Real Estate Investor Magazine
August 2023 edition: full text
Every page of the August 2023 issue as text. To see a page as it was designed, open it in the magazine.
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AUGUST/SEPTEMBER 2023
OFFICE OWNERSHIP
RETIREMENT PROPERTY
INVESTING IN SOLAR
THE BIGGEST LIE IN PROPERTY
Unveiling the long-term advantages of owning your workspace
Illuminating the decision: Is solar still a wise investment?
5 Convincing reasons to jumpstart your investment now
Debunked: The truth behind property ownership myths
WEALTH MASTERS CLUB
Unveiling Coert Coetzee's distinctive property investment strategies
Elevated expertise. Elevated results.
With innovative, sustainable Commercial Property Finance solutions, we are future-proofing the African continent by empowering our clients to expand their businesses.
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Corporate and Investment Banking
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D
The biggest lie in real estate investing and embracing investment truths
ear Investors and property enthusiasts
Welcome to the latest edition of Real Estate Investor magazine (REIM), where we embark on a journey to unlock the potential of real estate investing in the year 2023.
We live in a dynamic landscape where change is the only constant, and the real estate market is no exception. As we
reflect on the recent past, it's evident that the property investment sector has faced its share of challenges in the years since the pandemic, and in 2021 and 2022. The landscape was shaped by rising interest rates, escalating living costs, and a rollercoaster of economic fluctuations, prompting many investors to adopt a cautious stance and await more favourable circumstances.
The narrative, however, is now changing, and the stage is set for a potential renaissance in real estate investment. Our cover story on Coert Coetzee explores unique unconventional property investment methods we need to explore more carefully in these times.
One of the key messages in this issue is the spotlight on property rights for all South Africans. We delve into the FW de Klerk Foundation's recent conference on this critical topic, exploring how responsible property ownership could pave the way for a surge in investment and buying activity. The interplay between legislation, regulation, and equitable access to property rights becomes a crucial theme as we consider the potential impact on the investment landscape.
The 'biggest lie in property' is that when you buy a property
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you own it, which is a myth we want to challenge. It does not matter if you have a mortgage bond on the property or if you own it outright bond free, it still challenges conventional wisdom. Either way your local government, province and municipality are still your landlords sparking a fresh perspective on the realities of property ownership.
Understand you are merely a custodian of the property and as a landlord your responsibility is to ensure that the property is maintained properly, kept safe and habitable. It must be maintained in an optimum condition otherwise the value deteriorates. This includes safety checks, electrical compliance, asset repairs, waterproofing, rodent and pest control, painting, cleaning, and gardening to name a few. To do that you need financial and human resources which is normally unaccounted for by most property owners.
To be able to make to get the most out of your property by ensuring it is managed effectively to get the best possible return for your equity to be tied up into it. As an investor you need to inherently understand those added responsibilities and factor them into your investment methods.
Here at REIM we still say that in 2023 is the year that we could ignite a resurgence in real estate investing.
A parallel to the past: Drawing parallels to the property boom that ignited in 2001 and thrived until 2006, 2023 appears poised to revitalise the market. A similar trajectory could bring about substantial gains for investors.
benefit from escalating property values and heightened rental demand across the board and particularly in the short-term rental market.
Strategic timing: Those who acquired properties during the market trough and maintained a long-term perspective have reaped substantial rewards over the years. 2023 may start to replicate such opportunities.
Job creation and economic boost: An uptick in job creation especially in the Western Cape, despite challenges like inflation and loadshedding, infuses more disposable income into the economy, fostering property investment.
Market resilience: Properties priced below the average, around R1.3 million, and lower, continue to yield favourable returns due to robust demand surpassing supply.
Flexible interest rates: With interest rates likely reaching their peak, opting for variable interest rates instead of fixed ones can maximise homeowners’ potential to capitalise on rate drops.
As we navigate this exciting landscape, remember that the best time to invest is influenced by various factors that are unique to your circumstances.
Wishing you prosperity and success in your investment ventures.
NEALE PETERSEN FOUNDER & EDITOR-IN-CHIEF
Capitalising on existing assets: Many property owners seek ways to optimise their current holdings and look for more opportunities.
Investor advantage: Those with existing investment properties are poised to
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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
FRONT COVER IMAGE: Coert Coetzee
CONTRIBUTORS
Dominique dHotman Marc Roper Jaco Grobbelaar Gabriel Botha Gil Sperling Shanaaz Tretheway Bonga Ntuli Neil Berberg Sophie Gamborg FW de Klerk Foundation
Digital Designer
Heather Spangenberg design@rei.co.za
Accounts Manager
Marisa George marisa@rei.co.za
CIRCULATION
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PUBLISHERS
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
JUNE/AUG 2023 #158
TRENDING
003 Editorial View 017 Coert Coetzee 029 Company Profile 135 From humble beginnings to Industry Leader: Unveiling Vuyolwethu Badi's remarkable journey in Quantity Surveying.
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INVESTING
041 Seizing the Opportunity: Why Property Investment Should Be a Priority in Your Financial Journey
FINANCE
049 Navigating turbulent times: How financial institutions can provide relief for bond repayments
041
WEALTH
059 Unlocking time’s potential: A primer on the time value of money essentials 067 Property Rights for ALL South Africans: Paving the path to equitable ownership
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059
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TECHNOLOGY
079 Unlock the power of Smart Connections: Enhance online Marketplaces buyers & sellers 085 Pioneering leadership: A Trailblazing force in software innovation and Authentication Technology
101 Reviving South Africa’s water quality: 5 Effective strategies to act now! 111 Inospace ventures into e-commerce logistics leveraging off its traditional offering 117 Office ownership in Cape Town City Bowl: Unravelling the business sense and long-term advantages of owning your own workspace
OFFSHORE
125 Retirement Visas: South Africans now eligible in more countries - Mauritius tops list & property purchase not required 131 UK Property Market achieves 43 years of positive growth - Birmingham rental market surges by over 40% in just 3 years
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RETIREMENT
141 Secure your future: 5 Compelling reasons to invest early in retirement properties
079
COMMERCIAL
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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
Investing in solar power in your property, is it still a good idea?
DOMINIQUE DHOTMAN Head of Solar - ooba
I
am still not sure if it is a good idea to invest in solar power in my property today, as when loadshedding subsides it does feel as if things are starting to getting resolved and that Eskom can be fixed but also I am still not sure when or even if they know. It is also very expensive exercise and I need advice on what the real benefits will be for me as a property owner and if it really justifies the cost?
O
ur ability to remain optimistic in the face of extreme adversity is one of the things that makes us as South Africans extraordinary, it is however, time to be pragmatic. There’s no denying that the solar power comes at a hefty price tag, but this investment provides immediate lifestyle return and financial peace-of-mind in the long run. It has been 16 years since the energy crisis first began, so it’s crucial that South Africans take power
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into their own hands by investing in alternative energy sources.
Eskom first began implementing ongoing power cuts, locally known as ‘loadshedding’ in November 2007. The country experienced a six-year reprieve before loadshedding made its dreaded return in 2014, with sporadic blackouts until March 2021 when it started again in earnest.
The root cause of the energy crisis lies in ageing infrastructure, mismanaged funds intended for upkeep and a failure to add additional generating capacity to power plants in the early 2000s under President Mbeki’s regime, despite dire warnings from Eskom management.
Using figures from EskomSePush and the Council for Scientific and Industrial Research's (CSIR) Energy Centre, we have experienced an estimated 7,777 hours of
Q&A
loadshedding from 2021 to May 2023. Every one of those hours translates to the inability to cook a hot meal, lost productivity, and in the worst cases – threatens the physical health and safety of the most vulnerable groups in our country – the sick and the elderly.
As a nation, we are incredibly resourceful and the majority of South Africans have simply adapted their lives around the loadshedding schedule: cooking at different times, charging devices during electricity windows, buying candles, and investing in devices that keep certain appliances on without power. But
the fact remains that these hours without power are hours we can never get back and that we have no real guarantee of when loadshedding will end - if it ever will.
What will it take to fix Eskom? When it comes to ‘solar resistance’, we often hear the comment ‘it’s not worth investing in a solar power system now because loadshedding will be sorted out in the next year or two. While nothing would make me happier than a sooner-thanexpected end to loadshedding, this statement does not consider: 1. What it will take to fix the problem and
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ASK THE EXPERTS
2. That the benefits of solar power are not limited to not being just affected by loadshedding.
Addressing the first point, Eskom board chairperson Mpho Makwana has previously stated that it will take between 18 months to two years to end loadshedding and that they hope to have an energy availability factor of 70% by March 2025.
Experts within Eskom and industry insiders have however repeatedly said that fixing loadshedding completely would require significant investment in the grid such as infrastructure upgrades and the building of new generation capacity.
It would also require improved governance and transparent decision making. As an example, to the mismatch in timing expectations, it takes seven years from the time a new substation project is identified until the building of that substation can begin; this because of all the required permitting, bulk planning and regulatory processes required. If it takes seven years to add one substation, how will we remove loadshedding in the next year or two?
energy sources such as solar, wind and hydropower to reduce our dependence on coal and create a more resilient energy generation system. This does however require significant investment in the Eskom grid and transmission infrastructure, which is not a quick thing to turn around. Again, by way of example, in the most recent IPP bid window, 6 MW of renewables were ready to be added to the grid but only o1 was approved given grid capacity constraints.
While these measures can make a difference, there is no ‘quick fix’ to out loadshedding woes. Consumers should also anticipate paying even higher electricity costs as the country bears the financial burden of getting Eskom back on track.
Benefits of solar power that take loadshedding out of the equation.
A positive development, however, comes in the form of the City of Cape Town’s effort to build grid resilience by encouraging Independent Power Producers (IPP). City officials have recently spearheaded a project to compensate IPP’s who generate excess energy. Any business that has solar panels on its roof can be compensated for generating excess electricity and selling it back to the city.
Another solution would be for the government to invest in renewable
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Q&A
Those who wish to ‘wait it out’, have the option of a ‘rent-to-own’ solution rather than purchasing the entire system outright. I stress that investing in solar power offers financial and lifestyle benefits that go beyond an uninterrupted power supply: 1. Lowered operating costs. Solar systems offer a relatively low operating and maintenance cost once installed. Regular cleaning and occasional maintenance are typically all that's required to keep them running efficiently. Solar panels also have a lifespan of up to 25 years. 2. Reduced electricity bills By generating electricity from solar panels, users can offset their reliance on grid electricity. This can result in significant savings on electricity bills - especially over the long-term.
3. Claim tax rebates The 2023 Budget Speech announced that individuals can claim a rebate of 25% of the cost of solar panels, up to a maximum of R15 000. 4. Increase the resale value of your home.
Depending on the existing value of your property, solar could increase the value of a property by up to 8% and help it to sell up to 20% faster.
Finally, for green-minded individuals, investing in solar power is an excellent way to reduce your carbon footprint and embrace sustainability.
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Demystifying FICA, the essential items, and its requirements for property transactions
MARC ROPER Senior Compliance Officer - DOCFOX
W
hat is FICA and why is it so important, and what are the essential FICA items for property transactions and also what systems are best?
F
ICA is the Financial Intelligence Act that came into effect in July 2003, along with the establishment of the Financial Intelligence Centre (FIC). The FIC is responsible for overseeing compliance with the Act. FICA aims to combat financial crimes such as money laundering, tax evasion, and terrorist financing. As an Accountable Institution, it is your responsibility to identify and verify your clients and ensure that their information is correct and up to date. FICA has been amended and is now known as the Financial Intelligence Centre Amendment Act 1 of 2017 (FICAA), which brings South Africa closer to international anti-money laundering standards.
Under the FIC Act property practitioners (estate agents) are specifically mentioned by name as being ‘reportable institutions’ with various obligations with regard to FICA with responsibility around identification of their clients as well as having their own risk management and compliance programmes. Estate agents must be able to verify and
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identify their clients. They also need to keep records of their clients while still being POPIA (Protection of Personal Information Act) compliant.
The estate agency business for example must appoint a Compliance Officer, and register themselves with the FIC (Financial Intelligence Centre). It must also create its own risk and compliance programme and train its employees and agents on it. Estate agents are also obliged to report all transactions which meet the reporting threshold and those which appear to be suspect in nature.
