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17 June 2007 private equity fund of funds

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Build versus Buy Checklist 06 Feb 2007 / by Jacques du Toit Jacques du Toit of the Absa Group, looks at what factors you should consider when deciding whether to build a new house or buy an existing home. This is the last of a series of three articles on building versus buying a house. Previously we looked at the historical trends in new and existing housing in South Africa, and at an overview of the advantages and disadvantages of building as opposed to buying a home. equity income funds

Here the focus will be on what important points you need to keep in mind when either choosing to build or to buy. These factors, positive and negative, legal and financial, should be thoroughly investigated and considered before you decide on what path to take, as it is can be a costly and lengthy process with possible unforeseen implications. capital casebook equity

The financial aspects of acquiring property will impact an individual or household for many years into the future. Therefore, it is important that you should consider the possibility of an increase in interest rates and take this into account if a property will be mortgaged. private investment in public

A tax clearance certificate from the South African Revenue Service (SARS), stating that the tax affairs of the prospective owner of a property are in order with SARS, is one of many documents needed before the property can be registered at the Deeds Office. equity mutual funds

The following aspects also need to be carefully considered and checked: Building a new house birmingham contact equity

• Make use of a reputable building contractor or developer by obtaining reliable references and checking up on previous projects (quality of workmanship, delivery times, etc.). A contractor should ideally be registered with the National Home Builders Council (NHBRC) and be a member of the Master Builders Association. private equity investment firm

• Get a detailed and signed quotation from the building contractor or developer. complying deal equity funds

• Obtain a signed contract between the new owner and the building contractor or developer. equity msn private wyoming

• Ensure the material is specified in the quotation and contract. american equity investment

• Obtain certainty that the land is zoned for residential development. equity index funds

• Apprise yourself of any servitudes and restrictions that may be stipulated in the title deed. equity private team wyoming

• Confirm the physical location, address and stand number as stipulated in the title deed. equity group investment

• Check the size of the stand as stipulated in the title deed. capital development equity

• Determine the exact borders of the stand, making sure perimeter walls of the properties bordering the stand are in the correct position. article between difference

• Check availability of municipal services (water, sewage, electricity and refuse removal). contact equity private wyoming

• Obtain a full set of building plans, officially approved by the local government. agreement equity investment

• Ensure you have knowledge of all building restrictions and regulations as stipulated by the local government. business equity funds

• Examine the slope and ground formation of the stand, which may require levelling and excavation operations, special draining systems, retaining walls, concrete reinforcement, special construction methods and the involvement of an engineer. These could have significant cost implications. private equity fund

• Check the views onto and from the site. investment property home

Buying an existing house managed equity funds

• Check the physical state of the property and get expert opinion if there are any uncertainties. capital entrepreneurial equity

• Determine stand size and building area of all structures. private equity hedge funds

• Examine the possibility of extensions to the house and outbuildings, or the building of a pool, lapa or carport. Take into account existing structures plus the availability of space on the stand and be sure you will not be transgressing building restrictions or regulations. email equity private wyoming

• Apprise yourself of the possibility of adding value to and possible over-capitalisation of the property when doing renovations and extensions. equity loan on investment

• Take into account the position of the house on the stand with regard to wind directions. equity income mutual funds

• Note the direction and extent of the run-off rainwater in the event of heavy downpours. private equity group

• Check the extent to which structures such as walls and foundations are or may be impacted by root systems of large shrubs or trees in the garden. private investment public

• Confirm that building restrictions and regulations have not been violated by obtaining a full set of approved building plans for all structures on the stand. real estate private equity

• Ensure that all municipal accounts for property tax, electricity, water, sewage and refuse removal have been fully paid by the owner. A clearance certificate, stating that all accounts have been fully settled and valid for a period of 120 days, must be issued by the municipality. contact equity private us

• Check the existence of any business rights on the property or other properties in the area and the possibility of such rights being granted in the future. real estate equity investment

