From Andre de Villiers - Chas Everitt Cape Town Regional Chairman (South Africa):

Chas Everitt offices in the Western Cape South Africa have reported an increase in returning South Africans from abroad due to the poor economic circumstances overseas.

There has also been a marked downturn in South Africans selling because they are emigrating. Both of these factors are having a positive effect on the property market and returning South Africans particularly are stimulating the already strong rental market.

While there still seems to be substantial pessimism about economic and political conditions in South Africa returning South Africans are basically at one that conditions are worse overseas with most of them confirming a desire to rather face difficult times here than abroad. Jack Mullin who recently returned and rented a property through Chas Everitt in False Bay mused that it was like wanting your mother when you are not feeling well, "it may not be rational but it just feels better" he said.

Most returning South Africans are from tthe UK and Ireland where they warn those planning on going abroad to work to think twice. Jobs are increasingly scarce and there are signs of growing intolerance in the UK towards foreigners that are seen to be taking jobs away from locals - particularly more menial work.

A number of sellers who had initially planned to emigrate have postponed plans and taken their properties off the market as it has become increasingly clear that their expected prices are unlikely to be achieved.

I will ascertain the degree to which this is being experienced nationally at our annual company convention next week and will edit this post on my return but I will not be suprised if it is indeed a national trend.  It would also be interesting to hear from other Realtors in emerging markets if a similar trend has been noticed.

Andre de Villiers

www.ChasEveritt.co.za

www.CapeTownProperty.com

After over 20 years in Cape Town real estate I am often asked by new abd not so new agents for some promotional ideas thgat are cheap easy and above all cost effective!  These are my Top 5 favourites that any agent can easily manage and have fun with;

1)  My New Address - Business Cards for the Buyer
Make a small pack of 100 business cards and print them on your printer on light card.  Each card will feature a picture of the house the buyer bought with their names and Our new address and contact info. At the bottom of the card discreetly put the words; "We bought our house through Andre de Villiers of Chas Everitt False Bay - 0832300549"  Don't take over the business card with your own info as you will decrease the chances of the card being used.  If you like the idea make a pack for every member of the family - people love to use these!  What also works quite well is to use "The Smith Family are Moving" as a heading, then the card can be used by all - the kids go crazy for these!  You will find that it will be worth your while having these made properly at a local printers - you will never get your name out there cheaper and there are so many special business card printing offers - it's really cheap!!

2)  A 2008 Calendar with a pic of the Owners home! 
With Publisher (part of the Office suite) and numerous other DTP sofgtware packages you can easily create a wide variety of calendars and again use a pic of the clients house.  Again put your details in with company logo a little more discreetly then people value it more.  You could do this as a very effective canvassing tool.  Get an assistant if you need and do one street at a time - take all the photographs noting the addresses and hand deliver a laminated version of their own calendar with some magnets on.  They are guaranteed to make the fridge!  Some ideas:  Why wait till the end of the year? Start a mid year calendar July2008 to June 2009 - Great idea is to include an inset of the family pet?

3)  Register a local domain while you can; ie; www.constantia.co.za
and if that's taken try www.PropertyConstantia.co.za or something else that makes sense! like www.ConstantiaInvestments.co.za or www.ConstantiaHomes.co.za or www.ConstantiaHouses.co.za etc  
If you don't know how to run a website just get the company you register your domain with to point it to your office website.  Maintaining a website is a fun hobby and it can pay for itself. You can sell some ad space or offer some free ads to clients?  Take a look on Google and search "Constantia Property" and see how well I come up - wonder why?

4)  Write a press release! 
It is so easy to create a press release on what is going on in your area. Local papers are hungry for free editorial and you have easy access to what's happening in your area.   Are prices up - why? Are rentals strong - why? Golden rule - never write like an add but quote yourself as an area specialist!  Never make comments on behalf of your company without permission though!  Your broker may have to take responsibility for your press releases so best to get these approved before sending them to the media!

5)  Do a Survey! 
Want to make a big quick impact and avoid any 'cold' calls - well then call with a reason! If there is a local 'issue' that's what I call 'safely controversial' set yourself up at the phone with six good questions to which you can get a "Yes", "No" or "Undecided" answer to, and start calling.  Remember it's about getting your name out there so your introduction and your research / survey tells people you are professional - after all surveys are what professional people do!  People love to give their opinions don't they? Here's the real killer; you get to ask "Do you want a copy of the results? BINGO you get permission to email them and get their email address and once again have your smiling chops in their face! Killer 2: Send your survey results to the newspaper.  

Please note this was written for a South African reader so the seasonal references to cold weather may seem a little odd and there are regionally specific comments but the rest may be of interest to some readers :-) 

At our weekly office meeting it came out wrong! It was supposed to be "us agents" and it came out "stagents" but in this market it sounded apt as the winter lethargy and market blues make us all feel a little stagnant.

At this time and in this market there are good reasons to get up and go unless your get up has gone! 

Firstly - The ratio of agents to sales is improving by the day.  Every week another real estate office seems to be closing around the corner and every week we hear of more agents than have decided to go try their hand at selling something else.  Yes one has compassion, but this is a process of natural selection. Eat or be eaten! 

