When a major property group’s franchisee reports that he has, in the last year, recorded an average sales growth of 3% per month, is now selling 10 to 12 homes every month and has recently bought his own offices (for R1,3 million), this, says Tony Clarke, Managing Director of the Rawson Property Group, should tell property trend watchers something not only about the franchisee himself, but also about the area where he operates.
The franchise Tony Clarke was referring to is Bloemfontein South and the franchisee achieving these successes is Jaco de Lange.
Before buying the Rawson franchise in Bloemfontein, De Lange had already had ten years in the property industry, six of which he operated independently. He has also served on the Institute of Estate Agents National Board with Bill Rawson, Chairman of the Rawson Property Group. It was this association, he said, that got him interested in the Rawson approach to franchising – and today he credits much of his success to the “Rawson way” of doing business.
“The systems and policies are tried and tested and following their procedures has helped me to increase my office’s market share,” he said.
Homes in Bloemfontein South, said De Lange, are ideally priced for today’s fast growing lower middle and middle bracket buyers. They come in two main price brackets, R600,000 to R1,2 million for sectional title properties and from R800,00 to R2 million for full title residential homes. The bulk of the action, he said, is still, however, in the R600,000 to R800,000 price range.
Many of his buyers, said De Lange, are government or university staff and this has its advantages because they are seen by the banks as a relatively safe investment. The area also has many professionals on transfer and these buyers are always active here. The drawback however, is that up to 60% of potential buyers in Bloemfontein South have blemished credit records, many of them due to relatively minor infringements. If the banks were able to take a more lenient view of the less serious infringements, said De Lange, his sales could rise significantly.
“I am inclined to think that some easing up on the banks’ criteria could be achieved without ignoring the stipulations of the National Credit Act,” he said.
There are 24,000 homes in the Bloemfontein South franchise area, of which about 10% are sectional title homes. Like many other Rawson franchisees operating in university towns, De Lange said that Bloemfontein now offers excellent buy-to-let student accommodation opportunities. Rentals on houses suitable for student use can, he said, be anything from R4,000 per month for a relatively simple two bedroom home, to R10,000 per month for a larger home. What is more, the university has announced that it plans to increase its intake of students.
De Lange added that property in Bloemfontein has, on the whole, been stable and steady for three years and the on-going demand, he said, will inevitably lead to price rises before the end of this year.
“It”, he said, “is therefore a very good time to be buying Bloemfontein South property and I am absolutely confident that those who do so now will be grateful in the future. Of all the many high demand, stable price areas in South Africa, this is one of the best.”
