SA property prices vs the world

The global property market is not an easy one to decipher; comparing South African prices to those overseas on some sort of even keel is even more challenging.

Lew Geffen, chairman of Lew Geffen Sotheby's International Realty (and founder of Savile Row Auctions), wrote in a recent article "Keep your money in SA property"  that "research shows that for the R1.3m average cost of a tiny studio flat in central London - a favourite city for SA-based investors - one could acquire an ultra-modern loft apartment in central Cape Town, or a three-bedroom apartment right on the beachfront in trendy Sea Point."

One, you can't buy a three bedroom apartment on Sea Point's Beach Road for R1.3m. It doesn't exist and if it did, you wouldn't want to buy it. And as for a loft, maybe a tiny box size loft with no views and an outside toilet.  I did find an apartment for sale in St George's Mall in downtown Cape Town for less than R1.3mil and it looks very nice in the pics but that is an apartment not a loft.

So what can you buy in South Africa for R1.3m? Quite a lot actually but not in the most sought after suburbs. Obviously, and particularly in Cape Town, position counts and costs.

But who qualifies to buy property for R1.3m? Let's say you have a deposit to put down of R300k and you have funds available for any transfer and legal costs - so what will a bond of R1m cost you and do you qualify?  Best place to check is the Realestateweb.co.za Bond Calculator.

A R1m bond at 10.5 % paid over 20 years will currently cost you R9 983.79 a month. Working on the ‘30% of income rule', you would need a combined earning of about

R30 000 to get a bond of R1m, that's assuming of course you have a deposit and some cash to spare. This is also not factoring in any levies or rates or taxes.

Right, finances in place, what's on the market? Note, it is advisable to first get your finances in place before looking - to avoid disappoint - know what you can afford and what the bank is likely to lend you.

I scoured the internet for properties in Sea Point, actually for a three bedroom flat on the beachfront for R1.3m. The only one I found was on Sotheby's website (Lew Geffen's company). The next time I looked the flat was off the site and the agent had responded to my web query, telling me the property had no views, was in poor nick and sold two months ago. The buyer was happy to buy as an investment with an existing tenant in place.

There are plenty of properties for sale around the R1.3m mark. In Green Point this gets you a choice of one-bedroom apartments, occasionally two and maybe three in very poor condition without any views.

Sea Point is pretty much the same but less quality for more money than Green Point. Yes, Green Point has a big white elephant parked in its midst but I'm afraid even the best copywriter can't sell a "stadium view" over a sea view. Well, maybe in Gauteng.

Same goes for Hout Bay where you can get a small two bedroom home in a security complex for close to R1.3m although if you want real comfort with real views in a desirable area, you will have to spend a fair bit more than that.

Gauteng side, I spotted "a luxurious home" with three bedrooms and a double garage for R1.35m in Edenvale. Sounds nice. What's Edenvale like?

In Soweto R1.2 m or less buys you a house in the heart of Diepkloof. Ext Phase and in KwaZulu Natal, R1.38m gets you a well-maintained flat in a secure building at North Beach, Durban.

But what will your R1.3m get you overseas? In London SE1, for the princely sum of £110 000 pounds gets you a mid-terrace house with two bedrooms, "updating needed".

In Nottingham City Centre a one bedroom apartment is on offer for £109,000 and in Sydney I couldn't find anything under 200 000 Australian dollars.

Searching is fun, as is the comparison, no matter how crude the method. You can do your own house search here and The Economist has a very useful tool, which you can use to compare countries' house-price data over time. Makes for interesting reading, particularly when read in conjunction with this article on Real estate cycles and why they matter. Apparently these cycles are easy to predict - they always are after the fact.

Geffen makes the point that "South African high-end properties are still well priced in world terms - and that the local market also offers arguably better potential for gain at the moment than just about any other, because of the country's relatively stable economy and expanding middle class." I agree with a lot of what Geffen says and I like his optimism. I just think he need to visit Cape Town a little more often.

