Issue 4 / February 2006
2005 was indeed an
annus mirabilis for The Bond Man. In only
our second year in business, we finalised bonds totaling R250
million and ended the year with the distinction of providing
Absa (Cape) with its highest value residential bond ever –
a R13 million deal for the purchase of a property on the Atlantic
Seaboard. In one development alone, “Eventide” in
Clifton, we secured bonds totaling R18 million.
success of this tiny business is symptomatic of a fragmentation
in the mortgage origination industry that has seen an ever
increasing number of buyers electing to exercise their right
to entrust their bond requirements to an originator of their
choice, rather than be coerced into using a broker prescribed
by an estate agent with a vested interest (usually by way
of a shareholding) in a particular mortgage originator. Unlike
any of the “big boys” in the industry, The Bond
Man has no contractual agreements with any estate agent company
and we receive no sponsorships of any kind from attorneys
or anyone else. I am proud to say that our business is generated
only through our own networking efforts.
But the real miracle of the business comes down to the handful
of superb people who make up my team. I am delighted to use
this forum to introduce you to them.
Cathy van der Weele
has been on board since inception and oversees every aspect
of the business.
is an outstanding consultant, whose decision to join me
in October last year was MortgageSA’s loss and The
Bond Man’s gain.
Kim Hogg has recently
joined our team as a consultant and will be covering the
Garden Route. Kim, who previously worked for FNB Home
Loans, is based in George and brings a wealth of experience
in property finance to the business.
Esmi Nomana joined
The Bond Man as a domestic worker in our office 6 months
ago. Since then, she has completed a computer course through
Rosebank College and is now our full-time data capturer.
Michael Ross graduated
from UCT with a B.Sc (Property Studies) at the end of
last year and completed the Estate Agents Board Exam (C.E.A.).
He is responsible for liaising with the various banks
to ensure that our deals are processed quickly and does
a fine job of keeping the banks on their toes!
WHITHER INTEREST RATES?
CPIX inflation is currently well under control at 4% year-on-year
in December, while the rand exchange rate is much stronger
since late last year. However, the international price of
oil edged up to well above $60/barrel again, which may lead
to inflationary pressures if the rand depreciates significantly
from its current level. Against this background, it came as
no surprise when the Reserve Bank’s Monetary Policy
Committee adopted a cautious approach at its meeting last
week, and left interest rates unchanged. Rates are expected
to remain at their current levels throughout 2006. The graph
(below) illustrates fluctuations in the home loan rate over
the past 20 years*.
HOME LOAN RATES OVER THE PAST 20 YEARS
Although we’re currently experiencing the lowest rate
levels in nearly 3 decades, it is sobering to think that our
interest rates are still considerably higher than in other
parts of the world.
2006 AND BEYOND
The Bond Man will continue to source the most competitive
home loan products for our new and existing clients. Please
don’t hesitate to call us should you require a quick
pre-approval or if you’d like us to increase your “access
facility” to a more appropriate level. It makes good
sense to register the maximum access facility for which you
qualify (based on income). That way, you’ll always have
instant access to funds should you spot an investment opportunity
(or for any other reason) and because interest is calculated
on a daily balance, you’ll only start paying interest
on the money if and when you use it. Best of all, the wonderful
flexibility of an “access bond” allows you to
make repayments in lumps-sums, should you wish to, with no
Please give us a call or drop us a line. We’d love
to help you.
The Bond Man
* Acknowledgements to Absa Senior Economist Jacques du Toit
(Absa Property Trends – 31 January 2006)
In a further relaxation of Exchange Control Regulations,
Finance Minister Trevor Manuel has announced an increase
in the offshore individual investment allowance, up from
R750,000 to R2m. This makes it a lot more viable for South
Africans to invest in the UK property market, where The
Bond Man can assist you to secure a mortgage through our
association with Omega Mortgage Services UK. Contact us
for news of an exciting new development which has just
been launched in London.
for more information.
The Bond Man will be strengthening our association with
Omega Mortgage Services (UK) in the coming year. As the
official representative of Omega in South Africa, we’re
ideally placed to provide a comprehensive mortgage service
to clients who wish to refinance their properties in the
UK. This facility will be of particular interest to Non-Resident
buyers who are restricted by Exchange Control legislation
to local mortgage borrowings of only 50% of the purchase
for more information.
Absa offers a fantastic (but little known) product called
Multi Plan, which allows you to split your bond into as
many sub-accounts as you like, at no additional cost.
It allows you to use your bond as a savings account for
specific, designated purposes (“kids’ education”,
“overseas trip”, “vehicle finance”,
etc) and you can receive a separate statement for each
You also have the option of apportioning your interest
rate concession between the sub-accounts as you wish.
You may, for example, elect a fixed rate for one or more
sub-accounts and a variable rate for the others.
for more information.