Property News & Information
If you went onto the site yesterday and noticed that it seemed a lot faster than usual, it's because we've just upgraded our servers.
Although the site looks exactly the same, the underlying engine that drives it has been upgraded with the latest software versions and moved to a new set of servers. Quite a tricky process, but we believe the changeover was performed without a second's downtime for www.g.co.za. Testing has also been completed and we found no major bugs (the minor ones were quickly fixed) - but feel free to mail us if you find anything amiss - feedback@g.co.za
It seems our visitors also voted "thumbs up" for the new system with their mouse - there was an increase of about 10% page impressions overnight. With our "Quick Search" and "Search History" search facilities, does that now make us the fastest property search site in SA? If not, please let us know how we can be faster, better, more ...
Posted at 09:14AM Sep 05, 2007 by Grant in General News | Comments[0]
Many people believe that repossessed properties present a great investment opportunity, so its not surprising that periodically we receive emails asking us if we have a repo list or if we know where one can be found. Unfortunately we don't have a dedicated repo list but we do know of a few resources that we've uncovered which I usually include in my replies - hopefully it will be of use to you. To understand the resources, its best to understand the process, so you can see what fits in where:
- A homeowner defaults on his/her homeloan to such an extent that the bank feels the best way to recover the debt is through repossession
- The bank's attorneys apply for a judgement at the magistrates court
- If the arrears still cannot be recovered by this time, the homeowners movable assets will be publicly auctioned
- Should the funds from the movable assets still not cover the loans arrears, then the property itself will be auctioned - Sale in Execution (SiE)
- The SiE has no reserve (minimum bid), so the highest bidder will own the property. However the highest bidder could be the bank itself - if it sees that it will not recover the arrears, it may elect to buy the property and try to resell it itself. The property has now become a "Property in Possession"
When most people are requesting info on repo's, they're usually asking for a list of SiEs, not a list of bank-repossessed properties (PiP above). Comparing the two:
Sales in Execution List
The public auction mentioned above presents a good opportunity to get a property at a reasonable price plus SiE-purchased properties have no transfer duty - a further saving. But as you might expect - with greater reward comes greater risk. The owner will almost certainly be unhappy about having his/her home repossessed and the house may not to be in as pristine a condition as other listed houses. At best, the owner could have been negligent with maintenance (remember the owner is also short on money, so the last thing they'll want to spend money on is a house they're about to lose). At worst there has been vandalism and/or theft from the property. Other downsides to purchasing through SiE is that the buyer will be responsible for evicting existing tenants and will also be liable for a number of expenses from the auctioneer's fees to outstanding rates.
Aside from the above problems, there's a bigger consideration to make - just because its cheap does it necessarily mean the property will be a bargain/good investment. Surely if its a worthwhile property you'd expect it to have the owner to have been able to sell it at a reduced price through more traditional channels (i.e. estate agents) before having to go through the SiE ? So ideally you'd want to find and snap up these properties before they reach the sale in execution phase.
Resources for SiE properties:
Free - Auctioneers: AUCOR , ClareMart , Auction
Alliance , Michael
James Org, SA Auctions Online etc.
Fee-based - There are a number of companies out there that provide SiE lists
Properties in Possession Lists
Some of the banks make their PiP lists available to the public directly: ABSA's list is displayed on Property 24 here and you can get FNB's monthly list direct from their site here. Since there is cost associated with holding the PiP's, banks are usually keen to be rid of them as quickly as possible and as a result prices are usually quite competitive. Banks may choose to market the properties directly (e.g. the FNB PiP list above) or through estate agents etc.
Looking back at the repo process it seems clear that at various stages, the properties will have been marketed through traditional channels like estate agents, so the real trick is to find them as quickly as possible when they come on the market. Gravity has 3 features to help you do just this
- The "First Listed" selection criteria on our Detailed Property Search . When our robots find a new listing, they make a note of the date. The "First Listed" criteria allows you to identify new listings found by the robot during the time period you specify. This will save you having to go through the same results every time you search
- The "Order By" option in our search results pages is perhaps the most useful. It allows the user to sort the results by the date the robot first found the new listings, so results for "Most Recent First" will show you the latest properties first
- RSS Feeds for the larger suburbs, notify the subscriber of new properties found (the method I use for my own property search)
A last thought to consider is that, before the bank considers, let alone actions the repossession process, the owner will already know he/she is in financial trouble and could seek immediate relief by putting the property on the market. Although not quite be at the "desperate" stage yet, he /she will be fairly motivated to sell and a discounted price.
As with all our posts, if you see something you think is incorrect or would like to add something, feel free to submit a comment - that's what blogs are for!
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