• Take note of other properties in the area already being used for business purposes, which may impact traffic volumes, noise pollution and security. structuring venture capital

• Find out if there are any future plans that local government may have to widen streets, open up cul-de-sacs or rezone vacant land in the vicinity for high-density residential developments or commercial use. This may affect traffic volumes, noise pollution and security. equity private quebec team

• Determine the extent of traffic congestion and noise pollution in the area by visiting the property at different times during the week. equity mail private wyoming

• Take note of trends in property values in the area. investment home equtiy loan

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The Seven Year Itch 06 Feb 2007 / by Gina Schoeman The Seven Year Itch: What to do with your property-relationship in 2007. Married or not, you re likely to have heard the warnings of the seven year itch. In a marriage, it is thought that the seventh year anniversary brings with it a small helping of trepidation, a pinch of complacency and above all, a large dosage of consolidation. Similarly, the seventh year in this decade s property market hints to bring about a certain period of consolidation after some very comfortable years of becoming rather intimately acquainted with booming property prices. private equity jobs

The official meaning of the idiom, the seven year itch, is that of the inclination to become unfaithful after seven years of marriage. If one applies this to one s marriage to the property market, it may be suspected that some individuals may feel inclined to shift away from property and into other asset classes (such as, for example, the equities market). I am, however, about to take on the role similar to that of a marriage counsellor to explain the advantages of remaining in the property market over this period of consolidation, even though the itch may at times seem unbearable. equity investment strategy

The graph to the left depicts the cycle that South African house prices have followed from 2000 to 2006. It is clear that the trend has been exceedingly positive throughout these years, while the recent decline in house price growth continues to remain above growth levels at the start of the decade. It is expected that during 2007, although growth will not reach the historic highs of 30%, it will remain on a path of stabilised growth. The most recent data shows that house price growth has decelerated to single digits of 6.24% year-on-year in December 2006 from the double digits experienced in the first six months of 2006. This single digit growth is expected to remain throughout 2007 as the combined increase of 200 basis points in interest rates in 2006 begins to impact the demand for housing. A phase of great growth in a market often requires a period of consolidation whereby the consequential wealth creation is able to be absorbed completely. It is for this reason that 2007 is expected to bring about a solid perspective on the future of property prices in South Africa. education equity investment

A few factors have dampened house price growth, and for good reason

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• Interest rates were hiked four times during 2006, thus stabilising the demand for housing due to the debt repayment becoming more costly; equity guide in investment

• The natural incidence of first-time homebuyers migrating into the housing market has been stalled in some circumstances where the individuals find the housing market too expensive, thus remaining in the rental market in anticipation of their income levels rising; and finally, contact equity private quebec

• The anticipation of the National Credit Act, to come into effect in June 2007, plans to bring together increased transparency to both the lender and the borrower, thus initiating a stricter form of credit control, while at the same time, more responsible participation in the credit market. home equity investment

It is expected that following a period of consolidation in 2007, the following year will once again see property price growth move into double digits as demand and supply catch up with one another. For this reason, it is expected that this market will continue to be highly beneficial for investment purposes, attributable to the historical high returns conducive to owning, managing and understanding property. dimension equity in private

• Developer credit equity home investment

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• Prospective Homeowner equity guarantee insurance

The Builder, Developer and Homeowner need to be registered with NHBRC, as does the dwelling, regardless of funding, whether cash or Mortgage bond. A financial institution may not give a home loan if the above has not been initiated. private equity analyst

NHBRC applies to the following: equity investment policy

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• Sectional Title Flats and Gated Communities top private equity firm

• Real Right Developments private equity deal

The warranty scheme only applies to new houses built by home builders registered with NHBRC and the enrolment provided by the registered home builder is transferred automatically to anyone who buys the house during the 5 year warranty period. apollo private equity