Why FICA is Important? As a member of the Financial Action Task Force (FATF), South Africa has agreed to play a role in the international fight against money laundering and terrorist financing. FICA is South Africa's local legislation to achieve this. FICA complements other South African legislation such as the Prevention of Organised Crime Act (POCA), the Protection of Constitutional Democracy Against Terrorism Related Activities Act (POCDATARA), and the Prevention and Combating of Corrupt Activities Act (PRECCA). Together, these legislations introduce measures to combat and prosecute crimes such as organised gangs, racketeering, terrorist-related activities, and money laundering.
FICA's Impact Since the establishment of the FIC and the onset of FICA, impressive strides have been made to combat money laundering and other financial crimes in South Africa. The FIC has assisted in many financial crime investigations, including bringing an estimated R12 billion Ponzi scheme to a halt, exposing an import/export ring, and exposing a case of theft and money laundering to the value of about R21 million. Based on these and other findings, it is clear that the processes and legislation enforced by the FIC do work and have a positive impact on working towards ending financial crime and protecting innocent businesses from unknowingly facilitating crimes.
The FICA requirements pertaining to verifying property clients apply across the board, from sellers and buyers to landlords and tenants. The property practitioner will request clients to provide them with proof of identity and proof of residence. Other documents that they
can provide to assist in making sure their transactions proceed timeously are documents from SARS confirming their tax number and documents confirming their marriage status such as a marriage certificate if applicable.
Accountable Institutions that fail to comply with their FICA obligations may open themselves up to a range of consequences, including administrative sanctions, sizable fines, or even prison sentences.
Making FICA Simple and Seamless To ensure compliance, systems like DocFox ensure that your compliance process is hassle-free and automated. DocFox automatically assists with remote, digital, and automated document collection and analysis, configured risk rating, automated client reviews, and daily anti-money laundering watchlist screenings and adverse media screenings. This helps you determine your clients' risk profile and identify possible ongoing threats.
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COVER STORY
Empowering financial Education & Property
By Neale Petersen
Wealth Masters Club (WMC) now one of the oldest, biggest and most successful investor clubs in SA and the world has more than 750,000 members worldwide was created as a support system for entrepreneurs and investors by Founder and CEO Coert Coetzee in 1996.
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COERT COETZEE
success through Investment
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COVER STORY
P
roperty investment is a core ingredient for investor members of the Wealth Masters Club as that is where some of the best return on investment (ROI) is made. If you are a business owner and/or a property investor, you will understand the challenges of building a company or portfolio from scratch through the long hours, sleepless nights, worry about collecting rent, making payroll, managing cash flows and the general stress of running a business.
The stats of running a successful business in South Africa are low and there is high chance of failure. Economic downturns, recessions and other outside forces can conspire to bring down even the most successful companies. Coert’s business changed forever when he discovered the power of using a trust within his business structures.
The right business structures can not only protect your company from natural disasters the pandemic and recessions but also from threats like loadshedding, riots, financial distress, and any other disaster that many businesses face in a crisis. It can also assist you to take advantage of tax incentives and deductions that you normally
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can’t do and pay tax legally through SA Revenue Service approved methods. It equates to more money and resources to invest back into your business.
In the world of financial education and investment mentorship, Coert Coetzee stands out as a prominent figure, known for his contributions to guiding individuals towards achieving financial success. As the founder of Wealth Masters Club, Coert has dedicated himself to providing valuable insights, tools, and strategies to help people navigate the complexities of wealth creation and investment.
COERT COETZEE
Q AND A WITH COERT COETZEE
1. What inspired you enter to the property industry? I bought my first house in 1986, did some renovations, then sold it and made a 100% profit. At that point in my life I thought I had found the best way to create money. The bug had bitten me, and I started doing this repeatedly. It was only later in my life, after reading an article about the Duke of Westminster that I realised I had been doing it wrong this whole time, and I was selling opportunity.
That is when I discovered the ‘holy grail’ of property investment – using specialised Trusts for property investment, and the art of refinancing. That is when I started to see the real value that property can bring, and my life had changed forever.
2. Where did your journey to success start? What were the key milestones or challenges you faced along the way? I was always naturally an entrepreneur with several businesses over the years. I even owned Beauty Cube, a group of 13 Beauty Parlours, in my thirties.
In 1990 that I started Profcover, an insurance brokerage, and grew it in four years to one of the top 5 independent brokerages in South Africa. At this point I thought I wanted to retire and travel the world, but I soon realised that retirement was actually quite boring for me. That was when I discovered the secrets of the Duke of Westminster in an article that featured in the ‘Huisgenoot’, SA’s biggest Afrikaans weekly magazine. So I started researching it a little more, and what I learned changed my life, and the lives of many others, forever.
It was in 1996 that I registered the first version of the Wealth Mastery System in South Africa, and now thanks to that system, we have the biggest property investor club in South Africa. I have been invited to speak all over the world with the likes of Robert Kiyosaki the investor entrepreneur and author of the best-selling personal financial book in the world ‘Rich Dad Poor Dad’.
All of my friends started to notice that my life had changed and that I was buying properties all the time, and they all wanted to know how and why.
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COVER STORY
My wife, Vanessa, eventually convinced me to get everyone into a room together and tell them all the story of how I did it, and that is how the Wealth Masters Club was born back in 2003. The rest, as they say, is history.
3. What unique strategies or approaches have you implemented to differentiate from your competitors? I noticed very soon that talking the talk is one thing, but walking the walk is another. The biggest problem I noticed with other speakers who were trying to change people’s lives was that they do not have the right team to support them and their product.
I saw a gap and decided that I wanted to create a full service offering by having a team of expert service providers who can ‘walk the walk’. I now have the honour of heading up a legal practice, an accounting firm, a property agency, and a host of other supporting companies who help our clients through every step of the way in their wealth creation journey. Our group now consist of 23 companies, all with a specific goal of helping members of our club to create, protect and grow their assets and wealth.
4. Can you share a specific project or initiative you consider a turning point in your career? What lessons did you learn from it? It was quite simple, when my wife showed me an article about the Duke of Westminster which indicated he was the richest man in the world (richer than Bill Gates or anyone else at the time) it got my interest. They estimated that conservatively, he was 100 times richer than Bill Gates at the time. I spent a lot of time researching to understand how and why, and that’s where I discovered that he was the sole heir to a Property Trust that spanned 19 generations.
It was at this point that I decided to make it my life’s mission to find out and understand how they did it and how we could do the same here in South Africa with
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COERT COETZEE
our unique laws and regulations. I spent months working with the top legal and trust experts in the country to develop our first ‘Double Trust Structure’ which is a crucial part of the Famous Wealth Mastery System. Many people have asked me what makes our trusts unique, and it is all to do with the wording we use and the clauses that we have developed over the years.
5. How do you stay updated on industry trends and ensure your business remains innovative and adaptable? I am fortunate to be surrounded by very clever people who are all experts in their fields. They are constantly reviewing changes in the property industry, laws and regulations and adapting our model.
6. What is your leadership philosophy, and how do you foster a positive and productive work environment within your organisation? It is very simple. Find people who can do things better than yourself and then allow them to do it!
7. Have you faced any significant setbacks and challenges in your career? How did you overcome them, and what did you take away? Yes, in 1994, in my middle thirties, at the height of my Profcover success I suffered a heart attack. Thereafter my life changed completely. Up to that point I always thought I was the best, but because of my health I was forced to rely more on my managers. That was when I discovered that, with the right guidance, some other people can do some things better than me.
At first, I was forced to use other people skills, but very soon I was preferring other people’s skills. I learned that by using Other People’s Skills (OPS), Other People’s Time you can just achieve so much more. In 1996 I also learned the power of using the bank’s money, Other People’s Money (OPM). Now, by using OPS, OPT and OPM to the maximum, I can afford to ‘travel the world and smell the roses’ while back home my businesses are just growing bigger and bigger!
8. How do you approach risk-taking and decision-making within your business? Can you share an example where a calculated risk paid off?
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COVER STORY
Profcover was one of the biggest independent Risk Management companies in South Africa. It was obvious that my background as a Risk Manager by profession stood me in good stead as a successful property investor. Combine that now with my passion for property and trusts and you’ll find a very lucrative combination.
Many people know me as ‘Mr Fearless’ because I’m not afraid of creditors, high interest rates and other ‘negative’ things that could negatively impact my business. I’m not afraid to use the bank’s money to the maximum. I invest big when others are afraid of investing, and I am counter cyclical in my strategy. For some people recessions are devastating, for me it’s the best time to grow my portfolio!
I’m not reckless or foolish in my investment strategy. I only invest in things that I understand inherently and in things that I believe in. For example, prime investments for me are entry level townhouses in security complexes. They are low risk with high rewards. However, I must warn you that it will only work if you strictly follow the Wealth Mastery System which is also the Ultimate Risk Management tool which has worked wonders for me.
When interest rates shot up to 25.5% in 1998 my friends and I used this Wealth Mastery System, and we bought multiple properties at auctions that were bank owned ‘sale in execution’ properties… for almost next to nothing!
When property values dropped with 0.4% in 2009, it was a buyer’s market paradise for me and for the members of our club.
9. In what ways do you prioritise corporate social responsibility and sustainable practices within your organisation? ‘Social responsibility’ is a huge part of the way we make our profits legally 100% tax-free with our System. As tax money gets stolen by our corrupt governments official, it never reaches the poor. Therefore, we created our own beneficiary charity program called South African National Taxpayers Union (SANTU).
With the help of some top legal brains, entrepreneurs and a brilliant cognitive psychologist, we discovered that if a certain set of laws are applied in a certain way and sequence, we can add enormous value to our
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COERT COETZEE
country's cities, towns and, subsequently, to our private properties. In short, we are now going to fix South Africa!
SANTU stands as a properly constituted non-profit organisation which will legally take over the receivable rates & taxes and the duties of any non-performing municipality or state entity.
The system has already been tested by our researchers in several court cases since 2019, which they all won. Thanks to that, we now also have proven case law to strengthen the set of laws we use.
We already started with a few municipalities in the above mentioned cases and now we are ready to roll it out to every city, suburb and town in South Africa. You can attend our seminars to find out more about this new system.
10. What role do you see technology playing in the future of your industry, and how are you preparing for it? Our industry, residential property, is a basic need of all human beings and if property investment is done strictly according to the Wealth Mastery System, like the duke, we have a very bright future!
After 400 years, and 19 generations later, the Duke of Westminster is still one of the biggest property owners in England.
11. How do you envision the future of your industry, and what steps are you taking to stay ahead of emerging trends? Over saturation of areas is the biggest danger. Stay away from areas like that.
12. What legacy would you like to leave in the world? The Wealth Mastery System!
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COVER STORY
Coert's journey into the world of finance and education was fuelled by a strong desire to bridge the gap between theoretical knowledge and practical application. Recognising that many individuals lacked the proper financial education to make informed decisions, Coert embarked on a mission to empower them through knowledge sharing.
Education as the Cornerstone At the heart of Coert's approach is the belief that education is the cornerstone of successful wealth creation. Wealth Masters Club offers a range of educational resources, including workshops, seminars, online courses, and mentorship programs. Coert emphasizes the importance of understanding financial concepts, investment strategies, risk management, and market trends before making any financial decisions. By demystifying complex financial concepts, Coert enables individuals to take control of their financial destinies.
Holistic Approach to Wealth Creation Coert's philosophy extends beyond traditional investment
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strategies. He advocates for a holistic approach to wealth creation that encompasses not only financial well-being but also personal growth and happiness. This approach acknowledges that true wealth is not solely measured in monetary terms but also in one's overall quality of life. Coert encourages individuals to set clear financial goals, develop healthy financial habits, and cultivate a mindset that promotes long-term success.
Mentorship and Community Wealth Masters Club is not just an educational platform; it's a community of like-minded individuals seeking financial empowerment. Coetzee's mentorship programs provide participants with direct access to his expertise and experience.
Through personalized guidance and support, Coert helps individuals navigate challenges, make informed decisions, and stay motivated on their financial journeys. The sense of community within Wealth Masters Club allows members to share insights, learn from each other's experiences, and collectively work towards their goals.
COERT COETZEE
Adapting to Changing Landscapes. Coert ensures that Wealth Masters Club's resources are relevant and up-to-date, providing members with the tools they need to navigate evolving financial environments.
