Mogale City – Gauteng

Working for integration Bojanala City of District Local Tshwane Municipality Municipality of Madibeng City of Tshwane Metropolitan Municipality Gauteng Rustenburg

Mogale City

West Rand District N14 Municipality Ventersdorp City of Johannesburg Metropolitan Dr Kenneth Municipality Kaunda District Municipality Ekurhuleni Randfontein Metropolitan City of Merafong Johannesburg Municipality City

Westonaria Ekurhuleni Sedibeng District Municipality MidvaalSources: Esri, USGS, N

Mogale City – Gauteng

Housing Market Overview Human Settlements Mining Town Intervention 2008 – 2013 The Housing Development Agency (HDA) Block A, Riviera Office Park, 6 – 10 Riviera Road, Killarney, Johannesburg PO Box 3209, Houghton, South Africa 2041 Tel: +27 11 544 1000 Fax: +27 11 544 1006/7

Acknowledgements The Centre for Affordable Housing Finance (CAHF) in Africa, www.housingfinanceafrica.org Coordinated by Karishma Busgeeth & Johan Minnie for the HDA

Disclaimer Reasonable care has been taken in the preparation of this report. The information contained herein has been derived from sources believed to be accurate and reliable. The Housing Development Agency does not assume responsibility for any error, omission or opinion contained herein, including but not limited to any decisions made based on the content of this report.

1. Frequently Used Acronyms 1

2. Introduction 2

3. Context 5

4. Context: Mining Sector Overview 6

5. Context: Housing 7

6. Context: Market Reports 8

7. Key Findings: Housing Market Overview 9

8. Housing Performance Profile 10

9. Market Size 15

10. Market Activity 21

11. Lending Activity 29

12. Leverage 33

13. Affordability Profile 36

14. Rental Index 40

15. Key Concepts 42

16. Source List 45

1. Frequently Used Acronyms

CAHF – Centre for Affordable Housing Finance in Africa GDP – Gross Domestic Product GVA – Gross Value Added HDA – Housing Development Agency HPI – Housing Performance Index IDP – Integrated Development Plan NU – Non-Urban, StatsSA subplace designation RDP – Reconstruction and Development Programme SDF – Spatial Development Framework SP – Subplace StatsSA – Statistics South Africa

The Housing Development Agency | Mogale City Mining Town Housing Market 2. Introduction

The Housing Development Agency (HDA) is a national public development agency that promotes sustainable communities by making well-located land and buildings available for the development of human settlements. As its primary activity, the HDA assembles and releases state, private and communal land and buildings for development. In addition, the HDA provides project delivery support services to organs of state at local, provincial and national levels.

In setting the agenda and asserting its role in the housing continuum, the HDA realised that there is a gap in the provision of accurate and easy-to-understand information regarding the property market, particularly in previously overlooked areas including the mining towns.

The development of this report is a result of this gap. It aims to explore and present an overview of the formal housing markets in Matjhabeng, Moqhaka, Merafong, Randfontein, Westonaria, Thabazimbi, Greater Tubatse, Elias Motsoaledi, Lephalale, Fetakgomo, eMalahleni, City of Matlosana, Mogale City, Ephraim Mogale, Steve Tshwete, Thaba Chweu, Tsantsabane, Ga-Sekgonyana, Gamagara, Kgetlengrivier, Madibeng, Moses Kotane and Rustenburg so as to change perceptions of affordable markets and as such, expand and deliver affordable housing options within South Africa’s municipalities.

The study was undertaken over a three-month period, relying mainly on the high level indicators developed by the Centre for Affordable Housing Finance in Africa which considered the market conditions, existing market size and activity, average prices and values, market growth and lending activity in the area to support a better understanding of the opportunity and the impact of various housing policy interventions. The centre also highlighted the range of opportunities across areas to stimulate the affordable housing market in South African municipalities.

The methodology also included site visits to eMalahleni, Randfontein, Westonaria and Rustenburg so as to confirm findings and to gain more insights about the current housing circumstances.

The report is intended for use by all stakeholders involved in planning including professionals in municipalities, Government officials, private sector, investors, developers and urban planners, for the mission of enticing a range of development options. The report does not address housing supply for the lowest income levels but rather seeks to make the case for expanding the gap market in order to entice private sector engagement more effectively.

2.1 Report Contents

The report covers the following aspects of housing markets through maps, charts and graphs to highlight understanding across the municipality and at the neighbourhood level, where housing markets function.

1. Housing Performance Proﬁle – the pace of growth by suburb, on maps and in charts, as measured by the Housing Performance Index 2. Market Size – total number and distribution of residential properties, households, values and sales prices, key demographic indicators 3. Market Activity – properties, sales and new properties and resales over time 4. Lending Activity – sales and loans by lender 5. Affordability Proﬁle – affordability based on local incomes, compared to sales price, housing gaps and affordability ratios 6. Leverage – the value of equity available for purchasing new homes 7. Rental Index – those areas most prime for quality, dense, professionally managed rental housing

2.2 Deﬁnitions and Methodology

For housing supply, title and deeds records were merged at the suburb level, mapped and ranked through the Citymark dashboard. Priority has been placed on actual transaction datasets from familiar sources that can be geocoded to the subplace level, trended over time and updated regularly. For housing demand, StatsSA data was applied as the most consistently collected, widely understood and most common source of demographic data in the Country.

The Housing Development Agency | Mogale City Mining Town Housing Market Report 2.3 Benchmarks

Benchmarks are indicators used to compare performance across areas and are valuable for understanding meaning. Each indicator was created at the local, municipal and national levels in order to measure performance within and across markets. These benchmarks also highlight areas or trends which are outperforming the overall market in certain ways and might be most receptive to a variety of new housing development options.

2.4 Site Visits

As mentioned, the team conducted four site visits to eMalahleni, Randfontein, Westonaria and Rustenburg. These visits provided the chance to confirm findings from the data and chat informally with residents about their current housing circumstances: where they had moved from, where they were currently living and how affordable it was and where they were headed, including their ambitions and concerns. This helps to provide a sense of the housing continuum in the town – what choices residents feel empowered by and what constraints keep them from realising their dreams and aspirations. Residents who were engaged came from informal settlements, brand new RDP homes and a stalled RDP project which had recently been reactivated by the city.

Some of the key insights from these site visits were:

• Residents may not know exactly what their home might be worth but they are very aware that their home has a value, which includes stability and security for themselves and a better future for their families • Many residents use their homes to supplement their own income, including renting shacks and rooms and operating home-based businesses • There might be a relationship between how the houses are handed over and the sense of ownership (as evidenced by improvements to the homes) • Everyone we spoke to understood the importance of a title deed, that the title deed proved (secured) ownership, even if in a few cases, they were not sure of its status or how to get one • Most people mentioned a better future for their children as an integral part of the importance of homeownership • Residents were aware that there is an acute shortage of housing opportunities and that despite having their homes, they were surrounded by others without adequate housing

Many people understood housing markets around them intuitively – where the better houses were closer to jobs and transportation and what the barriers were – the price, the inconvenience and the cash required to access the houses.

2.5 Using this Report

This report is intended to provide a high-level view of the mining town housing markets overall and by neighbourhood, within areas of particular interest by measuring and comparing housing market performance amongst each other and with the municipality. This report highlights connections and implications from the findings that are of significant interest to the HDA. The report does not seek to understand why things are but offers general ideas based on experience with housing markets and new learning about mining town housing markets from these reports.

The Housing Development Agency | Mogale City Mining Town Housing Market The report findings emphasise opportunity as opposed to risk or failure. Opportunities are defined as conditions or indicators within areas which can show:

• The ways in which areas or markets are behaving positively (such as growing more quickly) or showing strength (such as stability and consistency) • The ways in which areas can be connected to common strategies that promote growth, investment or sustainability (such as proximity to transit or density) • A more accurate picture of the real value of areas in ways that can leverage economic investment (such as equity, lending levels and new registrations) • Better ways in which risk can be measured and accounted for (such as timing, scale, or location risk) • A more comprehensive scope or scale of markets, to better estimate and project market intervention (such as property or population size, absorption rates, or patterns of behaviour) • Ways to challenge and overcome those perceptions or assumptions that might stymie investment, or slow growth

This report is not intended to provide a complete final picture of market conditions or demographic circumstances. It does not reflect conditions in the informal market, nor general attitudes. It is not intended to be the last word on market potential but rather the ﬁrst: how can current conditions present opportunities for better housing options and improved market performance? Where are places that might be performing better in some ways, which might provide areas of opportunity, and how? The highest and best use of this report is to suggest new ways to support the growth of affordable housing in South African mining towns, by exploring and reconsidering areas for new investment, expanding existing investment and promoting policies and programmes which can support and entice that development. It can also imply the impact of ongoing investment and programmes activities.

