Liquidity squeeze pushes down property prices

Posted On Friday, 28 November 2008 02:00 Published by eProp Commercial Property News
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'A positive spin-off of this situation is that sellers are becoming more realistic about pricing their properties, and are no longer expecting unachievable prices'.

Property-Housing-ResidentialTWENTY-SEVEN properties came under the hammer at the Alliance Group’s property auction in Sandton on Wednesday, where prices were affected by the liquidity squeeze.

“The property market has come off a big run which saw a huge growth, but the good thing though is that most properties on offer had bidders. But the liquidity squeeze is making it difficult for buyers to get finance,” Norman Raad of the Alliance Group said.

“A positive spin-off of this situation is that sellers are becoming more realistic about pricing their properties, and are no longer expecting unachievable prices. Another good thing is that buyers now are looking for opportunities, but you are unlikely to find anyone over paying for a property.”

The biggest single seller at the auction was a parastatal that put eight noncore properties on sale.

Two Kimberley properties started off the auction.

Grandhouse Building in the central business district, with a gross lettable area (GLA) of 3 350m² and a gross income of R2,07m a year easily attained a final bid of R12m.

The second lot, a heritage building which auctioneer Rael Levitt said was reminiscent of the days when Sir Ernest Oppenheimer was mayor of the city, was a default sale.

It was knocked down to a telephone bidder from Bloemfontein for R6,75m.

Two office, warehouse and workshop buildings in Kya Sands fetched a total of R3,5m, and a 291m² unit in the Gables Office Estate in Weltevreden Park R1,05m in a liquidation sale.

Fyntrap Mansions, a block of 17 flats on a 991m² erf and lettable area of 1 839m² received a top bid of R4m.

Another block of flats in Elsburg, Germiston, offering 17 flats and earning R452 400 a year attained a hammer price of R2,6m.

A bid of R4,75m was received for a vacant warehouse with a lettable area of 2 580m² in Spartan, and a bid of R675 000 for 3 508m² vacant land in Rondebult in Germiston.

Three sectional title warehouses in Barbeque Downs, Midrand measuring 1038m² fetched a total price of R3,6m, and a vacant building in Kensington with a GLA of 669m² going for R1,4m.

A total of R3m was paid for offices at Coombe place Rivonia. The offices have a GLA of 652m² and the property has a business four zoning.

Triple Grade-A offices on 4th Street Parkmore fetched R8m. The total area of the offices and basement measure 690m²

In Driefontein, Boksburg, 4,28ha development land with a proposed industrial three zoning fetched R15m.

A smart office complex consisting of three double-storey office blocks with a special zoning in Kelvin, Sandton, attracted keen bidding and attained a hammer price of R9,25m.

Woodmead Willows, a Grade-A office block in Woodmead, Sandton, attracted attention. The building with a GLA of 825m² and gross income of R235 945 a year received a top bid of R4m.

Vacant land in Secunda was in demand and bidding for a 20 387m² erf with a Business Three zoning closed at R5m.

What is described as a residential opportunity in Phalaborwa Extension 5 fetched R400 000. The property with one brick building and six prefab buildings has a special zoning.

Houses in platteland towns either fetched low prices or no bid at all.

A final bid of R400 000 was received for a 150m² three-bedroom home with a tiled roof in Naudeville, Welkom.

There was no interest in a residential property in Dordrecht in Eastern Cape.

Some interest was shown in industrial land in Schweizer Reneke. A 2284m² erf fetched R65 000.

The lowest price paid at the auction was R55 000 for a 3 749m² erf in Coligny in North West Province.

“This must be the cheapest property ever sold on the commercial market,” Levitt said.

Last modified on Wednesday, 18 June 2014 15:56

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