Coert's impact on the world of financial education and investment mentorship is undeniable. Through Wealth Masters Club, he has created a platform that empowers individuals with the
knowledge and skills needed to achieve financial success. Coert's emphasis on education, holistic wealth creation, mentorship, and community has resonated with countless individuals seeking to secure their financial futures. As a visionary leader, Coert continues to inspire and guide those who aspire to take control of their financial destinies.
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Learn how to make
with TOWNHOUSES and REFINANCING
WEALTH MASTERS CLUB
Wealth Masters Club to helping individuals their dreams of financial
Wealth Masters Club (WMC) is a wealth coaching company dedicated to helping individuals to achieve their dreams of financial freedom. Whether you want to get the most out of your retirement plan, build your personal wealth, become a top investor, or build a strong property investment portfolio, WMC will show you how.
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COMPANY PROFILE
dedicated achieve freedom
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WEALTH MASTERS CLUB
T
he Wealth Mastery System is a titan among Investor Clubs. Since our establishment in 1996, we have grown to become one of the oldest, largest, and most triumphant communities in the world.
With a staggering global membership of over 750,000 individuals, we have repeatedly proven that our strategies are unmatched in their effectiveness.
This is not just another run-of-the -mill Wealth Creation training platform; it is a life-altering expedition that equips you with the tools necessary to forge everlasting financial freedom. It is a once-in-a-lifetime opportunity for every South African, investor, and business owner who dares to dream big, break boundaries, and create a legacy that will transcend generations.
WMC Products and Services WMC offers in-person & online courses, training, newsletters, and books that enables individuals to create wealth and financial freedom. WMC specialty products and services include: • Investment Education • Wealth Coaching • Trustee and Legal Services • Trust and Business Accounting • Property Sales • Specialised Trust set-up and administration
WMC Secret Formula Several WMC methods have been
Wealth Masters Club (WMC) is proudly associated with the esteemed Destinata Group of Companies and Treasury Trust Services. We operate throughout South Africa, delivering exceptional services to our valued members.
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COMPANY PROFILE
used by the wealthy for centuries and is not taught in schools and universities. The average accountant and financial advisor do not properly understand how these methods work.
The WMC fool proof Wealth Creation System never fails in structuring one’s life and lifestyle. For example, using the WMC secret formula, if you invest or build a new entry-level townhouse, SARS will give you up to 100% of the costs back?
Properties are purchased only with
the banks money and paid for by tenants. Tenants are managed by ‘no-nonsense’ property rental managers. These properties are also kept in a specialised trust structure to ensure that all income and capital gains tax generated on the properties are 100% tax free.
Estate Planning Mastery Estate planning is a complex and sensitive topic and is indeed an important aspect of financial management, and it's essential to ensure that one's assets and loved ones are taken care of in the event of death. The specifics can
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WEALTH MASTERS CLUB
vary depending on jurisdiction, family circumstances, and personal preferences. There are a number of challenges and issues that can arise in estate planning and management, particularly in the context of South Africa.
33
up by ignorant Financial Services Providers (FSP).
Working with professionals who specialize in estate planning can provide you with the guidance you need to make informed decisions and safeguard the financial wellbeing of your loved ones.
The typical example of average claimants on an estate on death of a family member are mostly; married in community of property, have children who are dependent on getting an inheritance, have no control or access to immediate funding normally ending in dire situation for family members that have not set-up the correct structures.
The disastrous management of deceased estates by the state after death of a loved one in South Africa is a frequent recurrence for average people mostly signed
Example of a typical situation on death of a family member normally takes place as follows: 1. The estate is immediately frozen
AUG/SEPT 2023 SA Real Estate Investor Magazine
COMPANY PROFILE
2. Bank accounts are frozen, with no access to cash whatsoever 3. The Government’s Guardian Fund can take away your minor children 4. The Executor of the estate (mostly a FSP) will wind up the estate irrespective of any will and/or testament that is in place 5. The Executor sells and auctions all your assets & more than 50% of the value of the assets are lost
6. Creditors are all paid up first, leaving a pittance for the family members
Estate costs also start racking up: • Estate Duty - 25% to SARS on the estate's nett value • Capital Gains Tax - 18% to SARS • Executor Fees - 4% of estate's gross value to bank or insurance company • Auctioneers Commission - 10% • Transfer Duty - 13% on luxury houses
WMC CASE STUDY
Let's imagine two individuals attending our day-long seminar, both receiving the same message. They're both eager to organise their affairs and invest in property. • Person A schedules a consultation with our Wealth Officer, addressing their concerns and creating a solid plan going forward. • Person B, however, discusses the seminar learnings with friends who offer their advice without fully grasping the context, of what was presented in detail fuelling Person B's initial fear. • To those in the "Person B" category, consider this: How many investment properties do your friends own? Are their affairs arranged to ensure their family's well-being after they're gone? If the answer is no, that's where the issue lies. • Damien attended his first Wealth Mastery Seminar at 16 with his parents. Afterwards, he was like Person A, excited for his parents to act on the knowledge, knowing it would yield long-term benefits. • Unfortunately, they did not act and rather followed their friends' advice, leading to financial difficulties • He also had fears before embracing this Wealth Mastery system. What if it fails? What if he selected the wrong property? What if
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WEALTH MASTERS CLUB
•
•
•
the trust regulations change? The list of worries were long. Starting was scary, but seeing his parents struggle transformed his fear of starting into a fear of not starting. I saw the first-hand the results of listening to the advice of friends. In WMC events, Coert Coetzee founder of WMC often asks attendees about their hesitations, which largely mirror around their past fears: 1. Fear of the unknown. 2. Fear of being unable to afford property investment. Despite these fears, Damien now enjoys a more than 450% return from one of his properties, thanks to a skilled WMC team.
As humans, our main challenge is our fear of the unknown. We tend to dwell on ‘what if’ scenarios and come up with countless reasons why something might not succeed. Another issue is seeking advice from the wrong sources.
Wealth Mastery System The Wealth Mastery System is the only legal way to avoid taxes and costs to settle an estate.
Importance of Estate Planning: Estate planning involves planning for the distribution of your assets and the care of your dependents after your passing. It typically involves creating a will, setting up trusts, designating beneficiaries for retirement accounts and insurance policies, and more.
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COMPANY PROFILE
Frozen Estate and Bank Accounts: When a person passes away, their estate is often frozen to allow for proper legal processes to take place. This can lead to challenges in accessing funds, which is why it's important to have a financial plan and structure in place that includes provisions for immediate expenses and access to funds for surviving family members.
Guardian Fund and Children: The mention of the Government's Guardian Fund taking custody of minor children is a concerning issue. It's generally a good practice for parents to appoint legal guardians for their children in their wills to ensure their well-being and proper care.
Executor and Will: It's important
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to carefully select an executor for your estate, someone who will carry out the wishes outlined in your will. If there's a conflict of interest or potential for mismanagement, this can lead to complications.
Asset Distribution and Debt: The process of settling an estate can involve the sale of assets to cover debts and liabilities. It's crucial to set up a structure to ensure as smooth transfer of your assets and liabilities, and if possible, plan for the payment of debts in a way that minimizes the impact on your loved ones.
Estate Costs: The costs associated with settling an estate, such as estate duty, capital gains tax, executor fees, and others, can indeed add up. This is why comprehensive estate planning, including strategies to minimize tax liabilities, can be beneficial.
The Solution -TTS Trust You can circumvent all death costs, such as estate duty, executor fees and VAT payable on assets acquired. This means that your spouse and children can inherit everything and not just the meagre remains of a deceased estate.
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Working with a professional estate planning attorney can help ensure your will is properly executed. It’s important to note that only a living Treasury Trust Services Trust (TTS Trust) can take care of the living.
"The best time to plant a tree was 20 years ago, the second best time is now." OLD CHINESE PROVERB
Property Investment the foundation of Wealth Mastery Property investment is one of the core investment vehicles that is used in the WMC. Believe it or not, there are challenges hindering wealth creation here in property investment in South Africa if it is not done correctly.
UBER is the largest taxi company in the world, even though they don't own any cars! Airbnb is the biggest hotel company in the world, yet they don't own any properties. WMC, with its thousands of houses, can eventually become the largest buy-to-let residential property investment group in the world without owning any houses.
If you're a true Wealth Master, you will not own a single thing in your personal name - not even your clothes, and certainly not your ‘buy-to-let’ houses. And if you have structured it correctly, and have followed the correct methods, it means you cannot ever lose your wealth!
All properties are registered in a specialised TTS Trust where you can create multiple streams of income for yourself and your family.
Why act now? Coert Coetzee, founder & CEO of Wealth Masters Club often hears this question from individuals interested in property investment or setting up trusts.
An old Chinese proverb provides the perfect answer: "The best time to plant a tree was 20 years ago, the second best time is now."
Key takeaway Leverage the WM club's benefits. Instead of seeking advice from friends connect with the right experts for proper guidance – WMC network of service providers is here for you. Plus, as a club member, consultations are all
complimentary.
If you've yet to take action, now's the time. With only a few seminars left this year, limited space remains. Take the leap, secure your spot, and receive sound advice from experts.
Life is short. Don't wait 20 years, wishing you'd taken that leap of faith when you read this article. Start now!
How to become a WMC Member By joining our exclusive INVESTOR CLUB, est.1996, you are investing in yourself. You will get access to the ancient secrets and methods of the real
New Family Memberships are exclusively available to anyone who attends our full-day in-person. Seminar in a city near you. If you are unable to attend, we have various free short webinar trainings available or click on the enquire now button below.
ENQUIRE NOW
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THE GREAT STUDENT
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Seizing the Opportunity: Why Property Investment Should Be a Priority in Your Financial Journey
TRENDING ONLINE
Demystifying the myths: Debunking 8 common misconceptions about homebuying & property investment
Resurgence in Cape Town CBD: Residential Property sector on the rebound
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INVESTING
Seizing the Opportunity: Investment Should Be Financial Journey
Discover the indispensable in building a prosperous
By Jaco Grobbelaar
Property investment offers endless opportunities to unlock financial freedom. In our ever-changing world, this time-tested avenue is still one of the best ways to secure wealth and build prosperity.
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PROPERTY
Why Property a Priority in Your
role of property investment tomorrow
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INVESTING
O
ver the years, we’ve seen that property or real estate investment is one of the most effective investments due to its stability, reliability, and diversity. If you’re ready to delve into the world of property investment and discover how it can pave the way to a brighter financial tomorrow, read on.
Some naysayers believe you cannot make high returns through property investment, but the proof is in the pudding, as they say. Property investment actually yields much higher returns than other investments, and property investors have the potential to earn billions!
“Make a study of the rich. The rich either made their wealth, or kept their wealth in real estate.” DOLF DE ROOS
Below, we’ve shared our top 3 reasons why you should invest in property and why we believe you are wasting
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your time if you aren’t investing in property. Of course, there are many more reasons, but discovering them for yourself is half the fun, and we’re no spoilsport!
01
Reason #1:
Property shows consistent growth
Even when the real estate market is slow, it is still growing. You can’t say that about many other investments. And this is not only a local
ACCESS BONDS
trend; it’s global! What I love about property investment is that it offers investors two returns.
You have capital appreciation (capital growth) on the one side and rental income that the property generates on the other.
Capital Appreciation Property has the potential to appreciate in value over time, allowing you to
build wealth through capital appreciation. While property values can fluctuate, historically, real estate has shown steady long-term growth, especially in desirable locations.
In South Africa, property prices declined in only three years over the last 50 years, and if you take any 20-year moving average, capital appreciation (capital growth) was about 10% a year. This is much higher than the growth we are currently seeing!
Rental Income Generation Properties can generate income through rental income. Investing in rental properties or commercial real estate can provide a steady cash flow stream, making it particularly attractive for investors seeking passive income or a stable source of funds during retirement.
To measure the returns generated
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INVESTING
from rental income, we use the Net Rental Yield formula. It considers the annual rental income minus all the property expenses (excluding debt services like mortgage payments) as a percentage of the property’s purchase price or market value. To get a complete picture of your unleveraged returns on a property, make sure to add your capital appreciation to the Net Rental Yield.
02
Reason #2:
The Power of leverage to grow your property empire
Leverage is simply borrowing and using other people’s money (OPM) to finance a portion of a property’s purchase price or fund renovations and improvements. Whether from a bank or private investor, leverage can turn low returns into high returns!
Property is one of the best investments to leverage because of its stable growth characteristics and ability to keep its value well. With property, it is also possible to finance up to 100% of the property through the bank. This means that you can acquire assets and build your asset base without putting any (or very little) of your own money down.