2.6 About Formal Housing Markets

This report relies on the South African deeds registry as the basis for analysing local housing markets. Thus, the report only measures the formal housing market, which can be defined as those residential properties which have been formally titled to a specific owner or group of owners. While this excludes a large part of the human housing condition in these towns, the advantage of focusing on the formal housing market is that it offers a better understanding of that part of the residential property market which is most opportune for leverage and investment interventions in ways previously not understood.

Taking into consideration the housing backlog from StatsSA, informal settlements and human mobility, housing markets are quite fluid and difficult to measure. Understanding housing markets more completely is one advantage of the titling initiatives recommended by many housing policy and planning advocates across the Country.

The Housing Development Agency | Mogale City Mining Town Housing Market Report 3. Context

3.1 Municipal and Regional Context:

Key aspects of the city are shown from here for contextual purposes, which have been published on the city’s website. These aspects are summarised from its 2014 IDP to give important insights to the market overall:

• “The largest part of Mogale City is rural in nature, with a specific urban concentration in the south- eastern part of the municipality where it interfaces with the Gauteng urban complex” • ”The Krugersdorp CBD is the main business social and administration centre and fulfils a regional function” • ”The areas around Krugersdorp are established middle-to-high income residential areas with the full range of urban amenities, services and facilities” • ”The areas to the south of Krugersdorp, namely Kagiso, Azaadville and Rietvallel (referred to as the Kagiso complex), are predominantly disadvantaged settlements with limited access to service and facilities” • ”Economy of the municipality is reliant on mining services transport, energy, manufacturing, agriculture and tourism”

3.2 Socio-Economic Proﬁle:

The municipality’s current demographic information is drawn from the HDA Municipal Profiles and from the 2001 – 2011 Census Data:

• ”Mogale City has a population of 362,422” • ”There was a 2.04% population growth between 2001 – 2011” • ”In 2011, over 5% of the population was unemployed and the dependency ratio was 39.4” • ”There are 117,373 households in Rustenburg, with an average household size of 3 people” • ”73.5% live in formal dwellings” • ”78.2% of the households have flush toilets connected to a sewerage system, 55% piped water inside the dwelling, 80% weekly refuse removal and 86% electricity for lighting”

The Housing Development Agency | Mogale City Mining Town Housing Market 4. Context: Mining Sector Overview

This brief industry profile is provided to help understand how the mining sector might affect and engage housing in the mining towns. The mining policies are not specific to the towns – that information is not available. This information has been included because of the mineral mined, the regional location or specific city references (this report does not assess programme efficacy or impact).

Mogale City Local Municipality lies directly west and south of the City of Johannesburg and City of Tshwane Metropolitan areas respectively, and forms part of one of the three district municipalities that make up the peripheral areas of the Gauteng province. To the north, west and south it borders onto the Madibeng, Rustenburg and Randfontein Local Municipalities respectively.

4.2 Mining Industry Proﬁle

• ”Mining contributed 2% to employment in 2009 • ”There are plans to rehabilitate mining in areas surrounding the Mogale City” • ”Krugersdorp was the only town contributing to the mining sector as it was a gold mine, with magnesium” • ”There has barely been any mining activity in Mogale City since 2009, as that was when mining had reached its maturity in the area” • ”The Kagiso complex is physically separated from Krugersdorp’s urban areas by an extensive mining belt that runs roughly in an east-west direction through the area”

4.3 Housing in the Mining Sector

Due to the remote locations of many mining operations, mining companies have long histories of providing housing solutions for its employees, from executive management to miners. Different approaches to housing policies vary and are not discussed in specific terms. Knowing the general Mine Housing Policies assists in understanding the effects on the housing markets in their entirety in the towns. Unlike large metropolitan areas where housing markets grew more organically (with some historical master planning involved), these towns were largely designed intentionally to serve the interests of the mining franchises above them. Thus, the housing markets within each town are driven largely by the business model of the specific mine company, rather than more familiar housing market dynamics. The following is only indicative of each company’s general approach; the housing models in each town are approached differently and more specific to their context. Essentially, understanding the housing options offered by the mining companies is an important factor in understanding local housing markets.

Mogale City is part of the mining belt in Gauteng which, has gold and magnesium resources produced by various mining companies, namely: Harmony Gold Mining Company, Gold Fields and Anglo Gold/Ashanti Gold. Their Mine Housing Policies outline the following:

• ”Harmony Gold Mining Company, Anglo American and Gold Fields all offer a number of different housing options, ranging from housing allowances to houses built for employees” • ”Gold Fields has eliminated hostels and unsustainable mine villages” • ”Harmony Gold pays living-out allowances, which are intended to offer employees with flexible housing options throughout the area” • ”Anglo American committed more than R2 billion to facilitate home ownership and achieve the Mining Charter target of ‘one person per room’ through 2014” • ”Anglo American currently offers a number of different housing options, ranging from housing allowances to houses built for employees”

The Housing Development Agency | Mogale City Mining Town Housing Market Report 5. Context: Housing

The municipality has identified the following challenges and opportunities from its 2014/2015 IDP:

5.1 Housing Challenges:

• Request for more RDP houses • Provision of housing to curb the 66 informal settlements identified in the municipality • Bulk Services are not available • The primary backlog in housing provision is due to unregulated settlement expansion

5.2 Housing Strategies:

• The municipality has developed a five year Housing Plan for the city, as well as a database of existing informal settlements in Mogale City. Create awareness campaigns to inform communities about the status of their informal settlements in the development plans • The recently constructed housing development that will continue in the new 5-year term of Council are Chief Mogale Housing Development, Rietvallei and Ethembalehu etc • Release public land for the purpose of low-income and affordable housing, to support delivery of 400,000 housing units in well-located land • Intergovernmental agreement with metros on informal settlement upgrade, including alignment of MIG (Cities) and Housing Subsidy grants

The Housing Development Agency | Mogale City Mining Town Housing Market 6. Context: Market Reports

HDA Mining Town reports market coverage 6.1 Report Coverage Mogale City, Data by suburb of census and formal deeds registry data, 2013 It is important to keep in mind that these reports only cover the formal housing market, as captured by the Deeds Registry. Thus, there are four

Broederstroom AH layers of information in the report:

Jack Scott Nature Reserve Doornkloof AH Lindley AH 1. Total StatsSA suburbs Mogale City NU

GaMohale Nooitgedacht AH 2. Suburbs with residential properties 3. Suburbs with residential properties

Eldorado AH sold 4. Suburbs with residential properties sold with a bond Rietvallei Ext 3

Source: Stats SA Census, 2011, South African Deeds Registry via Lightstone (Pty) Ltd, 2015.

Data coverage This map shows all the census suburbs 1 4 in the town (pink) to all the suburbs with residential properties with bonded sales (dark red). The chart shows what percentage of the town has a formal Mogale City Housing Market Report Coverage residential housing market. This may help explain some of the maps, and Total Census Subplaces (SP’s) 103 why some suburbs are included and Total SP’s with registered residential 79 77% some may be omitted. For example, properties information on bonded sales will only reference suburbs in which bonded Total SP’s with sales 72 70% sales took place. Total SP’s with bonded sales 71 69%

Market Area by the Numbers Suburbs 103 Suburbs with residential properties 79 Households 117 373 Residential properties 49 553 Housing Backlog 29 777 Backlog as percent of all properties 60% Households to properties ratio 2.37 Average monthly income R 13 700 Average property value R 683 300 Average sales price R 830 000 Total residential value R 33.9 billion Source: Centre for Affordable Housing Finance in Africa, Lightstone, StatsSA

The Housing Development Agency | Mogale City Mining Town Housing Market Report 7. Key Findings: Housing Market Overview

The Mogale City housing market has grown faster than any other mining town in the past year. This is due to growth in the surrounding towns, jobs along the mining belt and the increasing urbanisation of previously undeveloped or rural areas within the municipality. The mining towns provide stable incomes, new housing investment and, in particular, a thriving housing market. Recent growth has surged a bit, creating an opportunity for markets to be carefully assessed in order to best position the next wave of growth.

Mogale City’s affordability ratio of 2.3 is below the mining town average of 2.8, which means it takes more than two times the average municipality income to afford the average house there. Despite an above-average monthly income (R13 700), there remain large disparities amongst incomes and affordable housing access within the municipality. This may prioritise housing strategies and solutions, which propose creative financing tools and techniques to reduce financial barriers (such as down payments, interest rates and principal requirements) as well as unlocking equity, rather than simply trying to push costs down.

The presence of older Government-sponsored units within the municipality represent an important opportunity to leverage that investment in affordable housing in the years ahead, as owners seek to sell and move up the housing continuum, if opportunities are positioned properly. Average equity in these areas increase purchasing power, putting moderately priced housing within reach of lower income families. This situation can be used to drive developers to build more gap housing, and financiers to finance low cost acquisition loans.