Defects and poor workmanship must be recorded formally (in writing) to the Developer or Contractor as well as NHBRC within 3 months from date of occupation. Roof leaks attributable to poor workmanship and materials must also be recorded formally (in writing) to the Developer or Contractor as well as the NHBRC within 12 months from date of occupation. birmingham equity msn private

The NHBRC warranty takes effect from date of occupation by the Homeowner of the newly built dwelling, providing that the dwelling was enrolled with NHBRC and that the NHBRC did not issue a formal letter of non-compliance in accordance with NHBRC technical requirements. birmingham equity mail private

Significant and far reaching changes came into effect on 16th March 2007, and have been put into place to offer more protection to the end user who is contracting with home builders for the construction of residential homes. Dave Warmback of Durban law firm, Shepstone and Wiley, summarises the changes as follows: private equity capital

• Home building contracts may now only be concluded once the housing consumer has had 30 Calendar days to view the contract. There are far reaching consequences for Developer/Agent, as it could hold up the process of sales. private equity investing

• Restrictions on clauses in contracts, which have the effect of taking away consumers common law or statutory rights. chicago private equity

• Restricting deposits to no more than 10% of contract price of a fixed cost building contract. capital equity india private

• Minimum clauses that must be included in a building contract, and an obligation that a home builder must retain a copy of the contract and all records relating thereto, for a period of at least six years; equity mail private quebec

• A home builder may not accept final payment under a building contract unless the bank, NHBRC or competent person has certified in writing that the work has been completed according to NHBRC s prescribed minimum standards and guidelines. private equity funding

According to Warmback, the National Home Builders Registration Council, acting in terms of Section 7 of the Housing Consumer Protection Measures Act 95 of 1998 ( the Act ), have drawn up and published the Code, which is intended to provide minimum standards to be maintained by all NHBRC Home Builders. equity jms private

He goes on to state, A Home Builder is defined in the Act as a person who carries on the business of a home builder and importantly, while the Code is no doubt aimed to target the smaller home builder (against whom most protection is needed for consumers), it will also be applicable to larger residential developers, developing and selling residential dwellings, whether freehold or sectional title. Home builders are obliged to register with NHBRC and are obliged to enroll a particular home or development with the Council, submit information relating to a development and pay a prescribed fee. birmingham email equity

On the 5th April 2007 the Government Gazette published a draft of the new NHBRC grading system, which makes provision for the establishment of grading categories in order to encourage good building practices. private equity conference

The grading system will be categorised as follows: private equity career

• Responsiveness to housing consumers complaints private equity definition

• Timeous enrolments of homes private equity week

• Compliance with the NHBRC Technical Requirements private equity fund raising

• High quality in building homes private equity atlanta

Changes to the above will be made as the need arises. The Grading system will be used to determine the fees the Builder or Developer will be charged by the NHBRC. The performance score shall be calculated in accordance with the new formula, which can be obtained from the Government Gazette published on 5th April (Vol. 502, number 29747). Failure by home builders to comply with the NHBRC Code of Conduct could result in serious consequences. The NHBRC is entitled to withdraw the registration of a home builder found guilty of contravening the Code. china private equity

There is little doubt that consumers will be better off when the Code is adhered to. End users will finally have recourse against home builders who are guilty of bad building practices. For more comprehensive information, visit the NHBRC website at www.nhbrc.org. http://www.1lifedirect.co.za/equote.asp VDN=1484 Buy Property | Sell Property | Rent Property | About Us | Contact Us largest private equity firm

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Residential Property: Global Risks 28 May 2007 / by John Loos Despite my optimism regarding residential property s performance over the rest of the decade, nothing is ever without risk. Many would point to the current upside risk to interest rates emanating from exogenous inflationary pressures. While this is a risk, I believe it to be a lesser one. The key risk may, perhaps ironically, involve a declining interest rate scenario. It emanates from the troubled US housing market which, if it experiences a collapse, could throw our global soft landing base case forecast out and send the world economy towards recession, along with significant slower economic growth in the domestic economy. This would probably be a low inflation scenario, offering the Reserve Bank (SARB) scope to reduce interest rates. The crucial question is would the SARB respond aggressively Possibly not, given its concerns with local credit growth and a wide current account deficit. The combination of sharply lower economic growth and very slow interest rate cuts could be more problematic for the housing market than solid economic growth and further mild rate hiking. axa private equity

