The United Kingdom’s National Institute of Economic and Social Research has predicted that UK house prices will continue to decline until 2015. Back home, FNB’s May house price index indicates that the real house price growth rate, adjusted for CPI inflation in April remained negative at -2.4%.

This begs the question: is 2015 a reasonable prediction for a turnaround in the local housing market too?

Dieter Deppisch, Head of Property Research at SAPTG (South African Property Transfer Guide), explains: “Local economists such as Professor Erwin Rode have also pointed to a 2014/ 2015 meaningful upward shift in SA house prices. However this is not specifically because of trends in the UK property market. Primarily our market is dictated by local conditions while taking cues from Australia, New Zealand and the world’s largest economy, the USA.”

According to Deppisch, a number of uniquely South African factors are having an impact on the continued decline of the local housing market, including the tight lending criteria, high debt-to-income ratio in consumer households, an unstable job market and high stock levels in many areas accompanied by weak demand. As a result, the construction industry is also under heavy strain.

The start of the interest rate hiking season, expected by early 2012 will provide added pressure to an already embattled property market.

“We are at the bottom of the cutting cycle, at a 38-year-low, explains Deppisch. “The last time homeowners’ paying off a bond enjoyed an interest rate of only 9% was in February, 1974.”

What does this predication of a 2015 housing market recovery mean for buyers, sellers and property professionals?

“It means that we’ll see a trend of renovation rather than relocation, with homeowners choosing to hang onto their properties and take on home improvement projects instead of buying a new home.”

SAPTG’s website is SA’s most comprehensive source of property data with a suite of tools to help property professionals as well as the public monitor changes and trends in the local housing market.

“Estate agents in particular will benefit from keeping a sharp eye on market indicators at a micro level to assist buyers and sellers in making informed decisions,” says Deppisch.

New online facility tracking major property market indicators launched, freeing property professionals from the time-consuming task of trawling countless websites for the vital information they need.

South Africa’s most comprehensive online source of property data, the South African Property Transfer Guide (SAPTG), now publishes a convenient, up-to-date summary of the main economic indicators that relate to the property market. Freely available to the public via its website (www.saptg.co.za), the SAPTG Property Market Indicators page means that interested parties no longer have to spend hours trawling countless websites to find the important information they need.

Dieter Deppisch, Head of Property Research at SAPTG explains, “The data we have brought together will help browsers quickly understand what is going on in the market. One of the big benefits for estate agents is sharing the information with prospective clients. Not only does having this information and sharing it boost their credibility, it enables them to advise clients on the right strategies.” “For example, they can discuss the trends affecting different housing segments and use facts — such as 81 percent of houses are currently selling at below their asking prices.”

Deppisch is quick to point out that the Property Market Indicators page is not just for agents, though. “It’s for anybody interested in the SA property sector,” he confirms. “The page summarises data from a wide variety of sources, including the South African Reserve Bank (SARB), Statistics South Africa, the major banks, mortgage originators and other property consultants and research houses, and tracks whether the various indices have changed and, if so, by how much. All of which makes it an indispensable snapshot for developers, investors, valuers, journalists and even private buyers and sellers.”

Visitors to the SAPTG website can access the Property Market Indicators page via the ‘Market Indicators’ link in the top menu on the homepage (http://home.saptg.co.za/market-indicators/). “You don’t have to subscribe or login to access the data,” verifies Deppisch, “and there’s a useful jargon-busting document available as well, via the ‘need some help?’ link on the page.”

As well as being constantly updated, new sources of information are also being added to the page on a regular basis. “We are always looking to add any information that will make the page even more relevant and useful,” notes Deppisch, “the Knight Frank Global House Price Index will be included shortly, for instance, which will give us an idea of how the local market compares internationally.”

As the current economic climate encourages companies to reduce marketing costs and wastage, the ability of channel optimisation to help companies of all sizes reduce costs and satisfy customers better without eroding already tight margins is proving irresistible.

“Channel optimisation is a strategic imperative for every organisation because customers and their needs are always changing,” explains Dieter Deppisch, responsible for Business Insights R&D at Knowledge Factory. “Dynamically assessing the long-term profitability of each customer enables a company to accurately work out how to reach the right customers, at the right time and in the right place.”

Channel optimisation services improve profitability by simultaneously identify unexploited opportunities, reducing marketing costs and wastage.