The area has a below-average diversity and integration of housing values and property types, despite growth in some areas, which suggests a market that could be expanded to meet a wider range of needs and expectations. Formal mixed-income housing options that offer much-needed internal cross subsidisation to keep prices affordable will likely do very well, and bodes well for a market less reliant on Government and mining intervention.

Mogale City has experienced a large infusion in lending from non-traditional lenders, which account for a notable amount of all new lending in the municipality in 2008 and subsequent years. With the presence of hundreds of RDP units, it will be an important strategy to encourage traditional and new lenders to develop creative loan programmes targeting those homeowners in order to make it easier for them to sell their homes, unlock the value of those homes, and allow owners to move up the housing continuum.

The opportunity for rental housing development within Mogale City is strong within specific areas. Data indicates that 37% of households are renting. Those areas with greater density, modest incomes and affordability challenges are more likely to support quality, professionally managed, affordable rental housing. Rental housing also provides flexibility to employers and workers as mining markets expand and contract from time to time.

The Housing Development Agency | Mogale City Mining Town Housing Market 8. Housing Performance Proﬁle

8.1 Key Findings: Housing Performance Index

The Mogale City housing market has grown faster than any other mining town in the past year. This is due to growth in the surrounding towns, jobs along the mining belt, and the increasing urbanisation of previously undeveloped or rural areas within the municipality.

Recent growth has surged significantly, creating an opportunity for markets to be carefully assessed in order to best position the next wave of growth.

8.2 Policy Implications

With a market already showing fast growth, such as Mogale City, meeting housing demand will be a crucial factor in stabilising the town through this period of growth. In slow-growth neighbourhoods, where most of the lower priced housing currently exists, housing will need to be built more affordably, but will need to be situated well to better integrate housing markets. Site development initiatives should include rental housing to meet the increased demand.

8.3 Quick Deﬁnitions:

Housing Performance Index (HPI): provides an understanding of local housing market performance by tracking six key indicators which most effectively convey fundamental components of real estate markets and then comparing them to the results for the entire municipal property market to determine areas of growth or strength relative to the entire metro.

Housing Performance Profile:this describes housing market performance of local areas as growing (those areas where the index is 6.5 or higher), stable (the index is 4 or higher) or slow (the index is less than 4) compared to the metro in which it is located.

Formal Housing Market: residential properties that are registered on the South African deeds registry. This does not include informal settlements or other houses otherwise not on the deeds registry.

Indicators: suburb-level measures used to convey a more complete understanding of housing markets, sometimes a point of data (such as number of properties), or a calculated factor (such as the housing index or the affordability ratio).

Housing Continuum: a range of housing options which are available to a wide range of income levels, budgets, housing types and ownership opportunities.

Bonded Sales: the total residential properties that were transacted with a bond collateralised or secured by that property.

New Registrations: residential properties that have never appeared on the deeds registry before. This is an important indicator of the growth of a market, whether the property has just been built or was built previously and never registered.

Churn: an indicator of the sales activity within an area similar to turnover, it is the number of residential sales divided by the total number of properties.

The Housing Development Agency | Mogale City Mining Town Housing Market Report Housing Performance Index 8.4 The Housing Performance Mogale City, 2013 Market growth of six key housing market indicators, compared to the metro Index (HPI)

Rietfontein AH This map identifies the Housing Performance Index by suburb (top) and total residential properties (bottom), to provide a sense of how local property markets are performing compared to the municipality as a whole. The Housing Performance Index (HPI) provides a glimpse of the formal housing market only and does not include any demographic information. The weights were Lindley AH determined by how well the indicator reflects Mogale City NU activity, increased investment and demand (and

Magaliesburg SP how reliably the indicator can be measured).

Pinehaven Township Oaktree AH Van Wyks Restant AH This information is useful in understanding Northvale AH Sterkfontein Ruimsig Country Estate how the formal market is behaving (which is Beckedan AHMunsieville SP Eljeesee AH Helderblom AHKrugersdorp Central influenced by the presence of mines, informal

West Village Krugersdorp North Breaunanda settlements and the people who move in and Westrand Consolidated Gold Mine Reservoir Ridge around the towns). This picture is intended Kagiso Ext 6 to help understand how key housing sector Rietvallei Ext 2 Rietvallei Ext 3 Kagiso Ext 12 SP2 partners (developers or investors) seek and measure opportunity, in order to better inform Source: Centre for Affordable Housing Finance in Africa, 2015. All indicators reflect formal market data as reflected on the deeds registry. and coordinate Government planning processes Housing Performance Profile Growing and private sector motivation. Stable Slow Null “Growing” suburbs are areas which exceed the municipality’s rate of change in any four of six key market indicators. “Stable” areas meet or beat Housing Performance Index Mogale City, 2013 the municipality in at least three indicators, and Market growth profile by suburb, with property volume “Slow” areas are growing at rates less than the

Rietfontein AH municipality in two (or fewer) of the six indicators. While an index provides quick understanding, it is important to look more closely at the indicators themselves to understand more clearly the underlying factors affecting market growth and stability.

Lindley AH CAHF Housing Performance Index Mogale City NU Indicator Measured Implies Weight GaMohale Price Average sales Appreciation 25% Muldersdrift AH price Rietvei AH

Ruimsig Noord Value Average Appreciation 25%

Helderblom AH property

Breaunanda value Westrand Consolidated Gold Mine Transac- Number of Demand 15% tions sales Rietvallei Ext 3 Percent Bonds per Investment 15% Source: Centre for Affordable Housing Finance in Africa, 2015. All indicators reflect formal market data as reflected on the deeds registry. bonded sales Total Residential properties Housing Performance Profile 0 Growing 2000 Stable Churn Repeat sales Activity 10% 4000 Slow 6000 Null as a percent 8000 of total 10000 properties New New Growth 10% Properties properties added to the registry

The Housing Development Agency | Mogale City Mining Town Housing Market Housing Performance Index Trends Housing Performance Index Trends Mogale City, performance over time relative to the metro, 2007 -2013 Mogale City, performance over time relative to the metro, 2007 -2013 8.5 Performance Over 6.5 7.0 6.0 5.0 7.5 Agavia Homes Haven Time 1.0 3.5 0.0 4.5 0.0 0.0 2.0 8.0 4.0 Apple Park 2.5 2.5 Hospital View 5.0 5.0 2.5 0.0 0.0 These charts provide the 0.0 2.5 2.5 Housing Performance Index 5.5 5.5 5.0 Azaadville Joshua Doore 5.5 4.0 3.0 1.5 2.5 by suburb over time using the 2.5 2.5 2.5 2.5 7.5 8.0 5.5 3.5 six key indicators (price and Beckedan AH Kagiso Central 5.0 4.0 2.5 2.5 1.0 2.5 2.5 2.5 value appreciation, sales and 6.5 6.0 6.5 5.0 Boltonia Kagiso Ext 2 4.0 bonded sales, churn and new 4.0 2.5 1.0 3.5 0.0 4.0 4.0 properties). Growth is relative 6.5 6.5 5.0 Breaunanda 3.5 Kagiso Ext 3 2.5 to the municipality (and 2.5 1.0 1.0 4.0 3.0 0.0 3.0 7.5 change from the preceding 5.5 6.5 6.5 4.0 Burgershoop Kagiso Ext 6 5.0 5.0 4.0 year), so it is important to 3.5 2.5 4.0 2.5 compare these lines to the Chamdor 4.0 4.0 6.5 Kagiso Ext 8 5.0 0.0 0.0 0.0 0.0 4.0 0.0 0.0 2.5 area’s overall performance, 7.5 9.0 4.5 5.0 7.0 6.5 and the direction in which the Chancliff AH 5.0 2.0 Kagiso Ext 9 6.0 3.5 2.5 0.0 trends are headed. The city’s 6.5 6.5 Coronation Park 6.5 5.0 Kagiso Ext 10 6.0 growth overall (above) appears 2.5 9.0 to be on a high growth trend, 6.5 Dan Pienaarville 4.0 3.5 5.0 Kagiso Ext 11 3.5 as compared to the province. 1.0 1.0 1.0 2.5 2.5 0.0 6.5 Delporton 5.0 Kagiso Ext 12 SP2 4.0 3.0 4.0 2.5 While most areas are 8.0 6.5 Dr Masibilanga 5.0 experiencing growth, some Kagiso Ext 14 2.5 2.5 2.5 2.5 2.5 2.5 0.0 2.5 2.5 housing markets grew 6.5 Eljeesee AH 2.5 5.0 Kagiso SP slower than the town itself 0.0 0.0 0.0 5.0 0.0 0.0 2.5 5.0 2.5 in 2013 compared to the