THE KEY RISKS TO RESIDENTIAL PROPERTY ARE CURRENTLY FROM GLOBAL SOURCES

Much is made of rising interest rates and their potential negative impact on the residential property market, and to be sure we are seeing some negative impact from the latest cyclical hiking phase. Given the current upside risks to inflation and interest rates, it is natural that many people may act with caution in the residential property market at present. private equity financing

However, I would contend that the key risk to the residential property market may ironically involve a declining interest rate phase. Crucial to this view is, firstly, the fact that we have had a change in monetary policy from the 1990s policy that sometimes involved sharp hikes in interest rates in order to support the level of the rand. 1998 s 725 basis points worth of hikes in less than 2 months was a good example of what could happen those days, and the housing market was sent reeling. Today, however, official CPIX inflation targeting makes such shocks far less likely because the CPIX is a far less volatile variable than the rand. Indeed, the Reserve Bank has behaved in a far more stable way during the last two rate hiking cycles, despite a very severe rand crisis in 2001, supporting the notion that sharp and big interest rate moves are far less likely these days. india private equity

Therefore, even should our forecast of unchanged interest rates until well-into 2008 prove to be incorrect, and rates were to rise further, the pace of hiking is likely to be very moderate, and the negative impact on the overall housing market mild. private equity software

In addition, neither the South African household s debt service ratios, nor affordability in terms of the repayment value on an average priced house expressed as a percentage of average income, are particularly high. This also serves to reduce the risks involved with interest rate hikes. care equity health private

The declining interest rate scenario that I refer to as a bigger risk is one in which the troubled US housing market could play a major role. The graph below shows the sorry state of the US housing market. The NAHB-Wells Fargo surveys home builder confidence and they, similar to households, have experienced a severe dent in confidence which is widely blamed on the so-called sub-prime market. council equity private

The sub-prime market refers to that group of borrowers that do not normally qualify for prime financing due to low credit scores. They borrow from sub-prime lenders at higher interest rates, which are supposed to compensate for the higher risk of default on such loans. However, it is becoming apparent that some major lenders in this market did perhaps not get their pricing for risk right, bad debt risk is mounting, and lending policies are tightening. private equity news

Interest rate hikes were the key catalyst for the sub-prime problem. The US Fed raised its Fed Funds target rate from 1% around mid-2004 to 5.25% by 2006. This has had an impact on long bond yields, which also peaked above 5% in mid-2006, important for the strongly long-bond-linked US housing market. Since then, long bonds have come off their peak slightly, which may have helped slow the rot a little, but the situation still appears shaky. equity fund private start

The big danger to the US and global economy emanating from the US housing slump comes from the term equity withdrawal . There is a widely held view that US households have neglected saving for some years due to the positive impact of housing values on their household balance sheets. If this is indeed the case, it could mean that should the housing market collapse and house prices decline sharply, households could raise their savings rates significantly to compensate for balance sheet deterioration, which could severely impact on consumer demand. Given the importance of consumer demand in driving the US economy, this could prove disastrous and recessionary, not only for the US but for the global economy too. private equity lender

Don t panic yet though. Having raised interest rates so significantly, the Federal Reserve does have substantial ammunition, in terms of considerable scope for cutting rates, with which to fight off a recession so the soft landing /slower but positive growth scenario for the US still remains a distinct reality. blackstone private equity

What we are talking about here is still merely a risk scenario, where a US housing market collapse dents confidence to such an extent that the US Fed is not able to revive consumer spending even through cutting rates aggressively, resulting in a lengthy US and Global recession. private equity salary

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