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03
Reason #3:
Property Investment provides low-risk, passive income
When we tell people to invest in property, their eyes tend to go WIDE! But the truth is that investing in property provides investors with low risk and relatively passive income.
Property is a long-term investment and will always be in demand; therefore, it’s low risk. Investing in property also provides diversification for your investment portfolio. It adds an asset class with a different risk and return profile than traditional investments like stocks and bonds. Diversification helps reduce overall portfolio risk by spreading it across multiple investments. And you’re winning all the way…
If you buy intelligently, property investment also provides passive income streams through rental income, property appreciation, and long-term growth potential. Whether you outsource your property management tasks or do it yourself, you can enjoy the benefits of passive income without extensive effort with property investment.
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An added bonus is that property can effectively hedge against inflation. As the cost of living increases, so do rental prices and property values. Real estate investments have historically performed well during inflationary periods, providing a potential safeguard for maintaining the purchasing power of your investment.
Embrace enduring potential of Property investment for longterm success Whether you’re a seasoned investor looking to diversify your assets or a first-time buyer eager to embark on a growth journey, property investment is more than just a venture — it’s a powerful tool for achieving long-term success. So, stop wasting your time and start investing in property today!
ENQUIRE NOW
Jaco Grobbelaar Managing Director Prosperity Enterprises
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FINANCE
Navigating turbulent times: How financial institutions can provide relief for bond repayments
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A step-by step guide: Mastering capital gains tax calculation when selling your home
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FINANCE
Navigating turbulent financial institutions for bond repayments
By Editorial
Purchasing a property is a significant financial commitment that requires careful planning and long-term dedication. When taking out a bond or mortgage, potential property owners and homeowners agree to repay the borrowed amount with interest over a specific period. Managing bond repayments is crucial for maintaining a good credit score, building equity, and achieving future financial goals.
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BOND REPAYMENT RELIEF
times: How can provide relief
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FINANCE
H
owever, economic uncertainties and unforeseen circumstances can make it challenging for homeowners to meet their bond instalments on time. In such times, financial institutions can step in to offer assistance and support.
Antonie Goosen, Principal and Owner of Meridian Realty, emphasizes the importance of being well-informed when it comes to finance options while buying a home. He suggests consulting with estate agents, bond originators, or financial service providers to make realistic and attainable goals.
Considering the finance options available, potential homeowners can benefit from using bond calculators provided by major banks and bond originators. These online tools help estimate monthly instalments, interest rates, loan terms, and other associated costs, enabling individuals to make informed financial decisions.
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Additionally, making extra payments above the minimum instalment required by the bond can help reduce the outstanding balance, lower interest costs, and shorten the loan term. While all five major banks allow clients to make extra payments, it's essential to be aware of any potential penalties or fees.
BOND REPAYMENT RELIEF
Goosen says when selecting the type of interest rate for their bonds, clients can choose between variable and fixed interest rates. A variable interest rate changes with the South African Reserve Bank's repo rate, while a fixed interest rate remains the same for a specified period. The best option depends on the client's personal situation and risk profile.
“Moreover, most bond agreements include built-in credit insurance, which can help cover bond repayments during difficult times such as job loss, illness, or divorce. Potential homeowners should ensure they have access to
credit insurance when taking out a mortgage.
“Given the economic turbulence in South Africa, many individuals face difficulties in paying their bond instalments on time or in full. In such situations, Antonie Goosen advises homeowners not to ignore the problem but to contact their banks promptly and explain their situation. Financial institutions can offer various options to ease the financial burden and avoid defaulting on bond repayments and home repossession,” says Goosen.
Six Options available to assist Distressed Bondholders:
1. Payment Holiday is a temporary suspension of bond repayments to overcome a loss of income or unexpected expenses. 2. Debt Restructuring involves modifying the loan terms, such as extending the repayment period or lowering instalment amounts, to make it more affordable. 3. Reduced interest Rate may be offered to clients with a good credit history and who meet specific criteria. 4. Debt Review is a legal process that helps over-indebted consumers restructure their
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FINANCE
debt into a manageable repayment plan. While under debt review, clients are protected from legal action and harassment from creditors, but they cannot apply for new credit until the debt is cleared. 5. Debt Counselling: A debt councillor negotiates with creditors on the client's behalf, proposing a new payment plan with reduced monthly instalments and interest rates. 6. Credit Life Insurance: Credit life insurance covers debt repayments in the event of death, disability, illness, or retrenchment. Homeowners can claim from insurance if they are unable to pay bond repayments due to any of these reasons.
Financial institutions in South Africa are aware of the challenges faced by distressed bondholders. Many banks offer specific programmes or solutions, such as dedicated debt care centres, home loan payment relief centres, bank-assisted sales programmes for properties, and debt review and debt counselling services.
Goosen advises homeowners to carefully consider all available options and plan for the worst-
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case scenario. He emphasizes the importance of taking out necessary insurance, mindful spending, and seeking consultation with professionals when purchasing a home.
“In these difficult economic times, financial institutions play a crucial role in providing support and relief to clients facing bond repayment challenges. Offering financial assistance over an extended period can help homeowners maintain their good standing and avoid adverse credit scores, benefiting all parties involved,” concludes Goosen.
BOND REPAYMENT RELIEF
ENQUIRE NOW
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WEALTH
59
PAGE
Unlocking time’s potential: A primer on the time value of money essentials
67
PAGE
Property Rights for ALL South Africans: Paving the path to equitable ownership
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Why do we need to invest?
SA Real Estate Investor Magazine AUG/SEPT 2023
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WEALTH
Unlocking time’s time value of money
By Gabriel Botha
Tick, tock, tick, tock! Time flies when you're having fun, but did you know that time can also make your money grow? That's right! Welcome to the exciting world of the time value of money, where we'll explore how time, risk, inflation, and opportunity costs play a significant role in shaping our financial future. So, let's explore the basics of this monetary phenomenon.
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TIME'S POTENTIAL
potential: A primer on the essentials
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WEALTH
T
he basics of the time value of money Before we dive into the nitty-gritty, let's understand the basics. The time value of money is a fundamental principle in finance that states that money available today is worth more than the same amount in the future. But why is that? Well, it's because of three essential factors: risk, inflation, and opportunity costs. Let's take a closer look at each of these aspects and discover if time is your financial friend or foe.
Risk: The leap of faith Risk encapsulates the uncertainty of the future. By having money today, you avoid the risk of not receiving it in the future. There are plenty of investment options in this world, each with a different risk level. To compensate for this risk, you may demand an extra sum, called interest, to be added to the loan. This interest rewards you for taking on risk and provides a buffer for potential losses.
In the world of investments, the higher the risk, the greater the potential return you may demand to take on that risk.
Your investment risk level should
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be aligned with your goals, but to get the balance from the time value of money you shouldn’t take on so much risk that you lose your capital or too little risk that you don't achieve your investment goals. Remember, it's all about balancing the risk and the reward to increase your wealth!
TIME'S POTENTIAL
Defining investment terms As we mentioned, the more risk you take the longer your investment term should be. Hence by investing for a specific term you control your risk and give yourself a higher probability of achieving your investment goal. The below terms are an indication of when an investment will be
required. For example, in an emergency, your emergency fund investment should be available within 3 days, or if you are saving up for a vehicle in 4 years, then medium-term investing would be relevant for you. • Emergency: 0 to 3 days • Short-term: 0 to 2 years • Medium-term: 2 to 5 years • Long-term: 5+ years
‘Don’t underestimate the power of compounding. It’s the secret sauce that makes the time value of money so magical.’ SUZE ORMAN
Inflation: The sneaky thief Ah, inflation! It’s the thief that erodes the purchasing power of money over time. Picture yourself walking into a Pick ’n Pay with R100 in your pocket. You find your favourite
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WEALTH
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TIME'S POTENTIAL
chocolate bar priced at R15, but when you return a year later, the same chocolate bar now costs R17. What happened? Inflation stole some of the value of your money!
different choice. Let's say you have R50 000, and you're contemplating investing it in the stock market. However, you can also spend it on vacation in a tropical paradise.
Inflation is the general increase in prices over time. It means that the same amount of money will buy you fewer goods and services in the future. To protect your wealth from the ravages of inflation, you need your money to grow at a rate higher than the inflation rate. This is where investing comes into play, helping your money keep pace with – or even surpass - inflation. Inflation, or the loss of purchasing power, also brings with it the illusion of wealth. Many topics around the braai would be about a house being sold for R2m when it was bought for R800 000 a few years back. Keep in mind that if the growth did not keep pace with inflation, the storyteller did not make any money at all.
If you decide to invest in the stock market, the opportunity cost is the loss of the experiences, memories, and relaxation you would have enjoyed on that vacation. On the other hand, if you choose the vacation, the opportunity cost becomes the potential gains you could have earned from your investment. It's all about weighing the pros and cons and making decisions that align with your goals and priorities.
Opportunity costs: The dilemma of choices Opportunity knocks, but only once! The concept of opportunity costs reminds us that by choosing one course of action, we sacrifice the potential benefits we could have gained from making a
Delaying when you start investing is also an opportunity cost, as money can only grow by investing. The sooner you start investing, the more you'll be rewarded. Have a look at this calculator as proof.
Basic Math of the time value of money The basics of the time value of money have five inputs. You will generally have four of these inputs and are looking for the fifth. The five inputs of time value of money are: 1. PMT (Payment) - Are you
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WEALTH
making a payment towards something? 2. I (Interest Rate) - What is the interest rate? 3. N (Time) - What is the timeframe? 4. PV (Present Value) - What is the present value of the payment? 5. FV (Future Value) - What is the future value of the payment?
What can you use the time value of money for As you can see, there are plenty of uses for the time value of money, ranging from personal finance (here are free calculators for you to download), retirement planning, investment planning, and many more. For now, just do some examples and ensure you understand the basics of the time value of money.
EXAMPLE 1: SAVING FOR A VACATION
Let's say you want to go on a dream vacation in two years, and you estimate that you will need R50 000 (FV) for the trip. You decide to start saving money monthly in a savings account with an annual interest rate of 9%. The monthly payment (PMT) you can afford to set aside for savings is R3 000. Now, you want to determine the future value (FV) of your savings in two years.
Inputs: • PMT (Payment) = R3000 pm • I (Interest rate) = 9% (expressed as a decimal, 0.09) • N (Time) = 2 years but use 24 months (N needs to align with your payment. If monthly, use months here.) • PV (Present value) = R0 (assuming you haven't started saving yet)
To find FV (Future Value), you can use a financial calculator or a spreadsheet function. In this case, the future value of your savings after two years would be approximately R78 565.41. It looks like you're going on holiday!
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TIME'S POTENTIAL
EXAMPLE 2: CALCULATING LOAN REPAYMENT
Let's say you want to borrow R50 000 from a bank. The loan carries an annual interest rate of 11%, and you want to determine how much you should repay monthly to repay the loan in three years.
Inputs: • FV (Future Value) = 0 (You want the loan balance to be 0 in three years) • I (Interest Rate) = 11% (expressed as a decimal, 0.11) • N (Time) = 3 years or 36 months (N needs to align with your payment. If monthly, use months here.) • PV (Present Value) = R50 000
To find PMT (Payment), hit the PMT button after inserting the other inputs, and you’ll see the monthly payment required to repay the loan in three years at 11% is R1 636.94 a month.
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Gabriel Botha Business Development Manager Prescient Investment Management
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PROPERTY RIGHTS
Property Rights for ALL Paving the path to
By Editorial
In July 2023, the FW de Klerk Foundation, supported by the Konrad Adenauer Foundation (KAS), hosted a conference on the topic of property rights at the Bryanston Country Club in Johannesburg. The event provided a valuable reference work for the future of South Africa and property rights for all.
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WEALTH
South Africans: equitable ownership
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K
arl Marx said that the definition of communism is very simple: it is the abolition of private property. The ANC, in its Strategy and Tactics document, says that property ownership and relations are at the centre of all social systems. Many other commentators have held that one cannot have a free and successful society without property rights.
Part 1 of the conference looked at ways and means of extending property rights to all South Africans, while the afternoon’s session focused on ways of defending these rights, particularly in light of the threat posed by the Expropriation Bill, which is about to be signed into law.
