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| The Vision for South Africa |
The Vision for South Africa.
At our BMI-BRSCU Strategic Forum meeting of 6 July 2011, the draft vision for South Africa was discussed as well as the way in which the building industry can contribute to the achievement of this vision as well as make South Africa a winning nation. The Building Industry wants to align its vision with that of the Country.
Accordingly, BMI-BRSCU, on behalf of the Strategic Forum participants congratulate the NPC on its work and suggest that the ingredients for the vision, mission and values are contained in the 9 points as articulated. In order to make the vision memorable and easy to remember, it is recommended that the vision be shortened into a compelling statement, whilst the mission, values and slogan are based on the NPC submission.
We attached a short powerpoint presentation to our submission. Interested persons are invited to request a copy from our Secretariat.
We recommended the following shortened version.
Vision
A democratic state, rooted in the values of the Constitution, working with all sectors of society to improve the quality of life, build a better Africa and a better World.
To what extent do you agree with this Vision? |
0% - Disagree totally
7% - Disagree fairly strongly
7% - Neutral
14% - Agree fairly strongly
71% - Agree very strongly
Based on 14 responses
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| Strict lending policies are exacerbating the recession. |
The stringent lending practices of the banks are exacerbating the recession as evidenced by the precipitous decline in BPP and the consequent decline in BC.
Developers complain that they cannot get funding, building work in progress cannot be completed, mortgage advances to Flats and Townhouse developments have declined by some 65%, and mortgages for undeveloped land has plummeted by some 75%.
All of these actions clearly signal that the banks have judged property as a poor investment.
A consensus industry view is that conditions in the industry will only improve once the Banks demonstrated confidence in property as a preferred investment and relaxed their stringent lending criteria .
To what extent do you agree with this statement? |
1% - Disagree totally
3% - Disagree fairly highly
1% - Neutral
19% - Agree fairly highly
74% - Agree totally
Based on 140 responses
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| Quick Lesson Number 14: July 2008 |
Indications are that the Building Industry is in a decline phase affected primarily by the interest rate regime and exacerbated by world-wide uncertainty. A further decline in investor confidence will prolong and worsen the current cycle. In the current cycle there are many factors contributing to the uncertainty. These factors are both local and global.
When the uncertainty around these factors declines, risk aversion should decrease and investor confidence increase.
Inflation expectations appear to be the factor that is causing the most fear. The catalyst for a recovery is likely to be when there is market consensus that inflation is under control and there is certainty surrounding when and at what level inflation will peak.
IN YOUR VIEW, HOW LONG WILL THE CURRENT DECLINE CYCLE LAST?
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4% - Between 4 and 5 years
1% - Between 3 and 4 years
29% - Between 2 and 3 years
57% - Between 1 and 2 years
8% - Less than 1 year
Based on 134 responses
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| Quick Lesson Number 13: March 2008 |
ESKOM has announced that it the building industry is due to follow the mining industry in experiencing targeted power supply constraints.
The load shedding will impact large developments(all new developments for buildings requiring above 100 kVA of electricity supply) in both the Residential (including Affordable Housing developments) and Non Residential Sectors of the Building Industry.
Please indicate what you think the impact will be on Building activity in 2008 compared to 2007. |
17% - reduce by > 10%
66% - reduce by up to 10%
17% - unaffected
0% - increase by up to 10%
0% - increase by > 10%
Based on 58 responses
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| Quick Lesson Number 12: December 2007 |
THE Competition Commission is taking a look at the building materials and construction sectors with a view to probing any anticompetitive practices that might be driving up the costs of the public sector’s R416bn infrastructure investment programme.
Building materials prices have increased about 80% since 2000, well above average wholesale price inflation of 50%-60% over the period.
In bricks and aggregates, for example, prices have increased a consistent 10%-12% year on year, while cement has also shown consistent increases, and reinforcing steel prices has increased nearly 120% over the seven-year period.
Please indicate on a scale of 1-5 how prevalent you think price collusion and cartell activity is in the Building Materials Industry?
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3% - Extremely seldom
63% - Very seldom
20% - Average
15% - Very frequent
0% - Extremely frequent
Based on 40 responses
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| Quick Lesson Number 11: September 2007 |
There is a view that government should incorporate the equity held by homeowners in their properties into its debt figures, thereby encouraging people to own their homes.
Reserve Bank governor Tito Mboweni has warned consumers against buying on credit, but the bank, in line with international practice, does not consider the growth in property equity as savings.
It is submitted that, given that bond repayments account for about 45 percent of debt repayments, people need to deem their homes as long-term savings.
Non-property owners are losing out and it is their high debt levels to which the government should refer when considering dissavings.
On a scale of 1-5, to what extent do you agree with the view that the repayment on Mortgage Bonds should be regarded as SAVINGS rather than DEBT?
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2% - Disagree very strongly
8% - Disagree fairly strongly
0% - Neutral
31% - Agree fairly strongly
59% - Agree very strongly
Based on 49 responses
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| Quick Lesson Number 10: April 2007 |
To create sustainable human settlements, innovative ways of spatial development have to be explored. Taking a critical look at government's housing strategy, the idea of mixed-income, mixed-products and mixed-tenure is central to changing the face of our suburbia and estates. In essence, the "breaking new ground" housing strategy places the accent on building settlements that promote racial and class integration while promoting economic growth.
While this is laudable, there are those that argue that integration is already taking place naturally, driven by economic and affordability reasons, and that it doesn't have to be forced.