Factoria 4.0 5.0 Kenmare 5.0 prior year (those places where 2.5 1.0 2.5 5.5 the growth profile score was Father Gerald 8.0 5.0 4.0 Krugersdorp 6.5 5.0 2.5 Central 3.5 1.5 1.0 greater in 2013 than 2012). 2.5 3.5 9.0 7.5 Featherbrooke The contraction of the mining Estate 3.5 Krugersdorp 4.0 3.5 6.5 North 2.0 1.0 2.5 2.5 2.5 0.0 sector has not affected the

GaMohale 4.0 overall market increase. In Krugersdorp West 5.0 2.5 2.5 3.5 2.5 2.5 2.5 2.5 4.0 2.5 3.5 considering development Helderblom AH 2.5 2.5 4.0 4.0 6.5 0.0 0.0 Lewisham investment over the long term, 0.0 0.0 4.0 0.0 3.5 7.5 stability of growth is often a Heuningklip AH 6.0 Lindley AH 2.0 more important consideration 3.5 3.5 2008 2009 2010 2011 2012 2013 0.0 Source: Centre for Affordable Housing Finance in Africa, 2015. All indicators reflect formal market data as reflected on the deeds registry. 2008 2009 2010 2011 2012 2013 when projecting future Growth Profile Source: Centre for Affordable Housing Finance in Africa, 2015. All indicators reflect formal market data as reflected on the deeds registry. Growing Growth Profile performance than high growth. Stable Growing Slow Stable Null Slow Building housing opportunities between areas of high and low Housing Performance Index Trend growth can better integrate Mogale City, 2008 - 2013. housing markets overall. This 8,5 information can help advice how to create a more cohesive Mogale City and stable housing continuum, with fewer spikes and drops, 2,5 and where to begin. 2008 2009 2010 2011 2012 2013 Year Areas with no data have no Source: South African Deeds Registry via Lightstone (Pty) Ltd, 2015. All indicators reflect formal market data residential properties or sales, as reflected on the deeds registry. such as farms or open space, Municipality Growth Profile Grow mines or industrial uses like power Slow generation. Stable

The Housing Development Agency | Mogale City Mining Town Housing Market Report Housing Performance Index Trends Housing Performance Index Trends Mogale City, performance over time relative to the metro, 2007 -2013 Mogale City, performance over time relative to the metro, 2007 -2013 6.5 7.5 7.5 Luipaardsvlei Estate Rietfontein AH 4.5 2.5 2.5 1.0 2.5 2.5 2.5 2.5 1.0 8.5 Magaliesburg SP Rietvallei Ext 2 2.5 4.0 0.0 2.5 1.5 2.5 2.5 0.0 2.5 2.5 2.5

Marabeth AH Rietvallei Ext 3 2.5 2.5 0.0 2.5 2.5 2.5

Mayibuye 2.5 2.5 0.0 2.5 Rietvallei SP 2.5 2.5 2.5 2.5 9.0 9.0 2.5 2.5 2.5 2.5 Mindalore 4.0 1.5 3.5 3.5 Rietvei AH

Mogale City NU 2.5 6.5 8.0 6.5 0.0 0.0 0.0 2.5 Riverside 0.0 6.5 6.5 2.5 2.5 3.0 6.5 Monument 3.5 6.5 Ruimsig Country 5.0 3.5 3.5 0.0 Estate 1.0 1.0 2.5 Muldersdrift AH 2.5 6.5 7.5 2.5 0.0 0.0 0.0 2.5 Ruimsig Noord 1.0 4.0 6.5 0.0 2.5 Munsieville SP 5.0 8.0 5.0 4.0 4.0 6.5 2.5 Silverfields 2.5 6.5 6.5 0.0 0.0 3.5 Noordheuwel 6.0 1.5 3.5 3.5 Sinqobile Phase 1

Northvale AH 2.5 3.5 1.0 2.0 0.0 2.5 Sinqobile Phase 2 4.0 2.5 2.5 Oaktree AH 2.5 2.5 2.5 0.0 0.0 0.0 2.0 1.0 5.0 Sinqobile Phase 3 2.5 2.5 Oatlands AH 2.5 2.5 2.5 2.5 0.0 0.0 0.0 2.5 0.0 4.0 6.5 6.5 Sterkfontein 2.5 Pinehaven 2.5 0.0 0.0 3.0 Township 5.0 3.5 5.0 3.5 8.0 5.5 Tsakane 5.0 5.0 Protea Ridge AH 2.5 2.5 2.5 3.0 0.0 2.5 0.0 2.5 Van Wyks Restant 6.0 7.0 9.0 6.5 AH Quellerie Park 0.0 0.0 0.0 3.5 5.0 Wentworth Park Randfontein 2.5 1.0 1.0 3.5 Estate Gold Mine 2.5 0.0 0.0 2.5 2.5 1.0 6.5 9.0 5.5 6.5 West Village Rangeview 3.5 1.0 1.0 2.5 1.0 3.5 3.5 2.5 6.5 Westrand Consolidated Gold 5.0 3.0 Rant-en-Dal 4.0 6.0 Mine 0.0 0.0 2.5 3.0 5.0 2.5 2.5 6.5 6.5 6.5 5.5 6.5 5.0 5.0 Zwaneville Reservoir Ridge 5.5 5.0 5.0 0.0 0.0 2008 2009 2010 2011 2012 2013 2008 2009 2010 2011 2012 2013 Source: Centre for Affordable Housing Finance in Africa, 2015. All indicators reflect formal market data as reflected on the deeds registry. Source: Centre for Affordable Housing Finance in Africa, 2015. All indicators reflect formal market data as reflected on the deeds registry. Growth Profile Growth Profile Growing Growing Stable Stable Slow Slow Null Null

The Housing Development Agency | Mogale City Mining Town Housing Market 8.5 Housing Performance Indicators

Six indicators – price and value appreciation (top orange and blue lines), total sales and bonded sales (middle green bars and brown line), change in new properties and churn (bottom red and blue lines) – are the most telling of growing, active housing property markets. The relationship between indicators provides clues as to what may be driving performance, what that might mean for future development potential and how it might affect or be influenced by different housing types, prices or target incomes.

These charts compare the performance of three ownership types, namely freehold, sectional title and estate ownership. The market appears to be growing, differing with most markets across the country. The rising average sales prices (green bars), are consistent with the increase in the number of sales from 2009. Sales have incrementally grown since. Bonded sales, however, dropped from 74% of all sales in 2008 (brown line) to 61% in 2013.

Housing markets are very sensitive to access to credit, so lending information will be helpful in understanding this more closely (see Lending below). Churn rates (blue line) have steadily increased since 2009, indicating higher turnover of existing homes over time. Change in new properties indicates slight fluctuations, likely due to new development in the estate and sectional title housing markets.

Key Performance Indicators Key Performance Indicators Mogale City, 2008 - 2013 Mogale City, Freehold properties, 2008 - 2013 Change over time of the six key indicators within the Housing Performance Index Change over time of the six key indicators within the Housing Performance Index R 830K R 800K R 800K R 705K

R 600K R 600K e)

R 628K R 683K nge) R 530K

R 600K R 600K (blue) R 557K

ue ue (blue) R 519K R 400K R 421K R 400K (orang ce R 400K R 400K Price (ora

erty Value erty

operty Val operty

vg vg Sale R 200K R 200K g Sale Pri

R 200K R 200K A

Avg PrAvg

Avg PropAvg

R 0K R 0K R 0K R 0K 2,552 1 500 1 500 2,480 1,351

en) 2,251 ales 1,235 1,236 2,069 1,152 2 000 2 000

1,005 tial Sales 1,752 1 000 1 000

ales ales (gree

idential S

Sales (gre 1,504

74% City 61% ale ale City 61% 731 68% 67% own)

68% Residen (brown) 66% 58%

(br

Mog 70% 69%

1 000 1 000 nded Res

Mogale

idential S esidential 71% 500 500 68%

tal tal Bonded

Total Total R

Total Total Bo

Total Total Res 0 0 To 0 0 3,5% 3,6% 3,7% 3,3% 2,6% 2,7%

ed) 2,6% (red) 3,0% 2,6% 3% 3% 2,3% 2,4% 2% 2%

perties (r perties

roperties roperties 1,8% 2% 2%

hurn (blu

urn (blue)

1,5% New Pro 1% 1%

in New P 1% 1,2% 1,2% 1% 0,4% 0,4% 0,7% 0,8% Change 0,1%

Change inChange 0,1% 0% 0,1% 0% 0,0% 0,0% 0% 0% 2008 2009 2010 2011 2012 2013 2008 2009 2010 2011 2012 2013 Source: SA Deeds Registry from Lightstone. All indicators reflect formal market data as reflected on the deeds registry. Source: SA Deeds Registry from Lightstone. All indicators reflect formal market data as reflected on the deeds registry. Key Indicators Avg Property Value Key Indicators Avg Sales Price Avg Property Value Total Residential Sales Avg Sales Price Total Bonded Residential Sales Total Residential Sales Change in New Properties Total Bonded Residential Sales Churn Change in New Properties Churn

The Housing Development Agency | Mogale City Mining Town Housing Market Report 8.6 Housing Performance Indicators by Property Type

Different housing markets perform in different ways, including freehold (free-standing) homes and sectional title (subunits within a single property). The area is predominantly freehold (see Market Size below).