Some useful Realestateweb tools (click on the hyperlink) to help make up your own mind:

These property value reports and tools are excellent to get a bird's eye view of a particular area, what is selling and where. There is also a guide to the market value of your property by seeing similar sales in the area.

• Automated Valuation Report (R50.00)

The Online Property Assessment is a comprehensive report that helps buyers and sellers to establish the fair value of a property

• Property Report (R35.00)

The Property Report is a ‘light' version of the Valuation report.

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Comments

 

responses to this article

Comparing to London is just crazy London is a world financial centre - South Africa is a 3rd world outpost (a nice one to be sure - but 3rd world nonetheless) In SA it's easy to develop and expand supply. In London it's almost impossible. That means that supply is always . .more limited, and so prices are held up. Cape Town should rather be compared with Rio or BA, where property is MUCH cheaper. . .less by Mike R on October 26 2009, 09:36 Find this comment inappropriate? Report it

Building a house Still costs what it costs - you can't get it cheaper than cost. by pete on October 26 2009, 10:06 Find this comment inappropriate? Report it

fairest cape have been trying to find a decent (not luxurious) mid-size (3 bed) home in the cape town city bowl - have yet to see anything advertised below R2,6m. and the entry level houses are all "great investment opportunity; needs some TLC" etc etc. who on earth . .more can afford that? . .less by meetjoeblack on October 26 2009, 10:16 Find this comment inappropriate? Report it

Here we go again .... The cockroaches attempting to talk up SA property! It is about time that the "Soothsayers" start taking important factors into account regarding SA property, viz. burglaries, highjacking at the entrance gate to one's property, high incidence of crime, etc. by Compadre on October 26 2009, 10:26 Find this comment inappropriate? Report it

Crazy Comparisons I often go to, and just came back after a month, touring and staying in the UK. Obviously scrutinizing property opportunities was one of my favourite past times. A 'mid-terrace house with two bedrooms' does not exist in London. I suggest that such ads . .more refer to two bedroomed, 2nd floor apartments. Now, in the lower parts of Earls Court (London, not central) you might get a 110 sq.m. apartment for £680,000; if you are lucky. Same in the surrounding cities, like Cambridge. £110,000 will not even get you a 2 bedroom semi-detached 'home' in one of the smaller towns of Norfolk, York or Lincolnshire. There are some 50 sq.m. props in the 'less desirable' western parts of London for 110k, but you will get £80 per week rent and continually fight to keep the walls from dissolving. Forget about the ads, Barry. Go spend some time viewing (say just 50 or so, for now) properties first hand and it will become very clear to you that the only property that R1.3 will get you in the U.K. is some very dilapidated flatlet on the wrong side of an old fishing village somewhere in the east of Kings Lynn. Here (SA) you can get a brand new 170 sq.m 3 bed, 2 bath double garage house on a 500 sq.m. stand; albeit not in Clifton or Houghton. Crazy Comparisons ... . .less by Etienne on October 26 2009, 10:35 Find this comment inappropriate? Report it

@Compadre - What the hell? Please address the issue. UK, US and Australia also has crime buglaries etc. This article is not comparing crime levels in different countries... Grow up. Common sense 101..... Dumb Cockroach. You are intentionally talking this country . .more down and I wonder what do you gain out of it. . .less by Biased on October 26 2009, 11:22 Find this comment inappropriate? Report it

@etienne so true mate, lived in wimbledon for a few years and small 2 bedroom 1 bathroom flat was sold recently for 425000 pounds which is over R4.8 million at the current strong exchange rate. if u compare what you can buy in plettenberg bay for the same price . .more its insane, but then again in london i dont have to worry about malema taking my property away from when im done paying for it... . .less by Billy on October 26 2009, 11:24 Find this comment inappropriate? Report it

meetjoeblack Looking for 'home in the cape town city bowl' is a little bit like looking for a car from a German manufacturer. Perhaps you can switch 'brands' and then you will get something affordable, no? I think this is exactly why the perception exists . .more that property is expensive. The delusion that its our right to own property in 'decent places' (overpriced suburbs). . .less by pete on October 26 2009, 11:31 Find this comment inappropriate? Report it