Using a combination of statistical models and strategic marketing expertise, Knowledge Factory analyses companies’ existing operations and customers — identifying highly profitable (and unprofitable) customers and using this insight to reduce the cost of reaching and converting them.

A proven blend of scientific, data-driven methodologies and analytical expertise, Knowledge Factory’s channel optimisation service enables any size organisation to establish: what channels to use to reach its customers, how many units (e.g. outlets) to deploy within each channel, and what marketing mix to use with within each channel.

“We start by arming companies with a deep understanding of their customer bases,” explains Deppisch, “their changing needs, their buying behaviour and which types of customers are most profitable in different scenarios. These powerful insights can then be used to precisely align and refine sales and marketing efforts — eliminating areas of wasteful ‘over service’ and exploiting ‘under serviced’ areas for additional revenue.”

At the heart of the channel optimisation service is a complex process that involves collating and merging various data sets. Knowledge Factory analyses and refines the data, interprets the results and converts them into feasible insights that can be applied immediately.

“It’s a difficult challenge for many organisations because customer bases are increasingly diverse and dispersed, making the task of understanding buying behaviours very complicated, and because it is hard to accurately model what it costs to ‘serve’ each customer segment from an operational perspective,” observes Deppisch. “Yet, for most companies, being able to reduce costs and satisfy customers better — without eroding already tight margins — is the key to thriving in the current economic climate.”

It is this unique approach to channel optimisation that has been helping companies successfully re-examine themselves and grow for over 17 years. “Knowledge Factory has built its reputation on providing exclusive, invaluable insights like these to large corporates and SMEs alike since 1993,” confirms Deppisch, “and our world-class analytics team boasts over 100 years of cumulative experience in business insights.”

To find out more about Knowledge Factory’s channel optimisation service or to request a presentation, e-mail Dieter Deppisch at dieterd at kf dot co dot za or visit the company’s website at www.knowledgefactory.co.za

‘Know your Game’ seminar arms property professionals with insights and ideas that will increase sales

The South African Property Transfer Guide (SAPTG) in association with industry partners is currently hosting a free nationwide training seminar for property professionals entitled ‘Know your Game’. Designed to offer industry-specific information that can be used to strengthen the real estate business today, ‘Know your Game’ also arms delegates with tools to take their client service to the next level.  The seminars continue until 21 May at different venues nationwide.

“The seminar is a platform for property professionals to come together and learn valuable insights and ideas that will help secure livelihoods by increasing sales” says SAPTG’s Head of Property Data Research, Dieter Deppisch. Acknowledging the recent recession, he insists that “understanding the South African people, trends and economy more fluently, property professionals can keep themselves relevant and thriving even during challenging times.”  The Development Institute and Training Academy of Southern Africa (DITASA) strengthens the seminar with a presentation aimed at resolving any uncertainties surrounding the NQF level 4 and 5 qualifications. Effective online property marketing is also covered by an expert from Property Genie, one of the largest online real estate portals in South Africa.  SA Homeloans offer their expertise in the field of consumer creditworthiness and explain how agents can ensure their potential buyers will meet stringent requirements when applying for financial assistance.

In addition, the seminar provides delegates with simple answers to complex legal issues. “The seminar is a platform for property professionals to come together and learn valuable insights and ideas that will help secure livelihoods by increasing sales” says SAPTG’s Head of Property Data Research, Dieter Deppisch. Acknowledging the recent recession, he insists that “understanding the South African people, trends and economy more fluently, property professionals can keep themselves relevant and thriving even during challenging times.”

In the spirit of 2010, Deppisch concludes, “know your game, know the rules, and you will score with regularity.”

Anyone interested in the ‘Know your Game’ seminar is invited to book for free on the SAPTG website at www.saptg.co.za.

With the World Cup looming and plenty of post-budget positive sentiment flowing, Dieter Deppisch, head of Property Data Research at the South African Property Transfer Guide (SAPTG), assesses three trends that will significantly impact the property market this year and their implications for buyers and sellers.

1. House prices will rise, albeit modestly

Our SAPTG data suggests that demand for property, while remaining weak, still exists. Some real estate agencies reported an increase in sales in the past 8 weeks, for example, although this increase is off a very low base.

Analysis of the SAPTG data points to a market that is bottoming out, but one that faces a long, slow recovery. Our data is in line with industry projections of 6-8% nominal growth this year, which, along with the predicted CPI levels and stable interest rates, will augment buyer sentiment and should account for more signatures on sale contracts.