The sectional title market has significantly increased from 2008 to 2013. Sectional title average sales prices (orange line) have been slightly above the average property values (top blue line) for all years, except 2012. Despite the increase in sales, bonded sales have dropped from 80% in 2008 to 51% in 2013.

Unlike the sectional title market, the number of estate sales has gone up and down over the period of 2008 – 2013. Average sales prices (orange line) for estate properties have increased from 2008 to 2013, however residential sales (green bars) have declined from 2012 to 2013, perhaps due to the completion of a new development. Bonded sales (brown line) have decreased from 84% in 2009 to 63% in 2013.

Churn rates (bottom blue lines) for both the sectional title and estate property markets have steadily increased since 2009, indicating higher turnover of existing homes over time. Change in new properties (red lines) indicates spikes, likely due to new development in the estate and sectional title housing markets.

Lending is instrumental in the growth of housing markets, and the ability to access bonds to buy sectional title houses has driven the growth of this housing type. Sectional title is also an important affordable homeownership option.

Key Performance Indicators Key Performance Indicators Mogale City, Sectional Title properties, 2008 - 2013 Mogale City, Estate properties, 2008 - 2013 Change over time of the six key indicators within the Housing Performance Index Change over time of the six key indicators within the Housing Performance Index R 800K R 761K R 800K R 2 000K R 2 000K R 1 902K

R 660K R 1 500K R 1 623K R 1 500K

R 600K R 600K nge) R 550K nge)

e e (blue) R 1 239K R 520K lue (blue) R 400K R 400K R 1 000K R 927K R 1 000K

Price (ora

perty Valu perty

operty Va operty

R 200K R 200K vg Sale R 500K R 500K

Avg SaleAvg

Avg ProAvg

Avg PrAvg

R 0K R 0K R 0K R 0K 805 617 800 800

en)

ales 600 600

ales een) 532 511 600 600 512 ty 416 Sales (gre 484 501 84%

sidential S 467 Sales (gr 400 400 448 68% sidential S ale ale City 400 400 306 299

(brown)

brown)

( 51% ogale Ci 77% 63%

Mog 80%

M sidential 71%

65% onded Re

60% esidential 68% 200 77% 200 onded Re 200 200 73%

Total Total Re

Total Total B

Total Total R

Total Total B 0 0 0 0 8% 8% 10% 10,0% 10% 7,9% 9,1%

red) 8,8% 8,4% 6,9% (red) 6,6% 6% 6,4% 6,4% 6% 8% 7,2% 7,4% 8%

5,7% e) 6,8% 6,6% 5,4% 5,6%

ue)

roperties ( roperties 4,7% roperties 6% 6% 4% 4% 4,7%

3,7% hurn (blu 4,0% C 4% 4%

Churn Churn (bl

in New P 2% 2% in New P 1,6% 2% 1,4% 2%

Change 0% 0,7% 0% Change 0,2% 0% 0% 2008 2009 2010 2011 2012 2013 2008 2009 2010 2011 2012 2013 Source: SA Deeds Registry from Lightstone. All indicators reflect formal market data as reflected on the deeds registry. Source: SA Deeds Registry from Lightstone. All indicators reflect formal market data as reflected on the deeds registry. Key Indicators Avg Property Value Key Indicators Avg Property Value Avg Sales Price Avg Sales Price Total Residential Sales Total Residential Sales Total Bonded Residential Sales Total Bonded Residential Sales Change in New Properties Change in New Properties Churn Churn

The Housing Development Agency | Mogale City Mining Town Housing Market 9. Market Size

9.1 Market Size: Key Findings Mogale City’s housing market is essentially three markets: Government-sponsored housing built as part of the National Housing Initiative over the past 20 years, privately traded and financed homes, and informal settlements. Markets are highly segregated between upper-priced, actively selling private growing markets near the city centre, and further flung lower income, non-bonded Government-sponsored developments and informal settlements (not on the deeds registry). The implied demand for housing is extremely high. The current estimated housing backlog represents about 60% of the town’s current total formal residential properties. Demand creates opportunities for new housing supply to be positioned between the existing segregated markets to better integrate the town’s spatial, income and housing markets. 9.2 Policy Implications Government can use this existing investment to identify areas of future development and entice private sector participation. Existing Government investment in housing can be leveraged to guide new development opportunities, if and when those homes can be sold to new buyers and the proceeds then used to purchase new housing further up the housing continuum. For example, Governments might prioritise new development between Government-dominated and private markets for more integration mixed-income sites, and fills spatial gaps within the town. Encouraging the expansion of financing to lower income families will allow for those homes to be sold, and the proceeds used to support housing development further up the housing continuum.

Rapidly changing housing demand driven by mining activities makes a strong case for prioritising quality rental housing. If rental housing is well-situated and convenient to transport and centrally located in dense areas, it can bring social and economic cohesion to housing markets over the longer term.

9.3 Quick Definitions: Market Size: the total number and distribution of important aspects of areas, including average home prices; home values total households in order to inform the potential scale of housing intervention strategies and the impact of proposed development schemes.

Property Value Segment: in order to better understand the performance of housing markets, data has been grouped into four property value bands: properties valued under R250 000; between R250 000 and R500 000; between R500 000 and R1.2 million and over R1.2 million. This helps one to understand the various trends and strengths inherent in each segment, and to see how properties are integrating across the housing continuum, especially over time.

Government-sponsored Housing: housing which was created through some Government intervention, from site and infrastructure provision, direct construction or finance, such as Site & Service, RDP and BNG. While these homes are not recorded as such on the deeds registry, their presence is estimated based on surrounding registrations, timing, prices and volume of activity. Freehold / Full Title: a permanent and absolute tenure of land or property by a person or entity (such as a corporation or trust) with freedom to dispose of it at will. Freehold or full title describes the assumption of full ownership rights when one owns a property, often including the building and the land it is built on.

Sectional Title: separate ownership of units or sections within a complex or development. These are often comprised of mini subtype houses, semi-detached houses, townhouses, flats or apartments and duet houses. These are governed by the Sectional Titles Act and managed by a body corporate comprised of elected representatives of the sectional title owners in the development. Absorption: the pace with which homes to be developed might be sold in a specific market during a given period of time. This can be calculated by dividing the total number of available homes coming Online by the estimated number of sales per month, often based on the rate of sales nearby.

Households to Properties Ratio: the total number of households (as reported by the census) divided by the total number of residential properties on the deeds registry. This is a quick, easy relative indicator of household density and formality of a suburb as compared to other areas.

The Housing Development Agency | Mogale City Mining Town Housing Market Report 9.4 Market Size and Distribution of Properties and Values by Suburb Mogale City, 2013 Government Investment Formal residential properties, informal settlements and mines, by suburb in Housing

Market size measures the distribution of home prices, households and values in order to inform the potential scale of housing intervention strategies, and the Lindley AH impact of proposed developments on Mogale City NU the surrounding area. It can also show the impact of Government investment Magaliesburg SP GaMohale Oaktree AH in housing markets. Comparing the

Muldersdrift AH distribution of values to the housing Rietfontein AH Protea Ridge AH performance map, several moderate income areas are growing faster than Beckedan AH Featherbrooke Estate Eljeesee AH the municipality. Helderblom AH Silverfields

Randfontein Estate Gold Mine Breaunanda In Mogale City, properties with lower Westrand Consolidated Gold Mine Mindalore Azaadville values are mostly concentrated Hospital View in the south of town, between Rietvallei Ext 2 Kagiso Ext 12 SP2

Rietvallei Ext 3 Mayibuye transit corridors and coincide with Government investment in housing (map two). It is a very positive fact that Source: South African deeds registry via Lightstone (Pty), Ltd; Housing Development Agency informal so many Government-sponsored settlements and mines. housing units are on the deeds Number of Residential properties Type Affordability 0 15 000 Informal Settlement Under R250k registry. However, often these homes 5 000 Mines Between R250k - R500k 10 000 Between R500k - R1.2m are undervalued for two reasons. The Over R1.2m subsidy value was often noted as the sales price (rather than the cost), or

Number and Percent Government Sponsored Residential Properties sales prices are driven low because Mogale City, by total residential properties per suburb, 2013 buyers lack access to credit with which to purchase the homes at a more Rietfontein AH realistic sales price, and must pay with the cash they have.