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WEALTH
Chris Endres, Project Manager – Konrad Adenauer Foundation
He opened the day by sharing his insights from a German perspective. “It is clear that property rights underpinned the social market economy, which transformed the German economy and society after the second world war - and is the reason why Germany is seen as a role model for prosperity, social stability and economic success,” he began.
He went on to explain that: “Certainty of ownership is, in our view, an important component of human dignity in and of itself. It encourages us to work and invest in the just expectation that we will earn the rewards of our efforts. And as a consequence, it protects our identity as a being that creates.
More prosaically, property rights are also there to support human dignity in more secondary terms. Property rights are a necessary but not sufficient condition for economic growth, through which rising incomes improve living standards. Property rights are not unlimited, however, there is no place in the world where property rights are protected in an unbounded fashion. Wherever there is a state, property rights are bounded. A balance has to be struck between economic growth and the social context and safeguarding of the common good - and the specific context matters.
He continued that, within a South African context: “In South Africa, property rights are not a clinical subject dispassionately viewed. Different ideas of property have been at the burning heart of South Africa’s historical tension. Apartheid’s fixed racial categories live on in the current government’s perspectives on
‘Property rights can never be the right of a privileged few - it should be a right that we as a nation should afford to all citizens.” ELITA DE KLERK, FW DEKLERK FOUNDATION
PROPERTY RIGHTS
property, and it serves as a cover for a status approach to economic management at best, and exploitative plutocracy at worst. The effect is that property rights in South Africa are a potent weapon of political discourse, and this may drive economists like myself that pursue efficiency to absolute distraction.
The evidence as presented today is not sufficient, especially on this topic in South Africa. A balanced property rights regime has to be provided in such a way in South Africa that people can identify with it, and understand why the legislative proposals of the current government damage the human dignity that is equal for all of us. Today’s conference on property rights is part of an emotionally charged political debate that will define South Africa’s ability to become a better country, and this is a significant responsibility for all of us to bear.”
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David Ansara, CEO - Free Market Foundation
He presented Title Deeds for Disadvantaged Homeowners: “As the Free Market Foundation, we are very proud to showcase the Khaya Lam project. This is a project that has been going for 10 years, and in that time we have very proudly transferred over 10 000 title deeds to former council tenants - people who have been residing on properties for sometimes generations, but have lacked the former legal recognition of their ownership status.
We work together with donors, with municipalities, with a team of conveyancers, and also with the beneficiaries themselves to help get title deeds into the hands of South Africans.”
WEALTH
Amy Barclay, Head of the Land Centre of Excellence, Agri SA
She explored the question of How to Make Land Reform Work for All. “We’ve looked at our past, we’ve looked at our failings, we’ve really looked at the challenges we’ve faced, and the bottom line is: we need money to achieve a big goal - finance is critical, and we need the collaboration and cooperation of every South African - whether it be the individual farmer, the worker on the ground, the state - everybody needs to work together in one single united direction in legislative policy that is cohesive so that we can achieve our goals, because thus far we’ve really not achieved the land reform targets that we’ve set,” she shared.
Hernando de Soto, worldrenowned Peruvian economist
He offered direct insights on Unlocking the Wealth in the Property of the Poor.
Dave Steward, FW de Klerk Foundation Chairman
He has been speaking to De Soto about the challenges of inequality, unemployment and the need for land reform in South Africa, and seeking his advice on how he has dealt with similar issues - not only in Peru, but around the world.
A key takeaway from the interview was De Soto’s assertion of the absolute need for consultation with the people involved in the historical processes of land reform: “When we started our reforms, we built a system of popular feedback - which means that we knew that making any worthwhile reform was
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going to be polarising. We found that the stabilising factor was getting people’s opinions, and we established a system of popular consultation that actually went to the World Bank afterwards.
The idea is that, with every reform you’re going to make, you want, one way or another, to find out from the bottom, what people think of it. There’s no agenda - you simply get the complaints, and you’ll find that a lot of the information that’s necessary for a reasonable solution will come from the people themselves.” His presentation
Phumlani Majozi, Senior Fellow at African Liberty
focused on The Centrality of Property Rights for all Successful Societies. “I strongly believe that - for societies to thrive, to grow competitive, to make a positive impact for their people, they have to be centred around property rights. And it’s very important that the property rights are protected by the framework and the laws that are being put together by the Government.
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If I own property, I must have a right to ownership of the property so that I am able to utilise it for whatever means. It’s a very important topic that South Africans need to reflect on and approach with a sense of purpose and drive to make change - we need to transform our society to one which is centred on the protection of property rights, which are critical for economic development,” he asserted.
Prof Fernando Spiritto, Professor of Public Politics at the Catholic University, Andres Bello in Caracas, Venezuela.
Speaking about the Venezuelan experience of the erosion of property rights, he said that the Venezuelan economy had shrunk by 75% since its socialist revolution and seven million Venezuelans had left the country
“The Venezuelan case shows that the rules in place matter. The policies are important if we want to achieve a collective goal such as economic growth. The challenge is to find a way in which everybody - especially the Government -
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respects the rules of democracy,” he shared.
Expropriation Bill expert, Dr Anthea Jeffery, Head of Policy Research at the Institute for Race Relations
She offered her analysis of the Bill, its origins, and its implications. “The Expropriation Bill will enable the Government to expropriate land - and many other kinds of property - generally for inadequate compensation, significantly below market value. It will also allow the government to expropriate land - at times for no compensation, and this is likely to have very negative consequences for all South Africans, because property rights are really vital to investment, growth, employment, and prosperity.
There’s also a further risk with the Bill that it will allow custodial takings - in other words, that the Government - rather than having to expropriate one piece of property after another - will, by the stroke of a legislative pen, be able to take custodianship of vast amounts of land, and the people living there - as farm owners, home owners, factory owners - will have to lease from the Government,
and may lose their leases in wideranging circumstances, too.
So there will be huge uncertainty about being able to do business, about being able to reside in your own home, which will be extremely negative for the country and all its people. We need to recognise that property rights are the key to prosperity, to investment, and to the kind of better life that all South Africans would like to see.”
Dr Theo de Jager, Executive Director of SAAI
He presented Implications of the Expropriation Bill for Agriculture and Food Security: “This whole conference was actually about threats to ownership, to private property rights. From a farmer’s perspective, to have a title, to have secure ownership is much more than just a contract which shows that you own property - it’s the very foundation of a free market, it’s the cornerstone of capital. It is the reason why we have access to production loans, it serves as collateral.
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We looked at all these countries north of us - 50 of them on the African continent - that do not have free hold of farmland, which is the reason why we cannot unlock the wealth of agriculture on this continent. And we drew all these pointers back home to say, what should we do differently here? How must we make sure that the threats to property rights do not also become a threat to food security?”
Dawie Roodt, Director and Chief Economist of the Efficient Group,
He highlighted the Economic and Investment Implications of the Expropriation Bill: “I’m quite concerned about the next couple of years in South Africa - we’ve got a government that has caused immense damage to the South African economy. If they expropriate, they can do other things as well, and I’m concerned that eventually this could lead to the kind of totalitarian state in South Africa.
It’s not only a matter of stealing
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property, it’s a matter of stealing people’s lives, stealing people’s freedoms. I think we’re in a period of political transition - the next five years or so are going to be very difficult. Remember, there are many kinds of expropriation. I believe that inflation will become a significant problem in South Africa - that is a form of expropriation. I also believe that tax is a form of expropriation - I think we’re going to see more of that as well, because the fiscal accounts have become completely unsustainable.
Fortunately, I think this is the thing about democracy - it’s only going to last another five years or so, then we will have another opportunity to get rid of an incompetent and quite often corrupt government.”
Dave Steward reiterated that: “Virtually all the problems discussed at the conference have their roots in the fact that the Government - for almost 30 years - has been following an ideology that is profoundly at odds with the Constitution with which we all agreed. FW de Klerk said in a speech on 31 January 2014 that non-ANC parties had signed off on the values, rights and institutions that are articulated in the Constitution. They had
WEALTH
not signed off on the National Democratic Revolution and they do not accept it.
Elita de Klerk, FW de Klerk Foundation Vice-Chairperson
The sense from all the panelists and speakers of this event is that we must say no to things that are not acceptable. For us in the NGO sector, for businesses and for all South Africans - the time has come to say no, we do not accept this.”
“Everyone should enjoy the right to own a property - a piece of land for their cultural, housing or industrial purposes through the means of a title deed that secures that right. Once the right is secured, the owner can use it to create wealth for his or her family. Without that right, ownership of land or a house remains uncertain.
Our Constitution is clear - no law may permit arbitrary deprivation of property. Herein lies a very clear constitutional obligation - expand property rights, and protect
property rights. Any attempt to dilute the property rights of citizens on the basis of race would erode the rights to human dignity, equality, non-racialism and protection under the rule of law. If handled properly, land reform could be the most positive development since 1994. However, if handled badly, on the basis of expropriation without compensation, it would be a catastrophe for all South Africans. It will deter foreign investment, amongst other things.
As the FW de Klerk Foundation, we wish to confirm our commitment to advocate on behalf of millions of people in South Africa who do not enjoy the right to own property over which a title deed is registered, and that this right be expanded, strengthened and protected. Property rights can never be the rights of a privileged few - it should be a right that we as a nation should afford to all citizens.
Source: FW de Klerk Foundation; KA Foundation
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TECHNOLOGY
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Unlock the power of Smart Connections: Enhance online Marketplaces buyers & sellers.
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Pioneering leadership: A Trailblazing force in software innovation and Authentication Technology
TRENDING ONLINE
Tech, data and AI hold solutions to the residential property market
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Unlock the power of Enhance online buyers & sellers.
Key Insights from GOM Conference
By Gil Sperling
Connecting buyers and sellers in more effective, efficient, and content-rich ways is a key focus in the online space now, no matter the industry. Making use of rich data, retargeting audiences, and working smarter to deliver a better user experience are the keys to success, across verticals. As a tech platform that's already connecting buyers and sellers on social media, Flow is creating seamless solutions for this transformation.
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SMART CONNECTIONS
Smart Connections: Marketplaces
2023
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W
e recently visited the Global Online Marketplaces Conference 2023 in Miami to talk about off-site social ads for portals, why they need it and how it unlocks more revenue for them. The Global Online Marketplace Summit (GOM) brings together C-Level leaders from online marketplaces around the world to discuss the key issues facing their businesses and solve problems and evolve existing ways of thinking. The amazing response showed us that we are ahead of the curve in many ways.
We fundamentally believe in collaborating with other businesses in these industries to further innovate, disrupt and revolutionise the future of marketplaces. From the Global Online Marketplace Summit in Miami, we returned with four key insights.
Top 4 Insights
01
AI-led search is set to revolutionise marketplaces. ChatGPT is just the tip of the iceberg when it comes to the possibilities of AI search engine integration, especially in the marketplace,
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where it can completely change the experience of how we shop online. Currently, if you use a search engine like Google, it will sort through millions of results in seconds, surfacing the top three that are most likely exactly what you’re looking for.
Developments in AI-led search seek to further enhance this experience for users. This could mean that soon, users will be able to input a specific image of what they’re searching for and receive product listings that relate to their query.
Davor Anicic from Velebit. ai is at the forefront of these developments and during the GOM Summit, shed some light on how these advancements could be implemented in the property space. From auto-generated listing descriptions to AI valuation and dynamic pricing, these technological improvements will improve the user experience for both buyers and sellers.
02
AI or humans - who edits better? Listings with great images are proven to perform far better than those that don’t, and the
CYBERCRIME
deciding factors can come down too little things like lighting and angles. Not only can AI overcome these shortcomings, but it is also much cheaper and quicker than outsourcing your editing to a photographer or editor who may take up to 12 hours to complete a job.
Another great implementation of AI is that it can generate content to auto-stage an image. For example, if a user is looking for a home suitable for a growing family via a portal, a photograph of an empty room might present as a toy room or games room to give prospective buyers a visualisation of how their lives could look in this otherwise empty home. This query-specific content generation is a massive
game changer in the property industry.
03
Off-site social ads are in demand. From our own research and knowledge of the ad tech space, we know that our target audiences spend an average of 4 hours a day on social media apps like Facebook, Instagram and TikTok, whilst they may only spend an hour a month on portals looking for something that they want to buy. Marketplaces are looking for ways to increase traffic to their portals and present their products to audiences in the places where they spend the most time.
