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What the proposed tourism bill means for Cape Town's property market
The Cape’s Department of Tourism published the Tourism Amendment Bill on Monday, 15 April. Following its publication, the public has 60 days to submit comment before the act can be signed into law. The bill, which proposes to implement regulations around short-term rental models such as Airbnb, has seen much criticism for its potential to throttle the Cape’s tourism industry. However, it also holds the potential to impact the Cape’s housing market.

According to Adrian Goslett, Regional Director and CEO of RE/MAX of Southern Africa, last year the Cape’s property market already saw prices begin to moderate following an over-escalation in real house price growth that stemmed largely from semigration trends.

“The proposed changes to the tourism bill hold the potential to lower the Cape’s appeal to both foreigner and local investors alike, therefore causing further moderation in property prices," he says. "I am therefore cautious to see what affect this bill will have if signed into law.”
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Fixed vs variable home loan interest rate - what's best?
So, you’ve found a property you love, sent in your home loan applications, and the banks have finally started responding with offers. But wait a moment - one of the offers has two interest rates quoted: a fixed and a variable. What does that mean, and which one should you choose?

Variable-rate home loans
“Variable rate bonds are the most common,” says Leonard Kondowe, National Admin Hub Manager for Rawson Finance. “They’re called variable because the interest rate the bank quotes you, is linked to the prime lending rate. That means if prime goes up, your repayments go up, and if prime goes down your repayments go down too.”

A typical example of a mortgage bond with a variable rate would be granted at prime plus or prime minus, dependent on applicants' overall credit score.
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SA’s residential sector outperforms ‘All Property Index’ in total returns
Results of the latest Absa-MSCI Residential Index have revealed that the South African residential sector outperformed the 'All Property Index' by 1.2% in terms of total returns, registering a total return of 11.2% during 2018. This performance was second only to the Industrial sector which achieved 11.7%.

Amelia Dieperink, Absa Head of Affordable Housing - Commercial Property Finance, says the results indicate the residential sector can hold its own and compete for capital with the more established property sectors such as office, retail and industrial.

Out of the 20 markets producing residential results, as measured by MSCI, South Africa was third behind the Netherlands and Canada. This compared with 17.8% for the Netherlands and 11.5% for Canada. However, South Africa was ahead of Germany, which achieved a total return of 10.8%. Of all the countries assessed thus far, Italy had the lowest total return, at 2.8%.
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Super-commuters boosting coastal and country estate home sales
An increasing number of SA’s executives and professionals are becoming “super-commuters” who travel weekly between their jobs in the city and their homes at the coast or in the countryside, or between the city where they live and the city where they work.

So says Berry Everitt, CEO of the Chas Everitt International property group, adding that for many, “the rationale for this lifestyle is to ensure that while they are working, their family gets to live and grow up in a safer and less stressful environment – often a secure gated estate with its own school or a private school close by, and a host of sporting and recreational facilities that they themselves can enjoy at weekends.”

“They will generally leave home on a Sunday night or early Monday morning and return on a Thursday evening or sometimes a Friday afternoon, depending how flexible their employer is about them working from home.”
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