer flexible leasing models.
Flexible leasing models allow tenants to adjust their space requirements as their business grows or contracts. By offering flexible and customizable leasing options, landlords can attract and retain SMEs in a highly competitive market.
Partner with logistics companies A vital consideration for SMEs in e-commerce is lastmile delivery; the final stage of the delivery process from the warehouse to the end customer. This can be a significant
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challenge for SMEs, as they often lack the resources to establish and maintain their own delivery networks.
By partnering with logistics companies or offering valueadded services such as shared delivery networks, the industrial real estate sector can assist SMEs to overcome this challenge and expand their customer reach.
Invest in technology & infrastructure To remain competitive in the era of e-commerce, the industrial real estate sector must invest in technology and infrastructure that supports the efficient and costeffective movement of goods. This includes the use of advanced warehouse management systems that automate inventory management, order fulfilment, and other logistics operations. With the use of these systems, the industry can reduce costs and improve operational efficiency, ultimately benefiting both tenants and landlords.
In conclusion, the growth of e-commerce in South Africa creates significant opportunities for SMEs to compete in the
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online retail space. Industrial real estate must continue to adapt. In order to meet the changing needs of SMEs and remain competitive in the rapidly evolving e-commerce industry.
SMEs engaged in e-commerce require flexible and customizable warehousing solutions tailored to meet their specific needs. And last-mile delivery is a cornerstone of effective e-commerce. For the benefit of both SMEs and landlords, industrial real estate companies should offer ‘elastic’ warehousing space and flexible short-term storage solutions.
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Rael Levitt Founder & CEO Inospace
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Gender safety first: A investment grade security
By Mantsi Moiloa
In the world of real estate, the mantra "location, location, location" remains a golden rule.
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Commercial property hinges on women’s
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A
property situated in a prime area with easy access to transport, amenities and facilities is typically considered a favourable investment choice. In addition, commercial properties with modern designs, adequate space and up-to-date technology will appeal more to potential investors. Market trends impact supply and demand and investment potential. The overall economic stability of a country or city also has a considerable effect on the value of commercial property assets.
One of the key factors in determining if a commercial property is investment grade that often gets overlooked, however, is the safety of women and its direct impact on the valuation of commercial property assets.
Properties in an area that cannot ensure security for all, especially for women who are a big part of our workforce and face a higher likelihood of being victims of crime in South Africa, simply aren’t investment grade.
South Africa is ranked among the most dangerous countries in the
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world for femicide and has one of the highest instances of rape in the world. Given these alarming facts and social responsibility mandates, we need to make our cities environments that are welcoming spaces for everyone in order to attract investment.
When it comes to commercial property, potential investors take such safety issues into account when considering the value and investment potential of properties. Good businesses take seriously their duty of care for employees’ safety.
A property owner can go to great lengths to ensure that their building offers a safe environment, but no building is an island. Each one is impacted by the urban fabric around it – public spaces, resources and infrastructure and neighbouring properties, both public and private.
While the government must take a proactive role in crafting policies and investing in infrastructure that pursues safe and investable spaces,
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public-private partnerships (PPPs) can amplify these efforts.
Through PPPs, resources from both sectors can be pooled together, allowing for improved infrastructure development, effective policing strategies, wellmaintained public spaces, wellfunctioning public buildings, and appealing commercial districts. Government departments can join forces with private entities
that share the same dedication to building safe, inclusive communities. Leaders from both sides can pave the way to more sustainable urban development.
For instance, good street lighting and surveillance systems foster a feeling of safety within communities. It also helps when all the buildings in an area are well managed and maintained, with good occupancy levels. Infrastructure development projects that consider
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gender-inclusive urban planning play a pivotal role, such as femalefriendly transportation systems.
Collaborative efforts make cities more appealing by promoting a secure environment where employees – particularly women – can feel safe while working or residing within the area. This appeals to a diverse range of inhabitants who bring with them sought-after talent and skills, the lifeblood of any organisation.
At Cushman & Wakefield | BROLL, we believe opportunities abound for public-private partnerships to tackle real estate challenges headon – with win-win results.
Safer cities drive up demand for properties – commercial and residential – making them more valuable and increasing the tax base for the government.
Conversely, when left unchecked, crime rates and unattractive living, commuting, and working conditions lead to the deterioration of an area, its buildings and its property values. Everybody loses.
investment, make sure it is safe for all who use it.
As we strive towards building and maintaining safer, more inclusive spaces across South Africa, real estate investments will thrive in tandem with community well-being.
