Property values are up, and people are ready to buy and sell
One of the solutions that authorities around the world are using to counteract the economic fall-out caused by Covid-19 is to cut the repo rate drastically. South Africa followed this trend with the Reserve Bank by cutting the repo rate to a record low of 3.5% in July 2020. . The prime interest rate in South Africa averages typically around 12.35% (from 1998 until 2020). The highest it has ever been was 25.5% in August of 1998 .
A drastic reduction in the repo rate means that consumers have much lower borrowing costs each month which in turn leads to there being more money left to spend. People are now more inclined than ever to invest this additional money in property. Variable interest rate mortgage bonds are now much cheaper than before. Consumers can either afford a better investment than previously budgeted or are more inclined to purchase to rent out for extra income.
Now is the ideal time for sectional title schemes and homeowners associations to find ways to increase their property and rental values to take full advantage of this buyer’s market.
How to increase your property and rental values
With the interest rate at its lowest in decades, people are flocking to the property market. Community schemes and managing agents should be looking to increase their property and rental values in 2020. To increase their property value these estates and organisations need to invest in professional landscaping, building renovations, security upgrades, general maintenance, and converting homes and buildings to be ‘smart’ and ‘greener’.
If you want to appeal to the growing younger market of Millennials and the more tech-savvy buyers or tenants, then smart home setups will be crucial. Similarly, there is an ever-increasing trend for the need for more eco-friendly or green aspects to homes and buildings. Projects like these can be expensive upfront but will have the long-term effect of increasing the property and rental value exponentially.
Financing maintenance and renovations with Project Loans
Project Loans are the fastest, most efficient and cost-effective way to get maintenance and renovation projects completed. To take advantage of the current market, you need to move fast. Propell provides unsecured revolving loan facilities (Project Loans) to sectional title schemes and homeowners associations so that they can access funds immediately to complete projects like maintenance, upgrades, repairs and energy-saving solutions.
The benefits of funding your projects this way include:
- Funds are immediately available
- You decide when and how much to draw
- Flexible repayment terms of up to 5 years
- Only pay interest for what you use and when you use it
- No surety or cession of levies required
- No penalty for early settlement
If you would like to apply for a Project Loan for your community scheme, contact Propell. Once your revolving facility is approved, the funds will be available immediately. The community scheme can drawdown as required and can select its preferred repayment term. Thereafter you will repay each drawdown in equal monthly instalments. For more information on Propell’s Project Loans, watch this video.