Nice realistic article! The Geffens of the world simply like to talk up there industry and fill columns in papers. The solution is you can rent a great place in Cape Town for R10,000 - R15,000 leave all the worries and the mortgage to the owner and put your money into property . .more stocks... . .less by Frikkie on October 26 2009, 12:02 Find this comment inappropriate? Report it

One point that is overlooked.... is the fact that SA property or any property in Africa should trade at quite a marked discount. You don't know what the situation in these countries will be like in the next 5 years let alone the next 20. Just take a look north of us. by Bear on October 26 2009, 12:24 Find this comment inappropriate? Report it

UK prices are a bargain right now They are ahead of SA in the cycle or so we are told... and they are in the height of their property price crash, or so we are told. So they are just giving away houses, or so we are told. 50% off since the peak. or something like that we are . .more told. So we are comparing UK bargain prices vs SA boom time prices. But just listening to Etienne who has just come from there what we are told may not be the truth ? In that prices in the UK have not dropped as much as we are told.... . .less by bubblehead on October 26 2009, 12:50 Find this comment inappropriate? Report it

Oh Please! You earn more in the UK and your interest rates are lower - Just like the USA. So propertyneeds to be more expensive. And here we have the 3'rd word issues of uncertainly and crime. Go write omething informative! by Observer on October 26 2009, 13:51 Find this comment inappropriate? Report it

SA property overvalued Compared to other third world destinations Cape Town is very pricey. Political risks are high-Julius Malema does this country an enormous amount of harm in the property market by his rabble rousing comments( meanwhile his robbers den is in . .more Sandton and drives a fast getaway car) Look at commercial property shares-very little foreign ownership-why...the ANC gang!! . .less by SAM on October 26 2009, 14:30 Find this comment inappropriate? Report it

absolute drivel wow, i have learned absolutly nothing of value from this article. What does barry do for a living and what makes his point of view on this matter worthy of this article? please enlighten me. it sounds like a laymans view of the property world. Please . .more can articles like this incorporate more facts. . .less by tashauna on October 26 2009, 14:31 Find this comment inappropriate? Report it

London I currently live in London and there is not a chance that you'll find a two-bedroom house / flat in central London e.g. SE1 for £101 000! by Michelle on October 26 2009, 14:47 Find this comment inappropriate? Report it

It would be more accurate to measure against bond repayment of X amount per month Our interest rates are treble that of the UK, US etc. and our insurance costs are way, way beyond them too by GungetsTuft on October 26 2009, 14:59 Find this comment inappropriate? Report it

Global property http://www.globalpropertyguide.com/index.php Use this URL and do your own research/comparisons. There is a ton of info available on this site. This article is utterly useless. by AA on October 26 2009, 16:50 Find this comment inappropriate? Report it

i compared CT to the following: Mogadishu: CT more expensive Luanda: CT cheaper Kinshasa: Same as CT So there we are- we fairly priced. Comparing apples with apples now that is by charlie on October 26 2009, 17:38 Find this comment inappropriate? Report it

Does nobody worry about the absurd entry costs for buying RSA property? AND we have to pay rates that increase randomly and often accouding to my rates bills . Ireland has NO property taxes and neither does Malta. I am sure their are more countries with this attraction. UK has the council tax ( at about the same as a . .more junior secretary's monthly wage) and that is paid by the occupying household ,not the owner. . .less by Free the Rest on October 26 2009, 17:41 Find this comment inappropriate? Report it

Affordability House prices are determined by supply and demand. Supply is determined by demand, demand is determined by cost and affordability. If bond costs dropped to 2% in S.A., house prices would double. If bond prices went to 25% in the U.K. . .more prices would drop by 50%, especially if their bond costs were not tax deductable. "It is the market, Stoopid!" . .less by Ivan Moor on October 26 2009, 18:28 Find this comment inappropriate? Report it