While we remain confident that dissipating recessionary factors, together with a slight increase in risk appetite on the part of lenders, will see upward trends in the property market become apparent this year, these will remain modest. Not all areas have recovered and many significant risks remain, including the ESKOM crisis, affordability issues, access to credit and high property stock levels.

2. Property investors will make greater use of technology

Another emerging trend is that savvy property professionals and investors will make greater use of technology to ferret out opportunities in 2010. Predictive pricing models continue to improve in accuracy and enable knowledgeable investors to appraise residential dwellings for market-related prices before calling in the experts — and using these tools is likely to become mainstream this year with the launch of convenient, mobile phone-based real estate valuations services to the public for the first time.

3. World Cup effect on property likely to be local

It’s unlikely that the 2010 World Cup will stimulate a buying frenzy among foreign property buyers. Visitors to South Africa will, undoubtedly, be enamoured by the country’s landscapes, climate and people, but we must remember that these visitors are just emerging, fearful and cautious, from punishing recessions in their home countries.

On the other hand, the World Cup Local Organising Committee (LOC) is hard at work cultivating national pride, which may actually bolster local opinion in favour of home buying rather than renting and lead to additional sales.

Support sentiment with data

For property investors, there are plenty of great opportunities. Some will cash in on the opportunity to provide accommodation to sports fans. Others will wait in the wings and pounce on the bargains that arise as sellers continue to choke on a debt-to-income ratio which, while declining slowly, remains still near the historic high of 79%.

It is still a ‘buyer’s market’ and will remain so in the medium-term. Financially-able buyers are spoilt for choice and blessed with a glut of well-priced properties, which can encourage them to submit offers that make sellers laugh hysterically or gag. So, if you are thinking of selling your property, hanging on for a little longer is likely to benefit you in the long-term.

Whether you are thinking of buying or selling this year, make sure you arm yourself with accurate data and take advantage of the tools that are becoming available, rather than basing decisions on unreliable outlooks, such as World Cup euphoria, or sentiment alone.

A recently announced partnership will strengthen the real estate industry by giving it ‘one voice’, say representatives from SAPTG and IEASA.

The most comprehensive source of property market data, the South African Property Transfer Guide (SAPTG) and the Institute of Estate Agents of South Africa (IEASA) recently announced their partnership. By bringing together the leading online source of information on the South African property market and the country’s largest association of real estate agents, the alliance stands out as a significant step in the strengthening of the industry.

“This partnership reflects our belief that the South African real estate industry is strengthened by having one voice and coming together in one forum,” comments Dieter Deppisch, SAPTG’s head of Property Data Research & Training. “IEASA has been representing real estate agents for 75 years and we encourage every single estate agent in South Africa to become a member of the institute. All SAPTG subscribers will be incentivised to join IEASA if they have not already done so — the bigger our voice, the better”

The partnership means that the SAPTG is now the Institute’s preferred data supplier and will be important in the promotion of information sharing in the industry. IEASA will also be represented at the accredited training seminars presented by the SAPTG around the country, including the upcoming ‘Easy as Pie: Stats for Success in Real Estate’ seminars.

Ken Ralph, Chairman of the National Board of IEASA, comments: “This partnership is a two-way street and we look forward to the opportunity to hold hands with the SAPTG. We have a membership base of almost 30 per cent of the country’s estate agents and we hope to grow this to 50 per cent — to have a bigger voice and to become the official mouthpiece of the industry.”

For more information on the country’s leading source of property market data, visit the SAPTG website at www.saptg.co.za or contact Knowledge Factory directly on (011) 445-8100.

New SMS service makes instant property valuations convenient and affordable

Staying one step ahead in the property game is now easier for all South Africans with the launch of Evaluate, South Africa’s first mobile property valuation service that provides instant property value estimates to any cell phone via SMS.

A fraction of the price of a traditional home valuation, Evaluate costs R30 per SMS, giving buyers and sellers alike an unbiased and informative estimate of a property’s value. Finding out your property’s estimated current market value is as easy as SMSing the word ‘FIND’ and the property’s ‘ADDRESS’ (number, street name, suburb and town) to 32545.