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Mantsi Moiloa Director of Strategy & Consulting Cushman & Wakefield | BROLL
To make a safe real estate
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Breaking ground in & Concor Construction mixed-use development
By Editorial
While many construction projects backed by TUHF entail funding a development entrepreneur for a small to medium construction project, that is not always the case. The partnership between TUHF and Concor Construction for funding two and possibly more developments in the Conradie Park precinct in the Western Cape is a fine example of this.
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grand style: TUHF unleash mega at Conradie Park
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ogether the companies are bringing to life two developments in the broader Conradie Park precinct, billed as one of the Western Cape Government’s seven game changer projects, and part of the Provincial Strategy to redress spatial apartheid planning.
Mark Schonrock, the Development Executive at Concor Construction, explains that the company has an extensive record of developing large scale developments in South Africa, and had its eye on constructing a mega-development in the Western Cape for quite some time. When the vacant land parcel, which the Province had been looking to unlock for about a decade, came on the market five years ago, Concor threw its hat in the ring and successfully secured the winning bid.
The result today is the establishment of Conradie Park, a residentially led mixed use development, encompassing social housing, First Home Finance housing, open market residential apartments, commercial and retail developments and even a creche that currently caters to 65 children plus two affordable private schools.
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Concor the construction company and Own Haven the developers of Conradie Park were also the proud winners of the Social Housing developer so the year award at the recent Reside Conference
Schonrock explains that TUHF is currently providing development finance supporting the establishment of two of these residential blocks – Kings Blockhouse and Silvermine – which are both four story apartment blocks for sale to the open market, with 149 apartments and 80 apartments respectively.
When complete in November 2023, Kings Blockhouse will offer 55 bachelor units (29 square metres), 57 one-bedrooms (42 square metres) and 37 two- bedrooms (55 square metres). The smaller of the two developments, Silvermine, which is due for completion in August 2023, will boast 31 studio apartments, 45 one- bedrooms and 4 twobedrooms, ranging in size from 29 square metres and 41 square metres to 53 square metres respectively.
Together, the buildings will deliver 229 new residential units to
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families and young professionals in the Conradie Park precinct, with apartments in both blocks being close to 100% sold at present. As will be the case throughout the precinct, there will be fibre Wi-Fi available throughout, and residents will be able to avail themselves of a laundry, school, a 22 000 square metre park where visitors and residents will be able to run or walk their dogs, and ample other services such as a hair salon and convenience shopping centre.
In terms of sustainability, all units have low-flow taps and double flush toilets, while lighting is catered for through energy efficient LED technology. In the likely event of power outages, there
are generators to power the larger blocks and UPS's for the smaller ones. However, a solar panel solution will be implemented into the buildings further into the Conradie Park development through Concor Construction's renewable energies division.
Schonrock stresses that as Conradie Park is envisioned as being a multi-functional precinct, open to all, the already completed blocks as well as Kings Blockhouse and Silvermine, and future developments, are not going to be run in the same fashion as exclusive gated communities, which the City of Cape Town is moving away from. Rather, security is achieved through passive monitoring, using license
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plate recognition cameras, and security guards at the precincts' three access points.
“We kept strategic ground floor locations for specific retail offerings, so at night when residents are in their units, those ground-floor retailers will bring in street activity, which builds in a sense of security as well,” he adds.
With a development of this magnitude, the challenges are equally as broad. In particular, unlocking the potential of Conradie Park, and of any building projects done within the precinct, required a significant capital outlay to address traffic access, water supply, sewer and bulk electrical reticulation.
“Before we started on the site, we did a massive bulk infrastructure upgrade to all the surrounding roads. We built new pedestrian bridges and upgraded all the traffic intersections in the area to prepare for the future residential, commercial and retail elements. That was always a concern of the surrounding communities,” he explains.
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permanent residents, traffic from their home to the CBD, work and Cape Town surrounds has been a careful consideration as part of the development rezoning process.
However, Schonrock stresses that should not be a problem, as Mutual Station is just 400 metres away and caters to both the northern and the central line. There is also easy access to taxis that leave from the station, along with Golden Arrow busses. Furthermore, Concor Construction is currently in discussions with MyCiti to bring one of its feeder routes closer to the development as soon as possible.
ABOUT TUHF THE FINANCIERS
TUHF Limited is a commercial property in the urban areas of large metropolitans targeted business model.
Our key objective is to be a good business South Africa which includes inner cities, transformation objectives. Our financial urban areas, who understand these areas contribute to urban regeneration.
Given that when complete, Conradie Park is slated to accommodate around 3 500
Over the last 20-years, TUHF has provided areas of South Africa, totalling over R7 so, supported hundreds of successful sustainable residential rental businesses.