It's about a little more than money and cost... In London its about supply and demand, which to alage part is created by lack of space, good schools, and good transport links... So what can you realistically buy for £110 000, not even a 1 bedroom flat, you'll get a studio! A 3 bed mid terrace . .more in a good area, (Zone4 post code KT4 7 for those unfamiliar with London post codes, that is South West London..), for schools and transport is currently R3, 558, 100 But when the £ crashes, which is highly likely, the same thing will cost you £2, 691, 000 - The best you will get a London property for (3bed 85sqm with a 70ft garden...) . .less by JWise on October 26 2009, 19:43 Find this comment inappropriate? Report it

On the ground looking Currently live in London- Agree with Jwise and Michelle, no way, no how, will you find a 2 bedroom flat in London for that little - let alone a 1 bed.You're looking at a minimum of £250k for a 2 bed- even ex council flats go for more than that! by Expat on October 26 2009, 21:29 Find this comment inappropriate? Report it

Sydney property I recently moved from SA to Sydney. In SA I lived in a first class property 10 minutes (25minutes in traffic) from the Sandton CBD. I had 2000 square meters of land, an 800 square meter house, an enormous pool, domestic accomodation for 2 . .more employees, a view, an enormous mian bedroom bathroom, fully appointed home theatre etc. I sold my property before the market got really tough in SA and arrived in Sydney and bought a property at what might have been regarded as 'the bottom' of the market in April. The full sales price of my unbonded Sandton house served as a 30% deposit on my new Sydney property. Half the size, half the finish, two garages instead of four, small main bedroom, no home theatre and 25kms from the CBD!!!! Takes 25minutes to get to the office in no traffic and 2 hours with!!!!! Now the scary thing is that property in Sydney has doubled over the last 8 years, is up 8% since April, while the Rand has tanked from R4,20 to the AUD to R7 over the same 8 year period. You tell me where I should have invested in property over the last 8 years. . .less by Observer on October 26 2009, 23:24 Find this comment inappropriate? Report it

average salaries, average house prices and over priced houses Average salary in UK 23000 quid (R 280,000) - 3.5 times that is R 970,000 - so that should be the average price in the UK - it is not so house prices will drop further. Interesting, the average house price in SA is about that amount (R 970,000) - . .more are average salaries R280,000 ? I don't think so, they are much less ... so ... average house prices must fall. Just more evidence that property in the UK and SA are still way too high. . .less by CJ Says on October 27 2009, 08:59 Find this comment inappropriate? Report it

Averages The average human is neither male, nor female ... Average house prices mean nothing. Just an indication of buying trends, not value of property. And a house price index is a massively tweaked statistic, so really quite meaningless for valuation . .more purposes - just a indicator for banks and mortgage purposes. . .less by pete on October 27 2009, 09:48 Find this comment inappropriate? Report it

Wow - fantastic economist website - answers all the questions http://tinyurl.com/y9bayjd Shows the nominal house price increases, the real price increases and the house price/salary ratios of all the major countries. In the nominal prices notice how SA's house price increases rocket high above all . .more the other countries. Notice in the real price graphs how SA also rockets above all the other countries. Notice how Switzerland is almost flat - good old civilised Switzerland - prices go up with inflation just like they should. Japan and Germany have seen their real prices actually fall. Notice in the House price to salary ratio, SA is also up there as one of the most over valued. All in all, the graphs confirm what I have been saying all along - SA is the global house bubble king and our correction has only just started. . .less by CJ Says on October 27 2009, 10:50 Find this comment inappropriate? Report it

Lies You got it wrong CJ & so has the Economist. The population demographics are disimilar in the various countries...in addition, I think the population sample for wage statistics was not drawn from the same data base as for the house price data. i.e. better . .more to compare Sandton wages to sandton real estate....heard of that?? . .less by CJs Landlord on October 27 2009, 12:41 Find this comment inappropriate? Report it

http://tinyurl.com/y9bayjd You cant use incorrect or irrelevant data to come to a correct conclusion - no matter how sexy the result looks. If its based on incorrect data its useless for any purpose. So depending on the period selected, you can get any result you want and get the . .more graphs to show you anything you like. I especilly like the SA figure from 1999 to 2009 (last ten years) - shows that SA is a great place to hold property! Hey just interpret it in any way you like. Pity the graphs dont go to 2012 .... . .less by pete on October 27 2009, 12:47 Find this comment inappropriate? Report it