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Currently, most agents use multiple platforms to manage their listing pages and social media ads, with limited visibility on how successful each may be. The reach of each listing is also limited by its place on the portal’s page. If portals were to integrate an offering, much like Flow’s, users would have the ability to create, manage and track their offsite ads through one portal, leading to increased product visibility across those platforms. The reach of a social media ad far surpasses that of a single listing, improving outcomes and opportunities for sellers. Best
of all, these off-site ads could be automated, saving an agent or seller a lot of time and money.
We anticipate that the demand for this offering will increase, and soon become an expectation rather than a ‘nice to have’.
04
Next-gen-lead-gen Jonathan Turpin from AIM group brought news of how technology is being employed to bridge the gap between consumer demand
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CYBERCRIME
and the number of available agents, through “next-gen-leadgen”, a business model where marketplaces and portals share a commission with agents on products that have been sold. This means that agents don’t have to do the legwork of finding listings and finding buyers, rather the portals take on this work for a fee.
This business model has gained traction in developing markets where a large percentage of the population is growing to ‘middleclass’ and the demand for housing is high. Although there are still some hindrances to this model such as delayed payment and the portal needing a very robust tracking system, these advancements are a peek into the future of how portals may evolve their operations in specific markets or specific niches.
property space because it’s such a fragmented industry - and it works equally well in similar verticals, like automotive and financial services.
The fact remains that people are researching and shopping online for everything they need, so it makes sense to target them there. They trust what they see on their curated social media feeds and if the ads they receive are laser-focused and relevant to what they’ve been looking for, the brands who are doing that will benefit from that trust.
They’ll boost sales, improve trust, build relationships, and grow their audiences, no matter the industry.
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05
Moving into other verticals Using smart tools to connect agents, buyers and sellers and helping agents build their brands is proving successful in the property space – but the same tools can be applied to many other verticals. Our tech works in the
Gil Sperling HCo-Founder & Co-CEO Flow
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Pioneering leadership: force in software Authentication Technology
By Editorial
Shanaaz Tretheway is Chief Operating Officer for Comcorp South Africa, a leading software innovator and authentication technology specialists. She is an inspiration, not only for her leadership and organisational capabilities but also her role as a woman in the tech space.
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PIONEERING LEADERSHIP
A Trailblazing innovation and
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S
he is passionate about the role businesses play to service society through technology especially as the reliance on technology is embedded in our thinking, behaviours, and society. She shares her thoughts on women in the tech space.
did you get into the 01 How tech space?
I got into the tech space incidentally and also married a software engineer. I had a realisation that everything we do is in some way or form digitally enabled which made her believe the distinction between commercial and technical is not a useful one. We have these differentiated skills within our organisations, but tech is part of our everyday DNA – meaning that to make an impact going forward, it was to immerse myself in understanding this.
02
Why do you love your work and the tech sector?
I love my work and tech sector because it isn’t about coding – it's about how something as dynamic as human challenges are solved.
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Something that is colourful, and dynamic is converted to a solution and into binary. And that binary could become complex – but it’s empowering to introduce the nugget of value to the world.
To think we have the power to translate what we need into products – by combining what appears to be two ends of the scale is incredibly fascinating.
I love solving problems and taking complexity and making things look simple or at least feel simple. It’s a triumph of our collective intellect.
03
What is you take on the gender gap in the tech sector
I have never let this define my
own progress. I can see from the stats that there is a divide and a gap…one that is slowly being reduced. The growth and pervasive nature of tech will help reduce this. If we think it’s about sitting in a corner and spitting out zeros and ones, then I think it's going to be a niche skill set and extract very specific people – gender aside.
PIONEERING LEADERSHIP
However, the social, and interactive dynamic that tech represents today, offers everyone an opportunityacross gender, across skillsets and across socio-economic categories to play a role in defining what it looks like in the future.
04
How can women positively impact the gender gap or in general in the tech sector?
Collaboration and sharing is important and being accessible to each other. Being brave to show that perhaps a different perspective is not wrong, but rather creates a stronger solution. The
journey of any progress starts with defining what it is for you, and then working from there.
My definition of tech and platforms could be vastly different from the other. But as long as we can show how they work together, and how it makes for a better product, we can create the jobs of the future and carve out the roles that come with the uniqueness of who you identify as.
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05
What are your views and own way of doing the groundwork that future generations of women will benefit from?
Being authentic and unapologetically me. By modelling this and remaining resilient I can deliver what I can in the best way possible. There is a great deal of emphasis on what others say and what people do; a sense of social pressures that make us believe that we should look or act a certain way.
And although I fundamentally believe we should conform to certain etiquettes to enable us to work together – being anything other than yourself could mean we are enabling future generations to be a “canned” society. Creativity and problem solving comes from being authentic and learning how to make the differences between us count positively. And that includes gender.
06
How should young females view the tech sector as?
An opportunity to express problem solving, innovation towards solving some real human challenges. It’s exciting to know that something that has come
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from a mere idea can make an impact at scale - it’s incredible. It’s about being a part of something bigger, and understanding that the limit is oneself as opposed to physical strength or what you look like. In a knowledge world, there are no limits. And for this reason, it’s a place with the most opportunity to flourish.
07
What is your best advice to other women - and also may be tips on how to get into the sector? Or tips on how to grow and find their own niche.
Conformity gets you only so far, whilst authenticity takes you all the way. Listen more and be clear on how what you have to say translates to another person. In respecting others, you are respecting yourself. If faced with criticism or difficulty, I remind myself that what we do today will make tomorrow easier. And what I learn today will strengthen my tolerance and perspective tomorrow.
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PIONEERING LEADERSHIP
Shanaaz Tretheway CEO Compcorp SA
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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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Page 100
Open page 100 in the magazine →A c o ast al oasis cr afted b y n at ur e H O MES FR O M R 2 00 0 00 | LAND FROM R 460 000
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Reviving South Africa’s water quality: 5 Effective strategies to act now!
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Inospace ventures into e-commerce logistics leveraging 38 off its traditional offering
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Office ownership in Cape Town City Bowl: Unravelling 38 the business sense and longterm advantages of owning your own workspace
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Open page 102 in the magazine →COMMERCIAL
Reviving South Africa’s Effective strategies to
By Bonga Ntuli
Poor water quality in South Africa is becoming a major crisis across many municipalities in our country, putting at risk our health and economy.
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Open page 103 in the magazine →WATER QUALITY
water quality: 5 act now!
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I
n June this year, the Department of Water and Sanitation revealed — in findings of its interim Blue Drop report — that only 39% of South Africa’s water treatment systems were rated as excellent in terms of microbiological water quality compliance, 11% good, 9% poor and 41% bad. To put this into perspective, only 10% of municipalities had bad or poor microbiological water quality in the 2012 Blue Drop report, as opposed to 50% in this latest sample.
Rapid urbanisation, income growth (which results in higher demands) and increased levels of pollution in our river systems are among key reasons why South Africa is facing major challenges with its water quality. But some municipalities and districts are also running out of funds for basic operational requirements, such as chlorine, to treat contaminants in wastewater, while others lack sound management and expertise.
Compounding this problem is the fact that South Africa is a water scarce country, and more prone to shock climate change events such as extreme droughts or floods.
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5 key measures to be adopted, to turn SA’s water problem around
1
Make engineers great again
Over the years, many municipalities have started to rely more on administrators and finance managers than engineers when it comes to critical water waste management and maintenance issues.
The reasons for this are varied, with
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some municipalities seeking structural changes or cost savings.
To manage water effectively, we do need to start creating an organisational culture of putting engineers more at the centre of decision making.
These engineers must be of the highest calibre and should lead administrations on key decisions that will result in the best quality water and required sewage management for an area’s residents. Good engineers are like the doctors of our water systems.
We also need to acknowledge that South Africa faces a critical skills shortage as experienced professional engineers retire and talent migrates to other industries, such as banking. Investing in education and promoting STEM subjects at school level can help fill this talent gap.
Additionally, embracing technological advancements and exploring water management partnerships between the public and private sectors will further help to promote skill development and capacity building.
2
Reporting and consequence management
Having the right engineers in place is only one part of the solution. Another critical component is reporting and consequence management within our municipalities and districts.
With the Department of Water and Sanitation moving to republish the Blue Drop report last year (after it was paused in 2014), this marks a step in the right direction when it comes to reporting, accountability and transparency.
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It’s important to know that the Blue Drop report is not focused solely on water quality but rather with the overall management of water and waste systems. This means that some areas deemed high risk can be just a few steps away from having unsafe drinking water, while others already need to issue red notices or warnings to residents.
This provides a gauge of where underperformance is occurring. More importantly, it informs the government of where it must act swiftly.
In instances of neglect, municipal managers should face the consequences, whether it be with fines or even criminal charges. Provincial or national government also then need to step in and immediately fix problems where local government has failed.
3
Smarter use of wetlands, closing leaks
Local research has shown that wetlands can act as additional, natural water filters for our manmade water systems. This is because the plants, soils and even microbes in our wetlands can effectively absorb and uptake
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many harmful pollutants. However, this involves a delicate balance as our wetlands also need to be protected for them to protect us.
In this regard, South Africa should take a closer look at ensuring that industry should be more responsible when emitting discharge into rivers. This might require implementing stricter rules regarding the quality of water that is pumped from industrial processes into the environment.
In addition to maintaining wetlands, water leakages contribute significantly to South Africa's water challenges, with over 50% of water losses reported in some metropolitan areas.
Non-revenue water, the water lost before reaching consumers, squanders valuable resources. Effective asset management, improved maintenance
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practices, and investment in modern technology can help reduce water leaks and conserve precious water supplies.
4
Greater attention to funding, supply chains
and maintenance. Proper planning, investment in projects, and efficient financial management are crucial to ensure that resources are used optimally.
Local and provincial governments need to realise that allocating funding for water projects is a long-term investment.
Robust infrastructure development can even attract investment and boost economic growth, while providing better services to the population.
Insufficient capital and operational expenditure at the municipal level hinder infrastructure development
It’s also important to pay greater attention to supply chains of water maintenance. Purchasing higher
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quality components or investing more in repairs will go a longer way in ensuring longer term sustainability. We cannot afford to cut corners in this regard, and there must be zero-tolerance for maladministration when it comes to procurement of quality services and products.
5
Better long-term planning
Finally, bringing all this together
is better long-term planning. Our
engineers, working together with our municipal managers, need to ensure that there are longterm plans that seek to improve or maintain high quality water standards for the benefit of citizens.
These plans, such as the building out of new wastewater infrastructure, need to be sound enough that they can stretch over several years and potential changes in administrations. In this regard, we need to become more technocratic
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as a country when it comes to a precious resource such as water.
As part of this planning, the interconnection between water, energy, and food security cannot be ignored. Disruptions in one sector can have cascading effects on the others, leading to potential riots or dissatisfaction with service delivery. Energy shortages, for example, can hinder water distribution and impact agricultural irrigation,
ultimately affecting the economy and people's lives. Adopting innovative technologies, such as efficient irrigation systems, can help reduce water consumption in agriculture and alleviate pressure on the overall system.
As the saying goes, water is life, and we need to do everything we can to ensure that we protect this precious resource so that it doesn’t become the next biggest crisis in our lifetime.
Together we can be intentional about leaving a legacy of quality water for all, especially the vulnerable communities who are most exposed by the threat of deteriorating water quality.
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Bonga Ntuli Executive Board Member & Director of Strategy Royal Haskoning DHV Southern Africa
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Inospace ventures into e-commerce logistics leveraging off its offering
The company launched its first outsourced warehousing and distribution facility in Cape Town to support the growing needs of emerging and fastgrowing businesses.
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traditional
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nospace, last-mile logistics park owner and operator, has launched a outsourced fulfilment warehouse facility to help small and medium-sized e-commerce businesses with their warehousing and distribution needs.
The company recently launched its first e-commerce fulfilment and outsourced warehousing facility at one of its existing properties – Island Works Logistics Park at Paarden Eiland in Cape Town.
existing e-commerce platforms like Shopify. This makes it easy for users to schedule deliveries and ship products directly to their customers, whether they are other businesses or end-user consumers.
“Our business model is based on the view that traditional landlordism is being disrupted
A second facility is scheduled for opening in early 2024 in Midrand, Johannesburg.
Inospace invested over R20m in revamping space converting it to an e-commerce fulfilment warehouse and distribution facility, and developing software to optimise e-commerce fulfilment and maximise transparency in the supply chain.