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One of the most noteworthy features of the new developments is not wholly quantifiable but it is no less valuable. Due to the collaboration between TUHF, Concor Construction, Western Cape Provincial government, and National Government at large, a budding community is already beginning to emerge, on where once stood just an under-utilised, vacant tract of land.
“It is truly remarkable for TUHF to be involved with a project of this nature in a year where we are celebrating 20 years of seeing potential where others don’t. The Conradie Park precinct
development is a typical example of yet another successful public-private partnership that demonstrates how the private sector can collaborate with developers and Government in redeveloping large tracts of land, thereby increasing revenues for the fiscus, and stimulate local economic development. The precinct is testament to how affordable housing has evolved, and we are proud to be collaborating with Concor on this exciting journey,” says Velda Derrocks, Regional Manager for the Cape Region.
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financier that provides specialised financial services and solutions to our clients across South Africa, based on the Group’s in-depth market knowledge and
- doing good by empowering entrepreneurs to transform the urban areas of in-cites and townships. Everything we do is underpinned by our inclusive growth and services and solutions are purposely designed to finance property entrepreneurs in and have a strong appetite to grow their property portfolios, generate wealth, and
finance for affordable residential rental properties in all major metropolitan billion and encompassing 46,374 units since our inception in 2003 - and in doing property entrepreneurs in achieving their commercial property goals by running
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Open page 120 in the magazine →www.rethavanrooyen.com
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Unlocking refunds: South Africans investing in Australian
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PAGE
Rising above the UK housing shortage: How shared accommodation emerges as a solution
TRENDING ONLINE
Tech, data and AI hold solutions to the residential property market
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Unlocking refunds: investing in Australian reclaim duty and land inoperative taxes
By Editorial
Australian land is viewed as an attractive investment for South Africans. However, the investment opportunity is not without its costs, including specialised additional taxes for foreign purchasers. The impost of additional taxes in the form of higher rates of stamp duty and land tax for foreign purchasers of residential property (and primary production land in Tasmania) and absentee owners of property is discriminatory and inconsistent with Australia’s double tax agreements (DTAs).
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South Africans real estate may tax paid due to
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T
his inconsistency has led to one state, New South Wales (NSW) offering refunds for certain duty and land tax paid by foreign purchasers from eight specified countries, including South Africa. There may be opportunities for further refunds beyond the announced measures by NSW, as Johnson Winter Slattery Tax Partners Kathryn Bertram and Annemarie Wilmore explain.
Higher rates of duty and land tax for foreign purchasers In 2015, Victoria was the first Australian state to introduce higher rates of duty and land tax for foreign purchasers of residential property and absentee owners of property. The surcharges were introduced to address perceived distortions created by increasing foreign ownership of Victorian real estate. The measures were expected to “assist in adjusting the increasing inequity in the local housing market and in order to promote a fairer tax system.” 1
Other Australian states soon introduced similar charges and today foreign surcharge purchaser duty (FSPD) and surcharge land tax (SLT) are imposed on foreign owners in most Australian states. “Since 2015, surcharge rates have more than doubled in some jurisdictions, and foreign surcharges
Hansard, Legislative Assembly of the Parliament of Victoria, State Taxation Acts Amendment Bill 2015 (Mr Pallas), 7 May 2015, p 1444 2 Note the name of the duty or land tax charge varies between jurisdictions
1
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have earned state governments significant revenue” explains Bertram. For example, in the 2021-22 year, the Victorian government collected revenue of $160.19 million because of 2,177 transactions in relation to FSPD 3 and 3,013 transactions resulted in revenue of $165.78m from SLT. 4
FSPD is imposed on certain foreign persons (individuals, companies, and trusts) who acquire residential land in Victoria, NSW, Queensland, South Australia, Tasmania, and Western Australia and for acquisitions of primary production land in Tasmania. The surcharge rate per state varies between 1.5% - 8% depending on the type of land as summarised in the table below.
SLT is imposed in Victoria, NSW, Queensland, Tasmania, and the ACT. In some states it is only imposed in relation to residential land (NSW, ACT) and in other jurisdictions it is broader than residential land (Victoria, Queensland and Tasmania). The SLT is imposed at rates of between 0.75% - 4%.
Revenue NSW announcement On 21 February 2023, Revenue NSW announced that it had determined that the FSPD provisions in the Duties Act 1997 (NSW) and the SLT provisions in the Land Tax Act 1956 (NSW) were inconsistent with Australia’s DTAs entered into by the Commonwealth government with 4 countries - South Africa, Germany, New Zealand and Finland. It determined that persons who had paid FSPD or SLT on the basis that they were from one of those four jurisdictions, may be eligible for a refund of such duty or tax paid since 1 July 2021.