Secondly - our  real estate industry has finally introduced new measures that will require new entrants more comprehensive training - a great advantage to those that are already in!  The last ‘old and easy' board exam was held last week Friday and it's clear that fewer new agents are going to try real estate when they will now - at long last - be required to undergo and more thorough and meaningful training regime!  This means less that when the market turns there will be fewer people jumping on the band wagon. 

Thirdly - Those real estate companies that have the brand strength to lower operating costs by sharing overheads and maximizing discounts have a great advantage over the less established brands and the Mom and Pop shops in real estate so the recruitment opportunities are obvious.  Now is the time to beef up your team - there are strong individuals out there with weaker brands and operators that are making financial cuts in the wrong area - their marketing!

Fourthly - Now's the time to show the public you are different and that you are the one!  There are many creative ways, without spending a great deal of money, to get in the public's face in your territory as other agents dive for cover.  Get out there and expose yourself!  Hold some "Selling in a Buyer's Market" seminars - free hot soup and rolls - ok maybe Gluwein would work better in this weather - but show people that you are their solution!  

Let's be brutally frank - would there be a problem right now is there were 50% fewer estate agents in your area?  Guess what - it's happening in front of our eyes.  The opportunities are there and will increase by the day!  For those that can see themselves through these challenging times the rewards will be great.  As the surfers say, "when the wave breaks don't be catching a tan on the beach!"

PS:  Today gold hit $1000 an ounce and the Rand strengthened to R7-70 to the US$

Be Professional & Tell it as it is!

Andre de Villiers - Blog entry:  Sun 13 July 2008

The client is not your friend! Just like the family needs their doctor the family needs their real estate agent to 'give it to them straight' and yes - with compassion when it's needed.

Today I came back from visiting my agent's show houses in my area, and the one property I called in on was way over what it should be on the market for - even when times were on the seller's side!

It was clear to me that my agent who is an enthusiastic charming and polite lady is having a problem telling the seller what she needs to hear. The seller (who has already complained about the size of the display ad we gave her) has over capitalised on the property and maintains a very personal attachment to her home and has a high regard for the value of her improvements. My agent needs to take the facts of the market and equate them to the selling price of comparable properties but I see the problem - the seller clearly does not believe her house is comparable to any other property in the area.

There is no easy answer to over capitalised properties but one thing is to ask the seller that if they knew when they were spending the money that they would be selling would they done so? The answer is hopefully "no" and then the follow up question of course being "why?" and hopefully the seller then says something like "because we probably won't get our money back". Hello!

Some fixtures can be removed and taken by the seller to their next property. Encourage this as it starts a process of real quantification of the values as in many cases the real value to the subject property for the item is very little as it is a matter of subjective personal taste and preference.  This property for example had three precast water features in a tiny garden and encouraged me to find out where the loo was after being there for two minutes.  Removing the item from the sale will allow the seller to maintain some 'victory' in the price adjustment and may be a great relief to there buyer!  For the seller it allows them to rationalise a drop in price. Quantifying the second hand value of items also gets the seller to start looking at the itemised value and not the total package that seems to encourage the overwhelmingly optimistic comparison of their home to the next door neighbour's property!

The point is we need to be firm on competitive pricing or we do the seller no favour at all. Too often estate agents are overly concerned with the seller's ego and think that if we do not share their 'dream vision on price' they will think we are unenthusiastic. That's like going to the doctor when you have tumor and respecting his professionalism because he chooses to go with your opinion that you just have a headache when he knows better.  Is that the type of doctor your seller wants?  Ask  them! 

The vast majority of sellers who are over priced know it! They are playing a game and they have you to play with!  As long as the agent 'plays the game' we encourage (at our and our company's great expense) everyone to waste their time and to lose valuable selling opportunities by driving potential buyers into the arms of the house and agent around the corner!

Not being truthful with our over priced sellers is a dishonest disservice to them and to ourselves and nobody has anything to gain.

Andre de Villiers - Chas Everitt International (Southern Suburbs and False Bay) Cape Town South Africa

Upgrading in a Down Market

The currency symbols may need to be changed but the principle's the same!

Andre de Villiers (South Africa) Blog - Sunday 13 July 2008

We are all familiar with the saying, "A rising tide lifts all boats" and the truth is the reverse applies just as well.

Sellers in a depressed market can be left with little comfort and it's hard to find a silver lining for a financially stressed seller who is selling and downgrading but this does not apply to the seller that plans to upgrade.

For those who can afford it, it could never be a better time to upgrade and it's simple maths but most sellers don't see the advantage to them when they buy because they are so intimately involved with what they have to sell to move on they can't see beyond the emotion of their selling price.

The agent needs to spell out that selling in a strong buyers market has many opportunities to the upgrading buyer.  Let's take a simple scenario of a seller who is selling for R1 000 000 and buying for R1 750 000 and let's say the estimation is that prices are 15% down on what they were, then the R1 000 000 house will sell for R850 000 (a loss of R150 000 to the seller) but as the R1 750 000 house is going to sell for R1 487 500 (down R262 500) the upgrading buyer scores a R112 500 - 'thank you very much!'