Businesses can now rent a fixed warehouse space and/or daily scalable outsourced warehouse space – leaving Inospace to pack and dispatch orders on their behalf.
The company’s digital platform allows seamless integration into
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– real estate requires customercentric solutions and value-adding services. An integrated fulfilment facility provides e-commerce businesses with a seamless logistics ecosystem,” says Inospace CEO Rael Levittt.
Levitt says a specialised warehousing and distribution
offering supports Inospace’s strategic ambitions to create a frictionless end-to-end logistics environment that supports emerging and fast-growing businesses.
Levitt explains that the automated fulfilment process starts right after users have placed an order on
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Inospace’s platform. The company provides storage for the user’s stock until an order is placed. Inospace then processes the order, packs and dispatches it to the end-user on behalf of the customer for a fee.
The platform automatically selects the lowest pre-negotiated courier prices and the most favourable terms based on customers’ requirements.
Inospace has created two pricing models – a starter plan of R5,250 for up to 100 orders per month and a custom plan with costs based on usage and orders that exceed 100 orders a month.
Alongside the investment into this facility, Inospace has appointed Dean Venske, who heads the logistics team and in-house warehouse managers.
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shared services in warehousing, inventory management and fulfilment,” says Levitt.
Founded in 2017 with one asset valued at R30m, the unlisted company has grown its portfolio to R3bn. It owns and operates 52 logistics properties in Cape Town and Johannesburg, home to more than 1 500 tenants who distribute goods directly to consumers and other businesses.
To resolve business pain points and add material value to small and medium enterprises (SMEs), the company launched Inocircle, an online marketplace for its clients in 2022.
Venske is a seasoned executive with extensive knowledge and experience in logistics. He holds a Master’s degree in Logistics from the University of Pretoria.
The platform matches tenants with vendors, and offers customised customer-support services. The free subscription service helps tenants manage their supply and procurement demands as well as access industrial and logisticsrelated goods and services offered by various vendors at preferential rates.
“Venske and the Inospace team are tapping into a strategic and unique opportunity at the intersection of community and
Levitt says Inospace has made enormous progress in growing its physical last-mile logistics real estate platform over the last three
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years. The launch of the fulfilment warehouse is another innovation focused on solving tangible pain points for smaller business owners, allowing them to streamline their logistics operations.
The team behind Inospace, including COO Jacques Weber and Chief Marketing & Product Officer, Jodi Sher, travelled to the USA to learn from the world’s leading property companies that have combined traditional real estate with logistics and fulfilment services.
Weber, who runs the group’s operations, explains that they have learnt that e-commerce businesses often face fluctuating inventory sizes and seasonal demand challenges. As such, Inospace’s all-in-one logistics solutions allow companies to adapt and scale their operations, based on ever-changing supply and demand requirements.
ABOUT INOSPACE
This flexibility speaks to Inospace’s high demand for a differentiated bundling of services, where customers can use a mix of offerings, including physical space, fulfilment services or scalable outsourced warehousing.
“By launching an all-in-one logistics solution, Inospace is providing a much-needed boost to growing e-commerce businesses in South Africa. This levels the playing field for smaller businesses who can compete more effectively with larger companies,” adds the company’s Chief Marketing & Product Officer, Sher .
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Inospace is South Africa's largest owner of serviced logistics parks, providing a range of spaces overlayed with appealing value-adding services. With its branded rental products, SME-centric logistics offerings and flexible leases, Inospace has quickly grown into a niched sector specialist with assets under management of R3bn. www.inospace.com
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Office ownership in Unravelling the business term advantages of workspace
By Neil Bernberg
In the world of business, decisions should be driven by both short-term gains and long-term sustainability. When it comes to choosing a workspace, business owners are increasingly recognising the financial and strategic advantages of owning their office space. Investing in your own business premises, such as the office spaces available in Cape Town’s City Bowl, not only reduces monthly overheads but also provides a range of benefits that can contribute to your financial future and overall success.
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Cape Town City Bowl: sense and longowning your own
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I
t just makes financial sense One way to own office space is the concept of sectional title office property. By purchasing your own office space, you are building equity which could be an opportunity to invest in your retirement as a business owner. Unlike renting, where your monthly payment is essentially an expense, owning property allows you to allocate your funds towards an asset that will appreciate over time. The value of your investment will likely increase, providing a financial cushion for your future.
While rent is subject to increases, purchasing office space ensures that your monthly instalment remains constant. As landlords often raise rental costs over time, owning your office space provides stability and control over your business environment.
Traditionally skyscrapers are owned by listed funds and investors. The sale of office floors at properties such as The Pinnacle is an example that allows individual investors and owner occupiers an opportunity to partake in this typically exclusive market. City Bowl also offers the unique opportunity for potential
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income generation. With large floor plates ranging from 400m2 to 800m2, you can choose to subdivide and rent out any unused space. This additional income stream can further contribute to the growth and success of your business.
Brass tacks and better tax From a tax perspective, you can claim an income tax deduction on your monthly bond interest payments. When renting, you would claim the monthly rental amount. While claiming the whole rent may be a larger amount than the interest portion of your bond, you can usually customise an office space you own far better than a rental property, and get better value from the same, or less, floor area.
When making improvements to your property, such as custom meeting rooms, call pods, recreational and work areas, these improvements can be capitalised and provide an additional annual deduction, at 5% of the value of the improvements, and possible
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further reductions in tax if you sell depending how much has already been claimed.
When renting, however, even if your landlord does allow the construction as part of the lease, the improvements themselves
are harder to claim, falling under “leasehold improvements” which is a more nuanced area of tax law to apply.
Making the move Another factor that makes owning office space in Cape Town City
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Bowl an attractive proposition is the phenomenon of semigration to Cape Town from other parts of South Africa. The Western Cape’s governance and lifestyle factors have set it on a different trajectory than the rest of the country making relocating a particularly attractive option to business owners.
As more businesses and professionals migrate to Cape Town, a trend which is set to continue for the foreseeable future, demand for office space is on the increase meaning that the capital appreciation of your asset is assured. Owning an office space in this flourishing region
positions you at the forefront of economic opportunities and growth by making a sound property investment.
Location, location, location As cliche as this may sound, location really has a meaningful impact on any business from an accessibility perspective. Prime location is a standout feature that cannot be overstated and situated on the hospital grid, office spaces for sale also benefit from uninterrupted power supply. With no loadshedding, your business can operate seamlessly without the disruptions faced by many others who are grappling with the staggering costs associated with keeping their business operational during the daily planned power shutdowns. This reliability is crucial for maintaining productivity and client satisfaction – and can also positively impact staff morale.
Property in the City Bowl has a proximity to key institutions such as the Courts, the Masters’ Office (which is located in the adjacent building), and the Deeds Office (a 5-minute drive or 10-minute walk) provides unparalleled convenience. Being within a few minutes of the High Court,
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Labour Court, and Magistrates Court, streamlines administrative processes and saves valuable time for legal practices. The location is further enhanced by its accessibility to Cape Town station (a 4-minute walk away) and just 6-minutes on foot to the nearest myCiti Bus stop, making it an ideal choice for businesses reliant on efficient transportation such as call centres.
Owning office space in the City Bowl offers freedom and flexibility to personalise it according to your brand and identity. This not only enhances your company’s image but also provides a sense of ownership and pride for employees to work in an environment that reflects the company culture.
allows you to optimize your space utilization and store essential business items without the need for external storage solutions.
Owning office space in the City Bowl is a strategic decision that provides long-term benefits for your business. From financial advantages and the potential for additional income generation to the unique location advantages and freedom of personalisation, the advantages of ownership are numerous. Take the leap towards stability, control, and future growth by investing in your own office space to Cape Town City Bowl. Discover the power of owning your business environment and unlock your potential for success.
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Many of the offices prioritises security and access control, providing a safe and protected environment for your business. With 24/7 security, you can have peace of mind knowing that your assets are safeguarded.
In addition to office spaces, many City Bowl offices offers on-site storage space that can be purchased. This convenient feature
Neil Bernberg Owner Director Port Commercial Properties
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Unlocking refunds: South Africans investing in Australian
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UK Property Market achieves 43 years of positive growth - Birmingham rental market surges by over 40% in just 3 years
TRENDING ONLINE
Tech, data and AI hold solutions to the residential property market
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Retirement Visas: South eligible in more countries list & property purchase
By Editorial
Residence-by-Investment (RBI) and Citizenship-by- Investment (CBI) programmes are more in demand over the past few years to South Africans who don’t have ancestral ties to other countries but are keen to gain residency or citizenship. This is either in a South African Development Community (SADC) jurisdiction and/or a European country, with access to visa-free travel anywhere in the EU.
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Africans now - Mauritius tops not required
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‘G
olden Visa’ and citizenship programmes are mostly beyond the financial means of most South Africans, which is why the more affordable residency options opening up around the world have become extremely popular,” says Rone’ Silke, Senior Executive at Sovereign Group.
for countries that continue to offer the RBI schemes.
Most popular at the moment are those generally termed ‘Retirement Visas’, which are aimed at people who have a certified monthly pension or annuity income sufficient to live on in the country of their choice.
Silke says the top three choices currently for South Africans who want to obtain permanent residency by applying for a ‘retirement visa’ are Mauritius, Portugal and Panama, and that the basic requirements for obtaining permanent residence in these countries are as follows:
They allow applicants to continue to also work remotely and, unlike the current Residence by Investment RBI and Citizen by Investment (CBI) schemes, they do not require applicants to buy real estate.
This makes the programmes accessible to many more people, and the timing couldn’t be better, because the European Union Commission (EUC) on Citizenship is determined to ensure that all CBI programmes are completely phased out by 2025, and that stringent new rules are put in place
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The EUC has become increasingly worried about the opportunities that visa-free travel around the EU creates for money laundering, tax fraud and various other serious crimes hence the popularity in retirement.
Mauritius
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Mauritius is rapidly becoming one of the top retirement destinations in the world for South Africans who are seeking a safe haven with a great climate, excellent healthcare and that is tax friendly, and should be number one on their list according to Silke.
A major consideration for retirees, says Richard Neal, head of Sovereign Mauritius, is finding a retirement country that is safe and politically stable, so that they can enjoy their retirement in peace.
Neal is now a resident of the island after recently moving his family over there says, ‘our island has a long history of political stability and social harmony, making it very attractive from that
point of view. It has an extremely low crime rate, which contributes to a sense of security and relaxation for retirees,’ something which most Saffers are seeking.
Mauritius offers a 10-year occupation or residence permit to ‘retired non-citizens’ over the age of 50. They must be able to: • Open a Mauritian bank account • Make initial deposit of $1,500 (R28,815) • Deposit $1,500 (R27,900) as income per month or $18,000 (R345,780) as income per year for the duration of the permit. • Provide evidence of deposits to authorities every year.
After three years, those who hold one of these occupation or residence permits can apply for: A 20-year permanent residence permit. • Spouse, parents & dependent children who are permit holders under-24 to be included. • Initial retired non-resident occupation permit where no purchase of property is necessary
Retired non-citizen permit holders can also invest in a business in Mauritius although they cannot
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manage the business, be employed by it, or draw a salary. There is no restriction on remote work. This will be covered in more detail in a separate article.
Portugal
•
•
Buy property in Portugal if they wish, but is not necessary at first Have a rental agreement in place for at least 12 months
After this, their application will
Portugal offers D7 Residency Visa to retirees or income holders who want to live in Portugal and who have sufficient passive foreign income to qualify.
Applicants need to: • Open a Portuguese bank account • Deposit minimum €8,460 (R177,490) a year per individual or €12,690 (R266,236) a year per couple to qualify for Visa.
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need to be considered by the Portuguese Consulate before they are granted a four-month visa to visit Portugal and finalise the residency process with the immigration authorities.
The D7 Visa confers non-habitual resident status, which includes exemption from tax on certain foreign income, and access to Portugal’s public health system. In addition, those with a D7 Visa can
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after five years apply for citizenship or a Portuguese permanent residency permit valid for 10 years.
Family reunification can be carried out in terms of this visa, but requires an additional application and approval by the immigration authorities in Portugal.
Panama Consulate.
Spouses and dependent children can be included in this visa, at an additional monthly income requirement of $250 (R4,802) per person. Children aged 18 to 25, however, need to be full-time students to qualify as dependents.
Panama
Panama offers the ‘pensionado visa’ to applicants who have a guaranteed income for life of at least $1,000 (R19,210) a month, to be deposited into a Panama bank account.