On 29 May 2023, Revenue NSW extended this announcement, determining that Australia’s DTAs with four additional jurisdictions – Japan, Norway, India, and Switzerland were also inconsistent with the imposition of foreign surcharges. As a result of this announcement, individuals (and potentially non-individuals) were advised that they were no longer required to pay these surcharges and could be entitled to a refund for FSPD or SLT already paid.
State Revenue Office of Victoria, Foreign purchaser additional duty statistics – downloaded 29 June 2023 - https:// www.sro.vic.gov.au/foreign-purchaser-additional-duty-statistics 4 State Revenue Office of Victoria, Absentee owner surcharge statistics – downloaded 29 June 2023 - https://www.sro. vic.gov.au/absentee-owner-surcharge-statistics
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Revenue NSW also extended the refund period for all taxpayers from the originally announced date of 1 July 2021 to 1 January 2021.
that the non-discrimination provision applies to ‘taxes of every kind and description’ imposed by Australia – relevantly this includes land tax
Discrimination and the DTAs DTAs are agreements signed by two countries designed to alleviate double taxation.
and stamp duty. Accordingly, the imposition of FSPD or SLT on foreign owners is inconsistent with the non-discrimination clause because they impose a more burdensome tax than that which is charged to Australian citizens.
Each of Australia’s DTAs with the eight countries contains a non-discrimination clause. The non-discrimination clause provides that nationals of one country shall not be subjected in Australia to any tax which is more burdensome than that imposed on an Australian resident.
The DTA entered into between Australia and South Africa provides
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Section 109 of the Australian Constitution states that when a law of a State is inconsistent with a law of the Commonwealth, the latter shall prevail, and the former shall, to the extent of the inconsistency, be invalid. This means that FSPD and SLT are invalid to the extent of any such inconsistency.
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Other Australian jurisdictions In response to Revenue NSW’s announcement, the Victorian State Revenue Office announced that it has not changed its position with respect to FSPD or SLT payable by foreign nationals in Victoria and would continue to impose these charges on nationals from the impacted countries. No other States have made a public announcement since Revenue NSW’s announcement.
“It is important to understand that while each state has separate legislative regimes in relation to
land tax and duty, they all operate broadly in the same way. We see no practical difference between NSW and the other states in relation to the non-discrimination clauses in the eight DTAs” notes Wilmore.
To date, the Queensland Revenue Office has not made any public announcements about this matter.
Determining your eligibility South African investors who have acquired or own certain property in Australia and have paid FSPD or SLT may be eligible for the
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refund of these surcharges paid historically. Such persons may be exempt from the imposition of future foreign surcharges.
Imposition of FSPD and SLT by each state or territory government
Kathryn Bertram and Annemarie Wilmore are Tax Partners at Johnson Winter Slattery, a national commercial law firm in Australia. They can assist investors to determine whether they may be eligible for a refund or to make a claim, including for the period prior to 1 January 2021 in NSW and in other states.
Australian jurisdictions imposing foreign surcharges and type of land the charges apply to.
Rates of foreign surcharge duty
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State
Foreign surcharge purchaser duty
Surcharge land tax
Victoria
8%
2% 4% (from 1 January 2024)
NSW
8%
4%
Queensland
7%
2%
SA
7%
Tasmania
Residential (8%) and primary production (1.5%)
2%
ACT
0.75%
WA
7%
NT
JULY/AUG 2023 SA Real Estate Investor Magazine
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Annemarie Wilmore Partner Johnson Winter Slattery
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Kathryn Bertram Partner Johnson Winter Slattery
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Rising above the UK How shared accommodation as a solution
By Dean Parata
When it comes to moving to a new city, town or just looking for a change in housing, shared accommodation, or living in a House of Multiple Occupancies (HMO’s), is an excellent alternative.
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housing shortage: emerges
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S
hared accommodation is where two or more unrelated people live in the same property with private access to their own bedroom and sharing facilities such as kitchens and bathrooms. There are options for groups of friends to live together or move in with people they don’t know yet, it all depends on the circumstances.
Why would a tenant choose an HMO over a private flat? The UK has been in a housing crisis for many decades. Centre for Cities claims that today, Britain has a backlog of 4.3 million homes that are missing from the national housing market. They were never built. This has been a key factor behind the UK’s inflated property prices and soaring rental rates.
With rent increasing in the private housing market, it is usually cheaper to live in a HMO than it is to live in a flat. Tenants pay for their accommodation by the room. Prices can range from £350 - £750 depending on the size, location, aesthetics, tenancy flexibility, whether they have their own private bathroom and if bills are included.
