Don’t sell just yet
Property owners under pressure should do all in their power to hang on a little longer says Aida.
Young Carr, CEO of Aida National Franchises expects that the market will turn for the better towards the middle of 2009.
“The realistic view is that economic pressure will ease shortly: Interest rates are set to come down, the latest economic figures point to lower inflation. Not only will this put extra money in consumers’ pockets, but it will also strengthen consumer confidence, which will impact greatly on the property market.”
Carr adds, however, that the next few months offer great opportunities for investors. “There is very good value out there right now, and price growth is likely to escalate once the cycle turns.”
He says market conditions during the past year were indeed tough.
“The upside for property consumers is that there was renewed focus on basics, which will ensure improved service levels in the property industry.
“At Aida we refocused on training and redirected capital expenditure for this purpose. Each and every Aida agent has benefited from refresher courses on the basics and we have made bursaries to the rune of R9 000 each available to all our agents to attain the professional qualifications now required by law.
“We have also strengthened our franchise network with resales in key areas and a notable development is interest from international franchisees, which see lucrative opportunities in the local market. We are in the process of forging ties with international companies who want to establish a greater presence in the local market.”
Young says much of this interest stems form the prospects for the local property market that will flow from the country’s hosting of the 2010 Soccer World Cup.
“We have seen increased interest from European buyers and investors who are coming to scout for property opportunities. “All these factors combine to set the stage for a recovery. We at Aida have been at work during the past year to make sure we will be first out of the starting blocks when the cycle turns.
Section 2(1) of the Alienation of Land Act 68 of 1981
Section 2(1) of the Alienation of Land Act 68 of 1981 reads: “No alienation of land after the commencement of this section shall, subject to the provisions of section 28, be of any force or effect unless it is contained in a deed of alienation signed by the parties thereto or by their agents acting on their written authority.”
The object of the section is to put the proof of the alienation of land beyond doubt and to avoid unnecessary litigation. The parties cannot waive the section because of the fact that this formality is in public interest and imposed by legislation.
The importance of section 2(1) for estate agents cannot be overstressed as non-compliance will make the deed of sale void and could lead to liability for the agent.
The following needs to be kept in mind when singing a deed of sale of land:
The contract must be in writing and signed by the parties thereto (section 2(1)).
Section 2(1) is not applicable on a transaction, where a company owns land and alienates the land by way of selling the shares of the company.
An agent needs to have written authority in terms of section 2(1) of the Alienation of Land Act 68 of 1981 to sign a contract on behalf of a party. Written authority in terms of section 2(1) of the Alienation of Land Act 68 of 1981 is not necessary when an agent is acting on behalf of a company.
- In Fraser and Another v Viljoen 2008 (4) SA 106 (SCA) the buyer (Fraser) sent an offer in the form of an uncompleted document to the seller (Viljoen). The names of the parties and description of the property were left blank. The offer was unsigned. The seller returned the offer contained the following in manuscript: (a) Name of the seller. (b) The signatures of the seller and two witnesses together with the date and place of signature.
Upon return, the purchaser completed the names of the purchasers, their sig- natures, and description of the property. The seller resisted giving transfer of the property on the basis that the sale was null and void because it contra- vened section 2(1) of the Alienation of Land Act 68 of 1981.
The court held: “Where the party to an agreement of sale of immovable prop- erty to appoint the other to be its agent for the aforementioned limited purpose of filling in a description of the property sold and the name of the purchaser the object of the legislation would be nullified. It would open the door to uncer- tainty as to precisely what the parties orally agreed upon and what the other party was authorized to do. The object of certainty would disappear. Had the Frasers returned the document to Viljoen for signature after the description of the property and the names of the purchasers had been inserted, there would have been a valid and binding agreement”.
- In Just Names Properties 11 CC and Another v Fourie and Others 2008 (1) SA 343 (SCA) the seller and buyer had entered into an agreement of sale of land. During the negotiations, the seller was not satisfied with the occupation rent clause. The estate agent of the purchaser requested the seller to initial two blank pages. The estate agent drafted the occupation rent clause on the initialed pages accordingly to the intention of the parties. Some time thereaf- ter, the seller cancelled the agreement on the basis that the agreement did not comply with section 2(1) of the Alienation of Land Act 68 of 1981.
Court held
- “On a proper construction of the Act, the offer had to be complete when the Fouries (Seller) accepted and signed it, or at least had to be signed by them in its completed form before they released it for delivery to the other party. The fact that they signed two blank pieces of paper is fatal to the whole agree- ment”
- The invalidity of the agreement cannot be cured by the fact that the amended clause reflected the intention of the parties.”
Conclusion
It is evident from the above that strict compliance with section 2(1) of the Alienation of Land Act 68 of 1981 is crucial for the validity of a deed of sale.
Message from the CEO
Rate cut sets property pace
The interest rate cut of 100 basis points supports views that the property market has turned a corner. It is good news for the real estate sector and we expect it to set the pace for the rest of the year, with further cuts to follow.