You’ll instantly know what the last selling price of the property was, when it was sold, its estimated current market value, as well as an indication of possible high and low end price range. If this full valuation on the property is not possible, Evaluate returns a quick suburb summary – showing the most recent highest, lowest and average values achieved in the area for a nominal charge of just R1.00. If the address cannot be found then there is no charge. (Standard SMS rates do apply)

Available to everyone nationwide, anytime and anywhere, Evaluate is an easy way to prepare for making an offer on a dream home, comparing your home’s value to listed properties’ in the area, or simply finding out how much that house down the street or at your ideal holiday destination is worth.

Evaluate draws on data from Deed’s Office registrations – the directory of all property transactions – and the proven property market expertise of the South African Transfer Guide (SAPTG).

The tool is modelled specifically for the South African property market, with all its ups and downs and anomalies considered. You are given a confidence rating with the SMS report which indicates the likelihood of the predictions being accurate, based on algorithms and logical calculations and looking at all the available data. A medium confidence rating means that reality should be within 10% of that prediction SMSed through.

For more information about the EVALUATE service, visit www.evaluatenow.co.za

New partnership between Knowledge Factory and MapIT enables marketers to keep pace with our rapidly changing urban landscape and analyse opportunities available in all areas, including informal urban and suburban developments

Insights company, Knowledge Factory, has upgraded its Enhanced Spatial Platform (ESP) as a result of a new partnership formed with best-of-breed map supplier, MapIT. The upgrade allows marketers to analyse the huge number of infrastructural, commercial and residential developments currently underway across South Africa, without having to wait for them to be officially ratified.

“By merging our data with MapIT’s, we are able to update our geo-demographic information much quicker as we’ll include the spatial interrogation of rapid urban developments,” enthuses Geraldine Mitchley, CEO of Knowledge Factory. “In other words, we are able to identify areas where large, informal urban and suburban developments are occurring and provide insight into the subtle market opportunities in these areas.”

These enhancements have been made possible through the integration of MapIT’s detailed GPS mapping data; doubling the ESP coverage by adding an extra 300,000 km of fresh street data into the mix.

The ESP upgrade is the first in a series of enhancements planned by Knowledge Factory and MapIT, including improved media planning solutions, drive time and trade area analytics and soon-to-be-implemented online spatially-enabled marketing solutions. “We have embarked on a strategy of partnering with various leading suppliers of geographic and demographic information to be able to ensure the veracity of our data and provide ever more accurate and timely insight to our customers,” concludes Mitchley.

In 2008, it was legislated that all Estate Agents need to be qualified against the FETC: Real Estate, SAQA ID 59097, NQF 4. To qualify, Estate Agents need to acquire a total of 150 credits.

The South African Property Transfer Guide (SAPTG) efforts to align their popular seminars with an accredited training academy reflect their ongoing commitment to contribute to the professionalisation of South Africa’s Real Estate industry.

The seminar “Easy as Pie: Stats for Success” in Real Estate outlines the effective implementation of statistics in various real-estate disciplines.  SAPTG have joined forces with The Development Institute & Training Academy of Southern Africa (DITASA) to align the material with SAQA unit 9015. DITASA, South Africa’s leading training and assessment academy, will provide delegates attending the seminar with the opportunity to participate in an RPL Assessment process to earn 6 credits towards their NQF4 qualification.

As its name suggests, geo-demographics is the correlating of demographic data — information about the population segmented by factors like age, sex or income — with concise geographic data. ’Physically locating’ demographic information through this technique allows it to be represented visually and analysed from a spatial perspective.

One of the basic tenets of geo-demographics is that people with similar values, means and perspectives naturally gravitate toward one another and form relatively homogeneous communities. In other words, that ‘birds of a feather flock together’.

By developing an understanding of the common characteristics of persons living in geographical areas or ‘clusters’, marketers are then able to target audiences more precisely and improve the efficiency of their campaigns.

“As the number of players and channels proliferate and competition intensifies, companies need to enrich their existing transaction data — who is buying what where — with geo-demographic data to identify areas that have the highest potential for new customers or to up-sell and cross-sell to existing customers,” says Geraldine Mitchley.

Knowledge Factory is also quick to point out that geo-demographic profiling is not limited to mail order marketing or other direct marketing initiatives either. “Retailers and franchisers can now identify ideal locations in a fraction of the time it used to take,” explains Mitchley.

“For these businesses, our geo-demographic segmentation tools enable them to identify trade areas with the same characteristics as their successful outlets, thereby greatly improving the likelihood of replicating such success.”