I see So "CJs Landlord" thinks he knows better than one of the world's leading financial magazines - well there you go, can't argue with that, he must be right. And pete thinks that because the bubble in SA between 1999 and 2009 was the largest in the . .more world, that means SA is a great place to be investing in property. Pete also thinks he can make the chart say anything - OK let me take him on - show me how to make the chart indicate that property in SA is going to be a winner in the next 5 years. Come on guys, I know you property chaps have a reputation for being a bit dim, but you really don't have to flaunt it quite so obviously. . .less by CJ Says on October 27 2009, 14:41 Find this comment inappropriate? Report it

Charts Nothing personal, CJ Says, but you can change the period to whatever is convenient or to whatever the point is that you want to 'prove'. I have played around and selected a period where SA actually lagged in growth. This was for a short period, but the . .more principle remains - selective use of data is worthless. My argument is one of data: - that you looked at a specific period to show that SA became overpriced rather than how SA experienced good growth, - that you are averse to steep escalations in an index, but dont bother to point out where SA lagged in growth for years, - that you actually compare countries as if there must be some mystical and good corellation in price movement, - that you are using indexes and so the same brush to paint all types of property and property investments when in fact this type of pooled data becomes, by its very nature, worthless when pooled, - that you use indices designed for trending to determine values. By the way, I cannot find any rational information that would indicate that property in SA is going to be a winner over the next 5 years - on the contrary..... . .less by pete on October 27 2009, 15:13 Find this comment inappropriate? Report it

well said Pete, well said! Old CJ has put down his marker that 1999 was the year when property was priced just right. If he is/ was so convinced that 1999 property prices where at the norm I wonder why CJ did not buy back in 99? CJ.... ? I know I bought in 99, . .more made a killing actually now that I look back. So what happened CJ if you are so bright why did you not climb off the fence and buy like the " dim "ones ? But Pete like you say he does not bother to take into consideration the previous lag years... I just wish CJ would get something new to say because its getting kinda boring lets be honest, for all the time we spent educating the lad he should be flying high by now. . .less by Brennan on October 27 2009, 17:39 Find this comment inappropriate? Report it

Investment reward.. Is determined by two simple factors time and risk. Time based reward simply rewards for the amount of time you invest, and risk - well, should reward according to the risk faced... I think South Africa's risk has been mis-rated for years, and everyone . .more talks about what about after 2012 - Let me just say the outlook for the entire world is FAR from certain, so talking about SA outside of any 'normal' emerging market filter is naive. SA's ranking in so many areas will surprise you when looking at the economists publication on country statistics. SA ranked better than Japan in certain governance areas... What I'm trying to get across is that it is time to think like investors without emotion, and judge property in SA the way it should be judged... Fact - what you can build in SA outrstrips any other country in the world, I was recently in Beverly Hills USA, what a DUMP when compared to say Sandringham, or Hyde Park! Crime is so bad in some places in London they want armed police on the streets in some areas, so count your blessings, and be realisitic when 'valuing' any asset! The astute investor will correctly value an asset when no one else sees the value, buy, hold and maybe sell when its overvalued thus making a fortune... CJSays' comments are risk averse, blind and one sided no way to get rich ;) . .less by JWise on October 27 2009, 19:32 Find this comment inappropriate? Report it

Rubin recently said this as a balance to intelligent decision making right now.. "In the short run, what's happening is that there is a wall of liquidity, not just in the United States but around the world, that is chasing assets. It is equities, commodities, it's credit, it is gold, it is emerging market asset . .more classes" "Everybody is borrowing, shorting the dollar, and investing in assets all over the world." "Once the dollar reverses, you need to close your shorts, dump assets." . .less by JWise on October 27 2009, 19:35 Find this comment inappropriate? Report it