This can be a state pension, or a certified annuity from a bank, business or insurance company that has been accepted by the
Once approved for a pensionado visa, applicants will immediately be issued with a temporary residence card and then, four to six months later, a permanent residence card that is valid for life and gives them access to Panama’s public health system, as well as many other pensioners’ benefits and discounts.
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UK Property Market of positive growth - market surges by over
By Sophie Gamborg
Last month I returned to the UK to visit family and to look at some of the UK property that LIO International are offering to South African investors. I managed to enjoy a few weeks of sunshine, which was good timing, because since then the UK summer has been up to its usual tricks of continuous drizzle and a forecast of mostly dull British rain.
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achieves 43 years Birmingham rental 40% in just 3 years
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T
he UK property market forecast on the other hand gives a much more positive outlook. The rental market continues to boom and private rents have witnessed a massive surge, outpacing previous records. To give an example, a large proportion of our investment stock is situated in Birmingham where rents have gone up almost 40% in just 3 years and expected to increase by 20% year on year going forward! It is quite phenomenal.
UK inflation is easing and is at a 15 month low of 7.9%. The bank
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rate is still high at 5.25% and likely to increase again to 5.5%, but confidence is evident with the drop in inflation and major lenders cutting their mortgage rates. There is even talk amongst leading UK property experts that we are now at the peak of the mortgage market.
The bustling UK market When it comes to the UK property market, whether interest rates are up or down, whether house prices are on the up or not moving, it remains as sturdy and strong as it has ever been. The past 50 years of the UK
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property market shows 43 years positive growth and reminds us of its resilience. Even now with the property headlines painting a picture of doom and gloom, house price growth is still in the positive and seeing year on year growth. Property continues to offer stability and opportunity to investors.
In South Africa most overseas property buyers like owning a UK property because it acts as a safety net. As an asset class property tends to appreciate over time and if bought in the right location can provide not only capital growth but a secondary income in the form of rent – a double-whammy as it were. Not to mentioned the exchange rate hedging. Yet, many local property investors do not know that the UK offers UK bond finance, up to 75% and it is interest only. This means that in most scenarios you are cash flow positive as soon as the property is rented.
Taking the plunge into the UK market Are you reading this and thinking this is all very well and good but how on earth do you even buy a property overseas as a South
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African? Surely its complicated and fraught with risk?
Buying property in the UK is a lot more straight forward than people think. Of course, it is expensive converting from rands but the whole idea is to get your rands in pounds, and if you have options to make staged payments until your property is transferred and a company such as us can manage the whole journey for you – it makes it an easier process and not such a daunting prospect.
And that’s what we do at LIO International - offer an end-toend service. We have all the contacts in house for bond finance, conveyancers for transfer and rental/managing agents. If you want 100% deposit protection, we can offer that; if you want a rental guarantee we can offer that. Some of our developers estimate 200% return on specific investments over 10 years.
Rand vs the Pound The Western Cape is an incredible place to live and I believe it has a lot going for it, which is why I moved here from
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London with my family. There are aspects that are not so great; the electricity, the pockets of crime and the public transport, but there is positivity; evident from the mass of development popping up all over the Atlantic seaboard and the construction of the new Amazon Headquarters.
However, don’t get too excited about Cape Town because the
reality is the Rand is still losing value to the pound and I think it is important to bear in mind diversifying your portfolio and having some rand in a hard currency asset because it is the best way to future proof your hard earned Rands. Clients who took money out of South Africa 10 years ago and bought property offshore have been growing hard currency
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assets at a time the rand has been declining. This has future proofed their legacy. If you have children that may want to study in the UK in let’s say 5 or 10 years it is really worth thinking about this.
I certainly feel more confident as a parent having UK investment property, because my children may want to move aboard or back to the UK later in life and may need funding from the interest free bank known as mum and dad.
But why is now the right time? Often clients say to me I am going to wait until the rand gets stronger and my answer is this - when it comes to buying a property it is not ‘timing the market’ that is important - it is the ‘time in the market’. Let’s take a moment to think where the rand was 10 years ago. A buy-to-let investment property should be viewed as a long term investment option.
The bottom line is that UK property offers a solid economic proposition. It has a historic, proven track record of resilience,
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it offers income and appreciation, it allows you to hedge against the rand and whilst living in sunny South Africa, it is always good to have a safety net; an investment in a hard currency. “Live in the Sun and invest in the shade” as the saying goes.
Chart UK Housing Price Index. 80% of the LIO International property stock is situated in the north of England; Birmingham, Nottingham and Manchester; regions that offer investors the best opportunity for capital appreciation - contact us to find out why and where to invest.
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Sophie Gamborg Property Specialist LIO Global SA
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DE ZWARTLAND WERF
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Secure your future: 5 Compelling reasons to invest early in retirement properties
TRENDING ONLINE
What You Need To Know For Retirement
High demand for life rights sees launch of Ryn Village Retirement Estate just east of Johannesburg
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Secure your future: 5 Compelling reasons early in retirement
By Editorial
While many mature lifestyle estates have restrictions on the age of residents, there are no restrictions on buying property early as an investment. Because life expectancy is increasing, and the demand for property in mature lifestyle estates is only going to rise, getting in early is a wise decision.
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to invest properties
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“P
roperty remains a sound investment and a great addition to any portfolio, and mature lifestyle estates provide a really worthwhile long-term investment,” explains Jonathan Acutt, Managing Director of Acutts Real Estate. “
Buying into a retirement estate allows you to rent out the property to reliable tenants, but it’s important to do the relevant market research. Before deciding, consider factors such as the current rental income, escalation in property value, as well as the management and maintenance of the estate to ensure you’re getting a return on your investment.”
5 Key reasons to invest into retirement property now
1. Security and lifestyle
The demand for safe and secure living has resulted in a rise in estates across South Africa, many of which include a retirement section or are completely retirement-focused. This is a great, all-inclusive investment with amenities and facilities available for residents’ use, 24-hour security, and ongoing maintenance. This makes mature
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lifestyle estates much more appealing for renters who want the convenience of a lock-upand-go lifestyle without the added expenses.
2. Peace of mind
Retirement plans are often left too late, and when it comes to finding a suitable home, there might be insufficient housing stock or the prices are simply too high. By investing in a retirement property early, there’s time to do due diligence, research the market, and find a quality investment that can be paid off over time. This provides investors with peace of mind about the future.
3. Rental income
When investing in a retirement
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estate at a young age, the investment potential is increased through rental opportunities. Rental income generated through a retirement property must be in line with – or higher than – the rate of inflation. Acutt explained that an estate like Renishaw Hills on the KZN Mid-South Coast has shown remarkable rental returns. For maisonettes, investors are getting between R11 500 and
R13 000 rental per month, depending on the location, with three-bedroom freestanding homes around R13 000 as well. For homes, this goes up to R17 000 a month with tenants benefitting from incredible sea views and on-site facilities.
4. Great resale value
Potential investors are also encouraged to assess the sales of similar surrounding properties
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over the past few years to better gauge the resale value. Acutt said that Renishaw Hills, which is now in Phase 6 of construction, was established in 2016. In that time, investors have enjoyed an escalation in home value of more than 50% - a significant spike. He explained that the quality of the finishes, facilities, lifestyle, and security all contributed to the escalation in value, which is only anticipated to rise.
5. Generational legacy
Buying a retirement property as an investment allows investors to generate an income without selling the property, thereby building a legacy for families. A good property portfolio has the potential to provide significant financial stability for the heirs.
Retirement developments ticking the boxes Renishaw Hills forms part of the
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2.6-million-square-metre Renishaw Coastal Precinct. This is the first development within the mixeduse precinct which is set to include residential, retail, educational, healthcare and light industrial/ commercial zones. Residents enjoying the state-of-the-art security of Renishaw Hills have access to high-end facilities, extensive nature trails, and welcoming communities for retirees.
Renishaw Hills ticks all the right boxes for a valuable investment for those at preretirement age. This Scottburgh-based estate has just launched Phase 6, a series of high-end free-standing units and maisonettes boasting spectacular sea views and houses surrounded by coastal greenery.
Devmark Property Group’s The Retirement Collection has become synonymous with
successful retirement villages including Clé du Cap, Legato, Heritage Manor, Onrus Manor, La Vie Est Belle, Langebaan Manor Villa Cortona, The Plettenberg Manor. And Helderberg Manor in Somerset West. Imhoff Manor near Kommetjie will be launched soon. DevMark are also the property developers of Langebaan Manor situated in the centre of the popular coastal town, close to all amenities as well as pristine white beaches surrounding the worldrenowned Langebaan lagoon. The area offers excellent holiday facilities and experiences from golf courses to water sports, the nearby West Coast National Park to the West Coast Fossil Park.
The development comprises authentic West Coast architecture with ten different house types and two apartment types to choose from. Prices range from R1 599 million to R3 950 million and include both VAT and transfer costs. All properties will be fitted with quality, standard luxury fittings and a choice of further optional extras.
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From humble beginnings Leader: Unveiling remarkable journey in Surveying
By Editorial
Vuyolwethu Badi, a seasoned Professional Quantity Surveyor with over 16 years of experience in the South African Built Environment, is making a significant impact in the industry. As a Director and Shareholder at RLB, a prominent global cost consultancy firm, her journey to success has been marked by determination, resilience, and a deeprooted desire to uplift her community.
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to Industry Vuyolwethu Badi's Quantity
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A
Serendipitous meeting with her future career
Born and raised in rural Middledrift in the Eastern Cape, Vuyolwethu's upbringing in a conservative family laid the foundation for the person she is today. Her late mother, a teacher, and her father, a former politician and businessman, instilled in her the values of love, discipline, and nurturing. Despite her modest background, Vuyolwethu's drive and curiosity led her on an unexpected path towards quantity surveying.
"I first went to a local school, but in Grade 3, I identified Adelaide Gymnasium school as my preferred choice,” she recalls. “I saw the girls from that school in their smart blazers and ties, and I wanted to dress like them. It connected me to the ‘big wide world’.”
She then stumbled upon the industry by accident, she explains. “I approached a man who was measuring up the school's hostels for renovations and inquired about his work. That's when I discovered what quantity surveyors do. At that time, I was struggling to decide on a career, and I became convinced
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that quantity surveying would enable me to give back to my poor community."
Vuyolwethu's journey to becoming a registered quantity surveyor involved hard work and perseverance. She completed her BTech degree in 2007 and joined RLB in 2014, where she made an immediate impression with her strong work ethic. By 2016, she had completed all the Professional Skills Modules prescribed by the South African Council for the Quantity Surveying Profession (SACQSP) and became a registered Professional Quantity Surveyor. Remarkably, she achieved her goal of becoming a director at the age of 33, ahead of her initial target of 35.
She vividly remembers the early days when she struggled to secure an internship, but her boldness and determination prevailed. "In mid-February of the year, I should have started my internship, but I was still looking for a job. I walked into the Department of Public Works in Pretoria and asked to speak to someone about the quantity surveyors they worked with. I had to fend for myself without the support networks
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available to young women today," she shares.
Giving back and moving forward Vuyolwethu says her involvement with ASAQS has been instrumental in her career development. Since 2016, she has proudly maintained her professional membership and briefly served on the ASAQS Gauteng Chapter from October 2022 to May 2023.
"What I appreciate most about my membership with ASAQS has been the organization's steadfast commitment to providing highquality, continued professional development training. Through various training modules and webinars, I have had the opportunity to stay abreast of industry trends and gain a deeper understanding of the quantity surveying profession," she affirms.
approach every task with focus, integrity, and high standards of work ethics while continuously seeking personal growth through acquiring new skills and expanding their knowledge.” Beyond her professional achievements, Vuyolwethu finds joy in travelling and cherishing moments with her family. “When I'm not engrossed in work, my mind is consumed by planning my next thrilling adventure. Exploring new destinations and creating unforgettable memories is my ultimate passion."
With her remarkable achievements and unwavering spirit, Vuyolwethu is paving the way for future generations and leaving an indelible mark on the industry.
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As an experienced quantity surveyor, Vuyolwethu offers valuable advice to youngsters considering a career in the industry. "To truly excel and thrive in this challenging professional landscape, it is essential for youngsters to prioritize professionalism above all else," she asserts. “They should
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DEVMARK
PROPERTY
GROUP
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Library
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Look out for our next issue in September/October 2023