Feed-back from our franchisees throughout the country already indicates that the property market is lifting its head after the turmoil of the past few months. Figures show that attendance at show houses are dramatically up - the average of seven visits per show day last year has jumped to between 30 and 40 visits for properties on sole mandate in the bigger centres so far this year.
Economic indicators in general are more upbeat, and we expect that the latest cut will be followed by at least 100 percentage points in April.
What this means for consumers is that they now have a golden opportunity, whether they are buying or selling. Buyers who buy now at depressed prices can look forward to lower bond repayments, while sellers can realistically expect that more affordable financing will start underpinning property prices.
As a well-respected brand, Aida has kept its eye on the ball during the recent tough times and has met the turmoil head-on. Our strategic decision to offer training bursaries to all our agents has paid off handsomely and we feel confident that we are ready to achieve great heights this year.
The Estate Agent’s partner in
home financing
The newly established Sanlam Home Solutions offers bond origination services to estate agents in order to pave the way for clients to become home owners.
As an approachable, responsible and re-sourceful company, Sanlam Home Solutions increases estate agents’ chances of securing home loans for their buyers.
Home loan industry
Within the current economic climate the banks have become loan resistant mainly because of expensive cost of funding and bad debts. Consumers in the middle market still want to grow their wealth through asset accumulation, but they are struggling to secure home loans because of stricter credit criteria to qualify for a home loan.
Paving the way for potential home buyers
Sanlam Home Solutions offers comprehensive bond origination services, which includes pre-qualifying potential home buyers and by compiling a comprehensive credit assessment before applying for a home loan at the appropriate financial institution.
Sanlam Home Solutions’ professional consultants are knowledgeable and they come equipped with the skills, tools and information to assist home buyers in applying for a home loan at all major banks (Standard Bank, Absa, FNB, Nedcor and Sanlam Home Loans). These consultants have access to desktop valuations, credit bureau information, current insurance portfolios and collateral values in order for them to properly assess income and expenditure to calculate affordability.
Sanlam Home Solutions provides a service that takes a holistic approach to home ownership. We provide clients with access to a pro-fessional financial adviser or broker who can conduct a comprehensive financial needs analysis and address future and current financial needs for any home buyer.
Benefits to the estate agent
The estate agent will become a lead generator for home loans who will have access to a knowledgeable Sanlam Home Solutions consultant that will “pre- qualify” their potential client for the said purchase and thereby enabling the agent to focus on the selling of property and the consultant to focus on securing bond finance
Agents will be able to offer their clients access to associated value added ser- vices within this process of home buying. (Competitive premiums on credit life, financial planner to do a full financial and needs analysis and advice on collat- eral possibilities to secure bonds)
Estate agents can capitalise on the Sanlam brand which last year was rated as the second most recognised brand in the Insurance category. Thus a very trusted brand to recommend, and get the immediate “buy-in” from the pur- chaser for assistance in securing bond finance
Estate agents can increase their sales volumes from the Sanlam client base who will be informed of the new Jigsaw alliance, and that they can now approach Sanlam’s in-house estate agents with all their buying, selling and renting needs
Commission to estate agents will always remain market related within this vola- tile and changing industry.
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Barberton Mountain Bike Race
Die Barberton Mountain Bike Race word aangebied deur die Rotary Klub. Dis deel van 'n reeks bergfietsrenne in die land. Daar was hierdie jaar vier renne: 10km, 45 km, 75km en 120km. Al die geld wat ingesamel word word aangewend vir welsynsprojekte van die Barberton Rotary Klub. Vanjaar is 1200 fietsryers verwag, maar 'n rekordgetal van 1500 fietssryers het opgedaag!
Dit was 'n heerlike koel dag met baie ligte misreën. Ideale omstandighede vir die fietsryers. Nie so aangenaam vir die mense by die waterpunte nie! Alles was nat en modderig, maar nietemin groot pret. Bykans al die agente van Aida Nelspruit was daar. Dit is die tweede jaar dat Aida Nelspruit 'n waterpunt beman en die geleentheid gebruik het om sommer terselftertyd 'n paar skouhuise gedurende die naweek in die dorp te hê vir die baie inkomelinge. Almal het dit baie geniet en sê dat dit 'n heerlike spanbougeleentheid was, al moes ons so vroeg opstaan!
Barberton is bekend vir sy mynboubedrywighede, maar deesdae ook bekend daarvoor dat van die oudste rotsformasies ter wêreld hier gevind is. Barberton het baie geskiedkundige geboue en stories en is vroeër gereken as toerisme area. 'n Splinternuwe pad tussen Nelspruit en Barberton gaan egter die afstand van 40km tussen die twee dorpe baie vinniger en korter maak en daar word voorspel dat die huismark in Barberton baie gou gaan uitbrei. Heelwat ontwikkelaars is reeds besig met ontwikkelings om die geleentheid te benut.
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