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Property 24/10 - 538
04 February 2021 00:00
This week on Property24.com: REBOSA takes EAAB to court over 'FFC delays'; how different property classes coped with the pandemic; and applying for an assisted-sale programme when at risk of being repossessed.
REBOSA takes EAAB to court over 'FFC delays'
The Estate Agency Affairs Board (EAAB) is being accused of failing to deliver on its mandate of regulating, maintaining and promoting the standard of conduct of estate agents, specifically in the issuing of Fidelity Fund Certificates for 2021.
The Real Estate Business Owners of South Africa (REBOSA) has turned to court action against the regulator, claiming it is in breach of its statutory duties according to Estate Agencies Affairs Act 112 of 1976, and is asking the court to order the EAAB to urgently issue the necessary certificates.
REBOSA, acting on behalf of hundreds of its members, claims the EAAB has "become an active hindrance to their ability to conduct business in accordance with the law".
“Having a current Fidelity Fund Certificate is an essential requirement for a real estate agent,” says Chairperson of REBOSA and MD of the Rawson Property Group, Tony Clarke. “To practice without one is to commit a criminal offence and forfeit any right to remuneration for your work. By failing to meet its legal obligation to issue FFCs to qualified agents, the EAAB is forcing property practitioners to either refrain from operating, indefinitely, or break the law in order to feed their families. This is unacceptable.”
Property investment in 2021 | How different property classes coped with the pandemic
The property market has undergone huge changes during 2020 as a result of the Covid-19 pandemic, but not all sectors have had the same experience.
Global real estate marketplace, Wealth Migrate which allows investors to safely invest internationally, in quality opportunities for wealth preservation shares insights into how different asset classes have been affected and what lies ahead in 2021.
Scott Picken, CEO of online investment portal Wealth Migrate says, "The whole world is holding its breath as the slow roll-out of the vaccine heralds a return to normality, take note of the types of real estate you could pursue in the new year to ensure 2021 is be the beginning of fresh successes."
At risk of being repossessed? Apply for an assisted-sale programme
Homeowners who are under financial pressure and worried about falling into arrears on their home loan repayments should act quickly and do their utmost to prevent their properties from being repossessed and sold off at a sheriff’s auction.
StatsSA data for Quarter 3 of 2020 shows that unemployment increased substantially by 2,2 million (52,1%) to 6,5 million compared to quarter 2 of 2020. As millions of South Africans lost their jobs or experienced major dips in income in 2020, most of SA's major banks and credit providers responded by offering relief options to customers struggling to make ends meet.
Absa Home Loans Head of Collections, Mbuyiselo Khumalo, says that 135 000 home loan accounts received relief under the first three-month Absa Payment Relief Programme offering, and 42 000 under the programme’s extension period. Interestingly, the percentages of customers coming in to make arrangements was roughly the same as before lockdown. Still a “substantial proportion of customers opted for payment relief, indicative of the financial difficulties that consumers currently experience.”
Middle-market continues to drive property industry growth into 2021
The South African real estate market is most certainly one of the industries that has shined during these unprecedented times. Many industry players are still surprised at the outstanding sales performance in 2020 during Covi-19, and 2021 has started no differently from where we left off in 2020.
Shaun Rademeyer CEO of Multinet Home Loans says they have seen over a 50% increase in submission volumes in January 2021 in comparison to January 2020. “What is more interesting to see is that the middle market has been the catalyst o the growth” says Rademeyer.
In 2019 over 50% of all applications processed ranged in the price bracket of between R250 000 and R750 000. However, over the past several months there has been a shift with much higher volumes being processed from the price bracket of R750 000 and above. This higher value market now equates to 55% of all applications compared to the 49% in 2019.
“The increase in volumes in the higher end of the market has most certainly been attributed to the low interest rate cycle we find ourselves in” Rademeyer says.
Buyer's remorse | My financial position has changed, can I cancel my offer to purchase?
The South African economy has taken a beating due to the Coronavirus, with many individuals finding themselves under financial pressure. A Property24 reader wants to know under what circumstance can they cancel an offer to purchase, as they now believe they are unable to afford the Property due to a change in their financial circumstances.
"I have signed an offer to purchase a property in South Africa on the 21st January 2020. The property costs R1 000 000 and we are still waiting for the bond application outcome. Can I cancel this offer as I foresee that I won't be able to pay it due to a new medical discovery, which will put a strain on my finances? How can I go about cancelling?"
Kim Bam, Managing Director at Bam Law advises that it is always possible to cancel an offer to purchase, but not without consequences - unless the Offer to Purchase (OTP) provides for this.