Household energy bills increased by 54% in April 2022. Tenants in
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a shared house are able to divide those costs amongst themself reducing their monthly outgoings. If the same tenant was to live in a flat, all the running costs would fall on them. Since Covid the cost of living has soared across all sectors which has resulted in renters looking to tighten the belt and save every penny. More and more landlords are offering a bills included service as it removes the stress
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from tenants around co-ordinating bills and managing and price increases.
What if a tenant wants to live in a flat? Oasis Living found the average price for a one bed flat is at an eye watering £850 a month (excluding London). If a tenant then had to factor in the price of utilities, water, sewerage, broadband, council tax and ground rent they could be looking at in excess of £1300.
Luckily, there have been lifestyle changes, especially amongst Gen Z and Millennials where the focus has shifted from getting married and starting a family in their early twenties to enjoying brunches and building successful careers. The under 35 age group are now more than ever choosing the HMO alternative as it fits perfectly with their lifestyle and budget plans.
Here at Parata Property we understand all of these factors along with many more ENQUIRE NOW demonstrate the high demand for shared accommodation and provide great investment potential. Which is why every week we search the market to bring you exclusive HMO property deals that Dean Parata you can add to your Director property portfolio. Parata Property
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Meet Jacques Groenewald: Journey of a Passionate
By Editorial
In the world of real estate, exceptional service is rooted in personal relationships and a deep understanding of the community. Today, we introduce you to Jacques Groenewald, a seasoned iAgent at Meridian Realty who embodies these principles.
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The Inspiring iAgent
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H
aving spent over 28 fruitful years in real estate, Jacques embarked on his journey with Meridian Realty, a decision that significantly shaped his career. His passion for helping people navigate their property journeys and his love for the Belville community, where he primarily operates, makes him an integral part of Meridian Realty's award-winning team.
"I always enjoyed working with people and solving problems," Jacques recalls of his initial foray into the industry. "Becoming a real estate agent was more than a job for me, it was a fulfilling career path that allowed me to independently shape my success." Jacques is a firm believer in honest communication, swift problemsolving, and the power of personal relationships. "My clients trust me because they really know me, and I believe that maintaining that trust is my responsibility. I take a proactive role in ensuring their property sales are successful," he says. This approach is deeply rooted in his mantra: "No excuses, only results".
Jacques chose to become an iAgent at Meridian Realty for the independence it provided. He relished the idea of being an
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independent agent, working under the umbrella of a well-established brand. "Meridian Realty provided the best of both worlds - the freedom to navigate my own business and the support of a professional, understanding team," he notes. The support offered by Meridian Realty was indeed a game-changer for Jacques. He appreciates the access to an array of professional services, from photography to marketing, enabling him to maintain his personal brand while delivering high-quality service to his clients.
The blend of professional elevation and personal branding that Meridian Realty provides, combined with the ability to work from anywhere, continually inspires him in his daily endeavours. Being deeply involved in his community and understanding its evolution over the years gives Jacques an edge in his profession. “Having spent most of my life living and specialising as a property practitioner in Belville, I have seen this area evolve tremendously and I love being part of this community. I am proud to contribute to its development through my work with Meridian Realty”, he shares.
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Jacques was particularly impressed by the company's remarkable personalised approach to his marketing needs when he first joined Meridian Realty as an iAgent. The team's exceptional promptness and efficiency in delivering their services astonished him. He appreciates their deep understanding of his unique requirements, and that they execute each task flawlessly. From his outstanding car branding and personalised signs to professional photoshoots and bespoke marketing material, Jacques acknowledges the team's utmost professionalism in handling every aspect of his marketing endeavours.
Even amidst his busy schedule, Jacques always finds time for his loved ones as he is a dedicated family man. In “Team Groenewald” he works closely with his wife, who he has been married to for many years, as well as his daughter, who is also part of the Meridian Realty family. When he is not connecting with his clients, busy with local roadshows and elevating his personal brand on social media he loves a good cappuccino or two while visiting local coffee shops. Being an iAgent gives Jacques the freedom to spend time doing
everything he loves.
Jacques's journey with Meridian Realty is a testament to the company's commitment to its agents, offering exceptional support and opportunities for personal and professional growth. He serves as an inspiration to those considering a career as an iAgent. As Jacques says, "With Meridian Realty, I have the freedom I need, the support I appreciate, and the success I work for." If you're considering a career in real estate, why not follow in Jacques's footsteps and become part of the Meridian Realty family?
Join our award-winning team today at www.meridianiagent.co.za and experience a world of opportunity, just like Jacques did.
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Look out for our next issue in August/September 2023