Encouraging the resale of Government-sponsored housing is an important means of expanding housing options – for the sellers, who

Lindley AH can move up the ladder with the equity

Mogale City NU from the sale of their property (see below), to the first time homebuyer GaMohale purchasing the existing home. More

Muldersdrift AH activity in these markets will also raise Rietvei AH the value of the home, often a family’s most valuable asset. Helderblom AH

West Village Breaunanda

Mindalore

Rietvallei Ext 3

Source: South African Deeds Registry via Lightstone (Pty) Ltd. All indicators reflect formal market data as reflected on the deeds registry.

Total Residential properties % Govt Sponsored 0 0% 30% 2000 4000 6000 8000 10000

The Housing Development Agency | Mogale City Mining Town Housing Market Market Size: Total Properties by Property Value Segment Mogale City, 2013 9.5 Market Size by Value Segment Sorted by suburb, by property value Kagiso Central 606 3 211 208 Noordheuwel 1 901 1 680 239 These charts provide the total properties within each Kagiso Ext 12 SP2 1 659 774 Zwaneville 2 294 suburb by property value segment (below R250 000; Rietvallei Ext 2 750 1 319 which includes most of the Government-sponsored Munsieville SP 1 180 761 Kagiso Ext 8 296 1 609 housing); between R250 000 - R500 000; between Kagiso Ext 6 996 781 R500 000 and R1.2 million and over R1.2 million). Kenmare 640 995 1 Krugersdorp North 1 433 Mogale City has a variety of property values, this Rangeview 705 724 may help to explain the area’s fairly stable market. In Mindalore 1 094 23 Krugersdorp West 1 128 25 small housing markets, Government interventions Azaadville 1 096 35 and programmes must be more targeted, as their Homes Haven 621 463 Featherbrooke Estate 1 027 impact on the market overall will be greater. Monument 235 594 Rant-en-Dal 441 444 Dan Pienaarville 276 565 The limited number of operating mines in the area Tsakane 468 319 has not created a market decline as experienced in Krugersdorp Central 380 177 Sterkfontein 123 647 other mining town index trends. Chancliff AH 295 466 Rietvallei Ext 3 374 378 Quellerie Park 635 6 A diverse approach may help to expand the diversity GaMohale 688 and distribution of housing options across town. Rietvallei SP 651 Lewisham 576 18 Wentworth Park 565 Kagiso SP 602 Kagiso Ext 11 532 Riverside 186 344 Silverfields 449 Breaunanda 370 5 Pinehaven Township 324 186 West Village 16915 Kagiso Ext 14 300 108 Kagiso Ext 2 102 Kagiso Ext 9 225 Ruimsig Country Estate 304 Burgershoop 1 Father Gerald 263 1

Joshua Doore 250 8 Hospital View 225 8 Sinqobile Phase 3 241 Westrand Consolidated Gold Mine 224 Dr Masibilanga 7 Sinqobile Phase 2 198 Kagiso Ext 3 145 Reservoir Ridge 26 Ruimsig Noord Boltonia Apple Park 125 Kagiso Ext 10 1 Agavia Randfontein Estate Gold Mine Beckedan AH Van Wyks Restant AH Rietfontein AH Magaliesburg SP Mayibuye Oaktree AH Lindley AH 19 Luipaardsvlei Estate Chamdor Northvale AH 5 Protea Ridge AH Oatlands AH Muldersdrift AH Mogale City NU Eljeesee AH Helderblom AH Heuningklip AH Rietvei AH Marabeth AH Delporton Coronation Park Factoria Sinqobile Phase 1 0K 1K 2K 3K 4K Total Residential Properties Source: SA Deeds data, via Lightstone (pty) Ltd, 2015. All indicators reflect formal market data as reflected on the deeds registry. Property Value Segment Under R250k Between R250k - R500k Between R500k - R1.2M Over R1.2M

The Housing Development Agency | Mogale City Mining Town Housing Market Report Market Size: Total Properties by Property Type 9.6 Market Size by Property Type Mogale City, 2013 Freehold, Sectional Title and Estate properties Kagiso Central 4 025 Noordheuwel 835 1 069 1 916 Mogale City’s residential properties are predominantly Kagiso Ext 12 SP2 2 433 freehold, with some sectional title and estate Zwaneville 2 309 Rietvallei Ext 2 2 069 properties mostly located in the centre of town. Munsieville SP 1 976 Kagiso Ext 8 1 921 Kagiso Ext 6 1 813 Where those housing options are located is central Kenmare 375 1 307 to understanding its intended target market and Krugersdorp North 812 820 Rangeview 595 818 it’s potential. Mindalore 338 964 Krugersdorp West 1 141 Azaadville 1 167 Homes Haven 586 509 Featherbrooke Estate 1 025 Distribution of Properties types by Suburb Mogale City, by total residential properties per suburb, 2013 Monument 349 581 Rant-en-Dal 200 674 Rietfontein AH Dan Pienaarville 819 Tsakane 814 Krugersdorp Central 545 241 Sterkfontein 650 Chancliff AH 349 355 Rietvallei Ext 3 752 Quellerie Park 653 GaMohale 688 Rietvallei SP 659 Lewisham 588 Wentworth Park 563 Lindley AH Mogale City NU Kagiso SP 608 Kagiso Ext 11 589

Riverside 568 GaMohale Silverfields 369 Van Wyks Restant AH Breaunanda 410 Protea Ridge AH Northvale AH Van Wyks Restant AH Pinehaven Township 351 Rant-en-Dal Ruimsig Noord Dan Pienaarville West Village 320 Pinehaven Township Krugersdorp North Homes Haven Featherbrooke Estate Kagiso Ext 14 408 Wentworth Park Kagiso Ext 2 401 Krugersdorp Central Breaunanda Luipaardsvlei Estate Westrand Consolidated Gold Mine Kagiso Ext 9 378 Lewisham Mindalore Ruimsig Country Estate 304 Azaadville

Burgershoop 252 Kagiso Ext 12 SP2

Father Gerald 276 Mayibuye Joshua Doore 267 Hospital View 245

Sinqobile Phase 3 241 Source: South African Deeds Registry via Lightstone (Pty) Ltd. All indicators reflect formal market data as reflected on the deeds registry.

Westrand Consolidated Gold Mine 156 Total Residential properties Property Type Description 0 Estate Dr Masibilanga 232 2000 Freehold Sinqobile Phase 2 198 4000 Sectional Title Kagiso Ext 3 158 6000 8000 Reservoir Ridge 152 10000 Ruimsig Noord

Boltonia 127 Apple Park 125 Kagiso Ext 10 114 Agavia 47 Randfontein Estate Gold Mine Beckedan AH 77 Van Wyks Restant AH 1 Rietfontein AH Magaliesburg SP 36 Mayibuye 36 Oaktree AH Lindley AH 19 Luipaardsvlei Estate 8 Chamdor

Northvale AH 1 Protea Ridge AH 4 Oatlands AH 3 Muldersdrift AH Mogale City NU Eljeesee AH 1 Helderblom AH 1 Heuningklip AH 0 Rietvei AH 0 Marabeth AH 0 Delporton 0 Coronation Park 0 Factoria 0 Sinqobile Phase 1 0 0 500 1000 1500 2000 2500 3000 3500 4000 4500 Total Residential Properties Source: SA Deeds Registry via Lightstone (Pty) Ltd., 2015. All indicators reflect formal market data as reflected on the deeds registry. Property Type Description Freehold Estate Sectional Title

The Housing Development Agency | Mogale City Mining Town Housing Market 9.7 Market Size by Households and Income

Understanding the distribution of households and incomes within Mogale City helps to inform scale, development impact, and programme targets. Census data is useful as the only source of demographic information consistently available at the suburb level, and provides interesting insights into local differences.

Areas with high levels of renters (grey bars) also very often have the highest household incomes, however in Mogale City there are only a few (such as Monument and Krugersdorp North). It is suggested that these high levels of renters might be the combination of higher income executives who rent (instead of own) their homes, as well as support staff who rent nearby in backyard accommodation.

Ratios of households (from StatsSA) to properties (from the deeds registry) – the red bar - can show degrees of limited supply or informality. The informal settlements in Eljeesee AH and Mogale City NU have high populations, few registered properties and low incomes.