@JWise Roubini.... by ad on October 28 2009, 03:16 Find this comment inappropriate? Report it

how stupid are we expected to be Mr Geffen please do some simple sums. Basic food prices are the same, herre and UK. Salaries are about 3 times what they are here and interest rates are less than half. That means that if you live and work in uk, you can afford to buy a house 6 TIMES . .more more expensive and it actually costs you the same portion of your disposable income. Demand is about 20 times higher in UK than here, (location location location)so you should be paying a premium, but in fact you are getting it in my estimation at about 1 third of the cost of buying hear. SA prices are way way way overpriced, given the country we live (yes third world, criime, distance from EU etc etc) and affordability here . .less by douglas on October 28 2009, 10:22 Find this comment inappropriate? Report it

My dear Brennan Unlike you I have no desire to be a slum lord - I wish to buy a home. I didn't buy in the past because it was not the right time in my life to buy. In theory, if house prices rise exactly with inflation, it shouldn't matter when in your life you choose to . .more buy. It seems, looking at the Swiss graph, the Swiss enjoy that benefit. Unfortunately, when the time came in my life that I wanted to buy, a huge bubble had happened in the SA housing market - only a fool would buy at bubble prices when bubbles always crash back to norms in time. For the record, 1999 was the best time to buy, but it wasn't the norm. That would be around 2002 I would say. However, in the past real prices have always returned to the start point of the mountain on the graph, so that is why I suspect we will be overshooting the norm level and going all the way back down to the 1999 level. Only then will we bounce back up to linger at the norm levels. . .less by CJ Says on October 28 2009, 11:06 Find this comment inappropriate? Report it

@ Pete Glad that you agree that there are no indications that SA property will be a winner over the next 5 years. The real graph shows the declining real prices in the SA market in the nineties. It went below the norms and was undervalued, that is . .more clearly seen. But by 2002 that imbalance had been removed. All the increases after that were the market getting increasingly overvalued. THAT excess is what now needs to be wiped out . .less by CJ Says on October 28 2009, 11:11 Find this comment inappropriate? Report it

@ douglas I would suggest that the distance from the EU is an advantage - the further the better! Dont assume your preference for the European way is for everyone. Your oversimlification of living expenses by only mentioning food prices explains the . .more fallacy of your argument and answers your own question, as asked in your heading. I refuse to beleive that you honestly think that people in the UK has 3 times more disposable income than here in SA for the same occupation ... Your quote of 20x greater demand is such a thumb suck sensationalistic lie its just not funny! . .less by pete on October 28 2009, 11:33 Find this comment inappropriate? Report it

@ JWise Well said! by pete on October 28 2009, 11:34 Find this comment inappropriate? Report it

Interesting... First of all, I finally understand why CJ is so negative about where our house prices is going. He is not an investor and he only wants to purchase his OWN home when the time and market is right, so as to minimise his risk of losing money if the prices . .more decline. This makes sense - for him and people like him that only want to own their own home. CJ's advise therefore is probably good advise - for people in his situation. HOWEVER, his advise makes no sense whatsoever for investors and taking it, even if you are only thinking of buying an investment property would be akin to taking legal advise from your domestic. Listen to people like Jwise, he makes sense! BUT CJ, I bought a house in Melville, Jhb at market related prices in '99 for R150 000. You cannot find a house in Melville now for under R 1 mil - do you honestly believe that the value of this house (R1,4 mil) will actually drop to R150k IF the "bubble" bursts? That's where you make you're mistake CJ - astute investors buy in the right markets, at the right time and at the right price. Even if the markets tank and it loses 50% of it's value, it's still worth MUCH more than what I bought it for AND I received rent on it for 10 years, which paid my bond off 3 years ago. . .less by Bearded Bandit on October 28 2009, 14:05 Find this comment inappropriate? Report it