The key to this is obviously for the seller to put himself into the strongest negotiating position he can, and that is a cash buyer needing a modest mortgage finance.  You are not in a strong position if you are still trying to buy up with a 'subject to sale' contingency!

Increasingly we see sellers who missing the boat and the opportunity to move onwards and upwards because they are so fixated with not selling below a increasingly mythical target!

While we accept that the price of oil, gold and equities rise and fall we tend to fight so much harder against the reality of the real estate market's moves.  With all the readily accessible data available to home sellers (and buyers for that matter) the obstinate resistance to new pricing does not make sense but it's the confusion between there value of the property and the value of the home.  Get the seller to separate them more clearly in his mind and realise the home goers with them and we are 90% of the way to letting go of the emotional obstacles to more realistic pricing.

Marketing South African real estate internationally remains a committed focus of Chas Everitt International, but the leading national property group is now bringing the world of international property investment to South Africans.

The launch of this venture is well timed due to the convergence of a number of factors, chief amongst these being;

• the expected further increase in our allowance for overseas investment (currently R2 million for individual and R4 million for family)
• the substantial growth in real estate equity enjoyed by South Africans in their properties
• the positive attitude towards real estate investment resulting from a long boom period
• a weak dollar

Chas Everitt's research shows there is significant numbers of potential investors keen to investigate real estate investment opportunities in other countries, particularly at a time when the South African property market has shown signs of cooling. In addition many with property portfolios are questioning the wisdom of having all their real estate investments in one country. In addition to well selected investments resulting in a substantial return on investment a property purchase can potentially be a vehicle to acquire residency in another country, an attraction option to those interested in acquiring a second citizenship.

CEI Overseas Properties will focus on properties that offer the best investment potential in line with the needs of the particular buyer. Catering either for individuals who wish to acquire a lifestyle investment (a property primarily for the use of their own family and friends) or a focused investment where rental returns and capital growth are the dominant considerations.

An Investors Club will also be structured to manage and facilitate the collective purchase of properties either through the popular fractional ownership structure (restricted to no more than four owners i.e. a substantial 25% share) or a share in a property owning company that will own an international portfolio of property investments.

A well established and popular trend in Europe, investment in a second home has been a real estate phenomenon over the last ten years, a boom that has grown with the enlargement of the European Union. South Africans however, were effectively denied an early opportunity to invest in popular European markets due to the low value of the Rand, as well as legal and financial restrictions at the time, but there are new and exciting developing markets that now offer excellent opportunities such as Brazil, Argentina, selected Caribbean countries as well as countries in Eastern Europe.

There are also African countries that deserve attention including Egypt, Morocco and Mauritius. More costly favorites in the Mediterranean will be available through an exclusive partnership with one of Europe's largest specialists in the region, MASA, with properties in Spain, Cyprus, Italy and Turkey.

CEI Overseas properties will be launched on Wednesday 20th February 2008 at the Mount Nelson Hotel in Cape Town. A useful website OverseasProperties.co.za is already online with a growing selection of property investments and information.

For more information contact Andre de Villiers or Maxine Ross at 021 673 1520 or e-mail: info@ceioverseasproperties.co.za

Having just returned from my fourth NAR over a period of 12 years it amazes me how the term international is still used so liberally in the US in names and descriptions when it really does not apply at all.  Having an office or representation in Toronto Canada hardly makes the brand or product international!  I call it the World Series syndrome where the the name is hardly representative of the reality of the participants or global footprint!  I actually spoke to one rep who used the word international in his name and he very proudly told me that it was because they were going to open an office in Hawai! (Hello!)

Anyhow - the reason for being so irked is that for those who live in the far flung reaches of the planet (like Cape Town South Africa) it is so dissapointing to go over to nAR and get excited about so many great products and tools for our real estate industry only to discover (sometimes after buying the product or service) that for some reason or another it is not suitable or completely adaptable at home!

Take this blog site for example!  It's great and I have to sign up under New York because their is no country choice - pick a State (any State) Hey I love New York so I just adopted it to register - forgive me but we need to get creative living at the end of Africa!  When I buy software very often you are stuck with a $ currency symbol and this is just crazy that the programmers don't allow the Windows settings to provide the currency symbol in the windows system you have chosen.  Then we have to contend with a defaults like five digit zip codes (ours are four digits) and of course we are metric instead of sqare feet and our paper size is different (A4 not letter size) and believe me the list goes on and on!

Hardly your problem I know and you are already saying "the point is?" I hear you - in a country with your size population your web designers and programmers (and that's the correct English spelling by the way) really don't have to give a second thought to us on the global fringe - but we do so much want to play with you!

Yes you do get some fabulous companies that recognise that the rest of the world could still be an interesting addition to their sales market and they are willing to make changes and allow regional customisation and I am always so very grateful!  Top Producer for example (being Canadian I suppose) has been a great example about making their product truly international and there are many small guys out there too and all I can say is thank you!    Now come on Active Rain! Put in a country field and allow me to list myself in my own City and Country and by the way the phone format...  allow an international / country code +27 format please!