20% Sinqobile Phase 1 739 0 R 3.2K Market Size: Households, Properties and Income Mogale City, 2013 47% Lindley AH 734 19 38.6 R 4.9K Total households, renting, total properties, household to property ratio and average monthly income by suburb 39% Households Renting (Grey) Kagiso Ext 2 728 401 1.8 R 6.4K 33% 0K 5K 10K Hospital View 615 245 2.5 R 17.9K Kagiso Central 41% 4,025 2.1 R 5.4K 52% 8,617 Magaliesburg SP 535 36 14.9 R 8.4K Munsieville SP 45% 1,976 3.1 R 4.7K 12% 6,117 Sinqobile Phase 2 535 198 2.7 R 3.3K Kagiso Ext 12 SP2 49% 2,433 2.3 R 3.7K 63% 5,563 Westrand Consolidated Gold Mine 515 233 2.2 R 17.6K Rietvallei Ext 2 52% 2,069 2.6 R 2.4K 34% 5,417 Ruimsig Noord 514 144 3.6 R 18.0K Zwaneville 43% 2,309 2.2 R 2.7K 14% 5,182 Sinqobile Phase 3 498 241 2.1 R 3.3K Sterkfontein 41% 773 6.3 R 3.0K 15% 4,905 Kagiso Ext 9 487 378 1.3 R 13.5K Noordheuwel 29% 3,820 1.2 R 37.6K 33% 4,556 Dr Masibilanga 469 232 2.0 R 10.0K Mayibuye 32% 36 80.6 R 2.8K 59% 2,901 Luipaardsvlei Estate 462 17 27.2 R 4.9K Kagiso Ext 8 31% 1,921 1.5 R 9.2K 46% 2,884 Joshua Doore 452 267 1.7 R 9.3K Kagiso SP 31% 608 4.7 R 3.1K 28% 2,877 Pinehaven Township 432 510 0.8 R 50.3K Mogale City NU 36% 1 2,877.0 R 9.7K 23% 2,877 Breaunanda 422 518 0.8 R 37.2K Azaadville 21% 1,176 2.1 R 12.4K 49% 2,525 Oatlands AH 388 3 129.3 R 6.9K Krugersdorp North 41% 1,641 1.5 R 24.1K 37% 2,488 Homes Haven 353 1,099 0.3 R 39.5K Kagiso Ext 6 17% 1,813 1.3 R 14.1K 6% 2,347 Father Gerald 339 276 1.2 R 22.3K Rietfontein AH 35% 62 37.2 R 6.3K 53% 2,306 Boltonia 337 142 2.4 R 17.1K Krugersdorp Central 88% 786 2.8 R 9.3K 27% 2,192 Eljeesee AH 334 1 334.0 R 6.4K Kenmare 28% 1,737 1.2 R 29.2K 30% 2,061 Oaktree AH 328 28 11.7 R 19.9K Krugersdorp West 39% 1,207 1.5 R 12.0K 64% 1,803 Heuningklip AH 310 0 R 6.6K Rangeview 23% 1,435 1.2 R 35.1K 9% 1,754 Ruimsig Country Estate 293 304 1.0 R 67.4K Mindalore 26% 1,302 1.2 R 24.9K 22% 1,550 Muldersdrift AH 287 2 143.5 R 13.4K GaMohale 31% 688 2.2 R 3.7K 60% 1,502 Northvale AH 260 5 52.0 R 8.2K Rietvallei Ext 3 39% 752 1.9 R 2.7K 71% 1,466 Agavia 259 94 2.8 R 15.6K Tsakane 36% 814 1.8 R 7.9K 73% 1,465 Apple Park 256 125 2.0 R 10.3K Kagiso Ext 14 56% 408 2.8 R 4.4K 29% 1,140 Kagiso Ext 3 230 158 1.5 R 11.0K Lewisham 49% 638 1.8 R 11.7K 19% 1,130 Helderblom AH 206 1 206.0 R 15.0K Monument 38% 930 1.2 R 30.7K 31% 1,124 Protea Ridge AH 200 4 50.0 R 17.6K Rietvallei SP 31% 659 1.7 R 3.3K 17% 1,122 Reservoir Ridge 200 152 1.3 R 18.7K Dan Pienaarville 19% 853 1.3 R 31.4K 37% 1,110 Beckedan AH 186 77 2.4 R 14.4K West Village 46% 412 2.6 R 6.8K 22% 1,090 Kagiso Ext 10 164 114 1.4 R 7.0K Rant-en-Dal 24% 929 1.1 R 35.5K 30% 1,062 Marabeth AH 127 0 R 24.9K Featherbrooke Estate 16% 1,070 1.0 R 86.3K 46% 1,052 Van Wyks Restant AH 127 64 2.0 R 4.0K Kagiso Ext 11 25% 589 1.6 R 14.8K 47% 945 Chamdor 68 11 6.2 R 8.3K Riverside 19% 568 1.6 R 9.8K 0% 896 Coronation Park 60 0 R 2.7K Quellerie Park 30% 718 1.2 R 20.2K 84% 890 Randfontein Estate Gold Mine 50 89 0.6 R 20.1K Chancliff AH 43% 761 1.0 R 32.7K 0% 799 Factoria 10 0 R 15.7K 25% Silverfields 795 530 1.5 R 35.8K Delporton 0% 0 R 5.1K 3 Avg =627 Avg= R 15.6K 34% Wentworth Park 785 628 1.3 R 22.5K 0K 5K 10K 0K 2K 4K 0 1,000 2,000 3,000 R 0.0K R 50.0K R 100.0K 50% Rietvei AH 757 0 R 6.8K Total Households Total Residential Properties HHs to Properties Ratio Avg monthly HH income 70% Burgershoop 754 288 2.6 R 8.3K Source: Stats SA Census 2011 (with CPI increase); South African Deeds Registry via Lightstone (Pty) Ltd, 2015. All indicators reflect formal market data as reflected on the deeds registry.

The Housing Development Agency | Mogale City Mining Town Housing Market Report 10. Market Activity

10.1 Key Findings

Sales of units are concentrated in south central located suburbs in mostly upper-income areas. Sales dropped across the country after 2008, and in Mogale City sales have picked up slowly afterwards, and mostly in higher priced housing.

Bonded sales in lower markets are a small portion of the bonded market. Sales continue to be dominated by repeat sales, with few new housing sales. Property value (the home’s worth) and sales prices are closely related in active markets. In less active markets, sales prices are significantly less than their suggested value.

10.2 Policy Implications

Focus on increasing access to lending, determining what barriers exist to make credit more accessible, either through lower cost products, more flexible terms, and/or inclusion of existing debt into a mortgage loan product.

Create financing products which can bring down the cost of quality rental housing as an affordable alternative to homeownership for lower income families.

10.3 Quick Definitions:

Market Activity: performance of key housing property market indicators over time, such as sales, bonds, registrations and churn.

Market Share: the portion of the market according to certain indicators, such as loans, types of properties, or property values.

Property Value Segment: in order to better understand the performance of housing markets, data has been grouped into four property value bands: properties valued under R250 000; between R250 000 and R500 000; between R500 000 and R1.2 million and over R1.2 million. This helps one to understand the various trends and strengths within each segment, and to see how properties are integrating across the housing continuum, especially over time.

Bonded Sale: a transfer of deed on the deeds registry with an associated bond from a lender, including the property as collateral for the bond.

New Sale / New Registration: the appearance of a residential property on the deeds registry for the first time. It might include new construction or previously existing units being recorded for the first time (such as previously built RDP homes).

Resale / Repeat Sales: the sale or transaction of a property which has existed on the deeds registry before (as opposed to a new sale or new registration).

The Housing Development Agency | Mogale City Mining Town Housing Market 10.4 Sales and Bonded Sales by Property Value Segments

On average, about 79% of all residential sales and 85% of bonded sales in Mogale City have been over R500 000 (the red and orange sections). Market share (the portion of the total) by property value segment has changed since 2008, suggesting an evolving housing market. The relationship between sales and bonds shows the importance of access to credit to growing housing markets, in particular the lower valued segments. The share of bonded sales under R500 000 has dropped over time, from 20% of all sales in 2008 to 11% in 2011. This might be due to credit indebtedness, which disproportionately impacts lower income borrowers, or lack of access to affordable homes with which to buy. Policies which help expand access to credit and provide more housing opportunities under R500 000, in the lower bands, can expand sales within that band.