Article By the way, I had an offer on my 32m2 flat in Nottinghill, London for 550 000 pounds about 2 months ago. Do you know what is worth now, Barry? 50 000 maybe? Unbelievable! by Bearded Bandit on October 28 2009, 14:09 Find this comment inappropriate? Report it

property my king bought a seafront plot in Stilbay in 2001 for R85k...sold it in 2007 for R1,1m. Will buy it again for R85k but I am sorry CJ...I heard that bubble talk 10 years ago as well when prices were still low. If I did not buy then......I would have less than a . .more tenth of my wealth.... Bearded Bandit...I can hear you know waht u talking about. Is now good time to get as much foreign currency as possible. I have invest heavily in St james land which sells plots in the UK(windsor to be precise). I want to start to get rid of Sa investments as I see the rand diving at some stage ....widening the property gap even further. What do you think . .less by william@cj and Bearded bandit on October 28 2009, 16:26 Find this comment inappropriate? Report it

1 thing is for sure CJ For you it will NEVER be the right time to buy.. dont hassle life goes on and we need some people to be tenants their entire life, just like you.. Regarding the Swiss, perhaps the reason for their low inflation was due to the fact that their . .more currency was backed by gold? think about it.... Currencies backed by government promises by nature are inflationary. When the global inflation wipes you out CJ, just remember i told you so, all the while the leading indicator for inflation (the price of gold) puts gold at all time highs above $1000/oz... whos having the last laugh? . .less by brennan on October 28 2009, 23:01 Find this comment inappropriate? Report it

@william Thanks for the complement, william, but I am by no means an expert. I only have my own investment plan that I constantly tweak and that has brought me good fortune over the years. I myself have only 2 properties in the UK and 2 in Germany, one . .more of which is a personal residence. Property prices in Germany has been stagnant for quite a few years, but at least they have tax incentives for owning property. The UK is a totally different market and gave phenomenal returns in the last few years. The question, though, is what sa investments? If it's property, why don't you bond it to an amount equal or slightly less than the rent you are receiving and take the money offshore to invest further? That way you still have the asset and the money. This is dangerous though in the wrong hands and you need to be very dilligent not to overcommit yourself. I also don't believe the Rand is going to "tank" anytime soon. We have some idiots in government, but so far our economic policies have been very good. (Also remember in June next year well have an additional 500 000 people wanting to buy Rands), so you should still have a decent window to make your move. . .less by Bearded Bandit on October 29 2009, 17:09 Find this comment inappropriate? Report it

@ BB Did the salaries of the people in Melville rise 700% over the same period - thought not - so why should property. You think it is acceptable for property to escalate way faster than inflation but any mention that it could fall just as fast and you say . .more people are mad. It is simple - property keeps track with inflation - any excess or deficit is balanced out. Don't fight it, accept it, that is how it has been for centuries. We have been through an enormous bubble - it was normal - when will the property guys get that into their fat skulls. It is not happening again. At least, not in our lifetime. . .less by CJ Says on October 29 2009, 23:34 Find this comment inappropriate? Report it

@CJ You are missing the point, CJ. Averages are for losers and lazy people. I don't do average. Warren Buffet doesn't do average and neither does Trump or any other wealthy person on earth. These people rise above average and that's what makes them a success. . .more They don't do average investments, they find exceptional ones. That's what every successful property investor does. We don't buy average... To answer your question directly: Yes! Reason? As Melville became "trendy", the previous deographic started selling and cashing in on the CG they received on their houses. New people moved in with higher salaries and started renovating and upgrading. Suddenly they had kids, or whatever, sold, cashed in on the CG and new people moved in with even more money. And so the cycle continued... So why, oh why CJ will this area go back to what it was 10 years ago if the demograhics has completely changed? That is the problem I have with all your graphs, etc. It might be accurate from an "averages" perspective, but it doesn't take the micro economics or dynamic of a specific area into account. And that is part of the reason successful property investors are just that - successful. . .less by Bearded Bandit on October 30 2009, 14:41 Find this comment inappropriate? Report it

Lew Geffen needs to visit London too R1.3 million for a tiny studio in the centre of London? I don't know what he is smoking but I want some of it. For a studio in the centre of London you're looking in the region of £350,000. by Dan Jacobs on November 01 2009, 02:58 Find this comment inappropriate? Report it

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