To what extent do you agree that Developers should be forced to assign 20% of all Residential Developments to Affordable Housing?
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57% - Disagree very strongly
28% - Disagree fairly strongly
8% - Neutral
6% - Agree fairly strongly
2% - Agree very strongly
Based on 53 responses
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| Quick Lesson Number 9: January 2007 |
The scenarios for Distribution are a consequence, inter alia, of the fragmentation of the Residential Building Industry and the increasing trends towards Home Improvement (most of which is unrecorded).
Anecdotal evidence suggests that a substantial proportion of the turnover of Distributors is accounted for by the Home Improvement, DIY/BIY market (including the purchases of the so-called Bakkie Builders).
Please give us your estimate of the percentage of Distributor turnover which could be accounted for by this market. |
0% - <30%
0% - > 30% but < 40%
2% - > 40% but < 50%
28% - > 50% but < 60%
70% - > 60%
Based on 57 responses
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| Quick Lesson Number 8: December 2006 |
The Buy-to-Let market has been a very important driver of growth in the Residential Sector. The global boom in house prices has been driven by two common factors:
* historically low interest rates have encouraged home buyers to borrow more money;
* and households have lost faith in equities after stockmarkets plunged, making property a preferred investment.
The rapid house-price inflation of recent years is clearly unsustainable, yet most economists in most countries (even in Britain and Australia, where prices are already falling) still cling to the hope that house prices will flatten rather than collapse.
It is true that, unlike share prices, house prices tend to be somewhat “sticky” downwards, but it remains to be seen whether prices will continue to fall, or simply flatten off.
However, in the process the value of Property as an Investment is affected and this can affect the Buy-to-Let market.
Please give your view of the future of the Buy-to-Let market in 2007.
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0% - Will decline by > 10%
55% - Will decline by < 10%
19% - Will remain the same as 2006
26% - Will increase by < 10%
0% - Will increase by > 10%
Based on 31 responses
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| Quick Lesson Number 7: November 2006 |
In recent times the development of Golf Course Estates have come under fire from Government and Environmentalists. The major criticisms from the antagonists are that the Golf Estates are elitist and that the environmental impact is negative, particularly related to water requirements.
The protagonists argue that the courses add value to underutilised land, provide secure environments and are extremely sensitive to environmental concerns.
To what extent do you think the criticisms against Golf Estates are justified? |
13% - To an extremely limited extent
52% - To a fairly limited extent
24% - To an average extent
7% - To a fairly high extent
2% - To an extremely high extent
Based on 46 responses
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| Quick Lesson Number 6: October 2006 |
It is said that the INTEREST RATE is the SINGLE MOST IMPORTANT determinant of consumer confidence and hence has the most influence on the willingness to take risks and to invest in a longterm asset such as Property.
Therefore it can be stated that any increase in the Interest Rate has an immediate and direct influence on Building and Property Activity.
Please indicate the extent to which you agree with this statement. |
0% - Disagree very strongly
0% - Disagree fairly strongly
8% - Neutral
38% - Agree fairly strongly
54% - Agree very strongly
Based on 37 responses
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| Quick Lesson Number 5: September 2006 |
In recent times there has been heated comment about the impact of foreign buyers on the prices of residential property in South Africa.
What is your view about this issue?
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22% - The impact of foreign buyers is extremely low
44% - The impact of foreign buyers is fairly low
27% - The impact of foreign buyers is neutral
7% - The impact of foreign buyers is fairly high
0% - The impact of foreign buyers is extremely high
Based on 41 responses
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| Quick Lesson Number 4: August 2006 |
Residential Building Activity is moderating as evidenced by declining Plans Passed and Buildings Completed as well as mortgage advances on existing buildings.
Property values have more than doubled in the last five years and Homeowners realise that they can improve and refurbish their most important asset without fear of over capitalisation.
To what extent do you agree with the statement that Home Improvement and Refurbishment is THE NEXT BIG THING as far as Residential Building Activity is concerned? |
0% - Disagree very strongly
5% - Disagree fairly strongly
8% - Neutral
38% - Agree fairly strongly
50% - Agree very strongly
Based on 40 responses
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| Quick Lesson Number 3: July 2006 |
| Building costs have been exceeding CPI inflation by a substantial margin since 2001. There are various components to the cost make-up. In your view which of the components listed is THE MAJOR CONTRIBUTOR to the fact that building cost increases exceed CPI inflation. |
0% - Unskilled Labour cost increases
0% - Skilled Labour cost increases
9% - Material cost increases
55% - Profit increases
36% - Cost increases due to poor productivity
Based on 33 responses
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| Quick Lesson Number 2: June 2006 |
It was an old Federal Reserve chairman who said that it is a central bank’s task to take away the punchbowl just as the party starts to get lively.(Cees Bruggemans, Chief Economist, FNB, 6 December 2004)
Do you think the increase in the interest rate by 0,5% to 11% prime lending rate, will have a measurable dampening influence on the residential property market?
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53% - Yes
47% - No
Based on 38 responses
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| Quick Lesson Number 1: May 2006 |
FNB property strategist John Loos said recently that the residential fixed investment boom did not “appear extreme” in comparison with the four major booms experienced since 1946.
Loos said he believed the “current softening is a result of the market taking a breather” and that it still had “significant legs for the rest of the decade”.
Do you agree that Residential Property still has “significant legs for the rest of the decade” ?
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66% - Yes
34% - No
Based on 29 responses
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