Total Sales by Property Value Segment Total Bonded Sales by Property Value Segment Mogale City, 2008 - 2013 Mogale City, 2008 - 2013 All residential sales All residential sales 3000 3000

2500 6% 2500

13% 15% 9%

s 2000 8% 13% 2000 17%

12% tialSale

l Sales l 4% 2% 13% 1% 1500 3% esiden 1500 18% 1%

identia 17% 49% 1% 13% 10%

18% R ded 48% 1% al Res al 11% 52% 53%

Tot 1%

talBon 1000 51% 1000 18% To 57% 55% 49% 58% 56% 54%

55% 500 500 30% 26% 32% 27% 33% 23% 24% 34% 31% 31% 23% 26% 0 0 2008 2009 2010 2011 2012 2013 2008 2009 2010 2011 2012 2013 Source: SA Deeds Registry via Lightstone (Pty) Ltd., 2015. All indicators Source: SA Deeds Registry via Lightstone (Pty) Ltd., 2015. All indicators reflect formal market data as reflected on the deeds registry. reflect formal market data as reflected on the deeds registry. Property Value Segment Property Value Segment Under R250k Under R250k Between R250k - R500k Between R250k - R500k Between R500k - R1.2M Between R500k - R1.2M Over R1.2M Over R1.2M

The Housing Development Agency | Mogale City Mining Town Housing Market Report Percent of Sales Bonded by Value Segment 10.5 Lending per Property Mogale City, All residential sales, 2008 - 2013 Value Segments

81% This chart shows (by contrast to the 79% 80% previous charts) the percent of bonded 78% sales within the various property 71% value segments. Overall, with the 70% exception of homes between R250 000 and R500 000 (the green 67% line) the total sales receiving bonds in Mogale City went down 60% 61% over the past six years, but the drop was not evenly experienced.

ded The upper middle property values (the 50% orange line) experienced the greatest

s Bons drop in bonded sales since 2008, perhaps due to lack of access to credit 40% or decreased supply of housing that of Sale of falls within this segment. The lower middle (blue line) is the only segment

ercent

P that has been on an upward surge 30% since 2010, with the lower (green lines) property value segment only experiencing an increased level of 20% bonds in the past year, perhaps due to new housing, which likely fit into this price range. 14% 10% 8% The upper tiered properties more closely reflect the activity of 0% overall bonded sales rates across 2008 2009 2010 2011 2012 2013 the country. Year

Market Segment Under R250K Betw R250K- R500K Betw R500K - R1.2M Over R1.2M

The Housing Development Agency | Mogale City Mining Town Housing Market Sales by Property Value Segments 10.6 Sales by Property Value Mogale City, by suburb, 2013 Segments

Lindley AH This map shows the volume of sales activity (the size of the dot) Mogale City NU by suburb across the town, by property value segment (slices of

Magaliesburg SP the pie). Most sales took place in the centre of town. The higher (red) and upper-middle (orange) valued Oaktree AH Muldersdrift AH properties saw most activity, but Protea Ridge AH Van Wyks Restant AH Rietvei AH lower priced homes (green) also saw Heuningklip AH registered sales activity, a potential Sterkfontein Pinehaven Township Marabeth AH Chancliff AH Ruimsig Country Estate Beckedan AH sign of active (increased) supply and Featherbrooke Estate Eljeesee AH Delporton Dan Pienaarville Krugersdorp North steady demand. Helderblom AH Rangeview Krugersdorp Central Randfontein Estate Gold Mine Wentworth Park Access to credit is a significant boost Breaunanda Luipaardsvlei Estate or barrier to housing market growth. Westrand Consolidated Gold Mine Mindalore Sinqobile Phase 2 While some suburbs offer a range of Reservoir Ridge Joshua Doore housing price options; pinpointing Kagiso Ext 9 Kagiso Ext 12 SP2 product prices and types to specific Rietvallei Ext 2 areas, especially considering local Rietvallei Ext 3 affordability; is key to ensuring Source: South African Deeds Registry via Lightstone (Pty) Ltd, 2015. All indicators reflect formal market data as reflected on the deeds registry. programme success. Total Residential Sales Property Value Segment 0 Under R250k 50 Between R250k - R500k 100 Between R500k - R1.2m 150 Over R1.2m 200 ≥ 250

The Housing Development Agency | Mogale City Mining Town Housing Market Report 10.7 Sales by New and Repeat Sales

An important distinction in market performance is the sale of new homes (which have never appeared on the deeds registry) and the resale of existing homes. The chart shows new (green) and repeat sales (orange) by suburb. In most mining towns, new registrations are clustered in only a few suburbs. Several suburbs experienced new sales in Mogale City, however the most sales appear to be within the Homes Haven area.

New sales can also show the recent registration of Government-sponsored housing investment. An important point is to recognise the impact of newly registered Government investment in housing. Often these registrations may be perceived as a market distortion, but the deeds issued on Government-sponsored housing represent real assets which now can be traded and loaned against, and are key to moving up the housing ladder. Thus, the housing market has in fact grown.

Suburbs with no data reflect areas with no sales or new registrations.

Luipaardsvlei Estate Total Sales by Sales Type Magaliesburg SP Mogale City, 2013 0 New and repeat sales Marabeth AH 0 Agavia 0 Mayibuye Apple Park Mindalore 100 Azaadville 39 Mogale City NU Beckedan AH 7 Monument 73 Boltonia 0 Muldersdrift AH Breaunanda 33 Munsieville SP 10 Burgershoop 21 Noordheuwel 226 Chamdor 0 Northvale AH 0 Chancliff AH 52 Oaktree AH 5 Coronation Park Oatlands AH 0 Dan Pienaarville 53 Pinehaven Township 63 Delporton Protea Ridge AH 0 Dr Masibilanga Quellerie Park 51 0 Eljeesee AH Randfontein Estate Gold .. 0 Factoria 0 Rangeview 119 Father Gerald 5 Rant-en-Dal 72 89 Featherbrooke Estate Reservoir Ridge 0 GaMohale Rietfontein AH 11 Helderblom AH 0 Rietvallei Ext 2 Heuningklip AH Rietvallei Ext 3 Homes Haven 286 Rietvallei SP Hospital View 0 Rietvei AH Joshua Doore Riverside 7 Kagiso Central 14 Ruimsig Country Estate 37 Kagiso Ext 2 0 Ruimsig Noord 18 Kagiso Ext 3 3 Silverfields 34 Kagiso Ext 6 32 Sinqobile Phase 1

Kagiso Ext 8 108 Sinqobile Phase 2 60 5 Kagiso Ext 9 Sinqobile Phase 3 27 Kagiso Ext 10 5 Sterkfontein 18 Kagiso Ext 11 8 Tsakane 11

Kagiso Ext 12 SP2 0 Van Wyks Restant AH 4 Kagiso Ext 14 Wentworth Park 33 Kagiso SP 0 West Village 28 Kenmare 109 Westrand Consolidated G.. 11 Krugersdorp Central 46 Zwaneville 7 Krugersdorp North 106 0 40 80 120 160 200 240 280 320 Total Residential Sales Krugersdorp West 76 Source: SA Deeds Registry via Lightstone (Pty) Ltd., 2015. All indicators reflect formal market data as reflected Lewisham 47 on the deeds registry. Lindley AH Measure Names Total Repeat Sales Luipaardsvlei Estate Total New Sales Magaliesburg SP

The Housing Development Agency | Mogale City Mining Town Housing Market 10.8 Market Activity amongst New and Repeat Sales

The growth and maturity of housing markets can often be found by comparing new homes and resales over time. The growth of existing home sales (the orange line) indicates sustained interest of housing markets by borrowers and lenders. The thicker lines reflect areas with more sales.

Often volumes of new homes in prior years become resales in later years (for example, Kagiso Ext 9’s uptick of resales in 2011). Understanding how mining companies create new units helps to understand their existing and potential contribution to expand the local housing economy.

0 0 3 Luipaardsvlei Estate 0

Sales Trends by Sales Type 1 1 2 1 1 Mogale City, 2008 - 2013 Magaliesburg SP New and repeat sales 0 0 0 0 0 8 4 8 4 0 0 0 0 0 0 Agavia 2 Marabeth AH 0 0 0 0 0 0 0 0 0 0 0 32 Apple Park Mayibuye 0 110 32 2925 30 19 39 7857 65 110 96 100 Azaadville Mindalore 1 0 0 0 0 0 1 0 0 0 0 0 4 7 5 7 Beckedan AH 3 3 Mogale City NU 0 0 0 0 1 0 4548 6360 73 10 9 12 7 13 26 Boltonia 4 Monument 1 0 0 0 0 0 03 32 28 2 3 22 2123 18 29 33 Breaunanda Muldersdrift AH 0 0 1 1 1 1 7 10 10 10 27 17 19 17 21 3 8 Munsieville SP 1 Burgershoop 0 0 10 0 0 0 0 0 0 0 0 174 180 189197 235 226 0 0 0 0 0 0 Noordheuwel Chamdor 0 0 0 0 0 0 9542 20 90202 112 1 1 51 64 52 Northvale AH 0 0 0 Chancliff AH 118 33 36 37 0 0 0 0 0 29 8 29 44 33 9 5 Oaktree AH 3 Coronation Park 0 0 0 000 0 0 0 0 0 0 0 4137 38 54 48 53 Oatlands AH Dan Pienaarville 0 0 0 0 0 0 0 0 0 0 1 4743 47 49 65 63 0 0 Pinehaven Township Delporton 23 6 5 4 4 0 0 0 0 0 0 0 0 7 Protea Ridge AH Dr Masibilanga 2 2 0 0 0 0 0 0 0 0 0 51 32 3143 41 51 Quellerie Park 0 0 0 0 0 0 37 Eljeesee AH 0 142 1 6 0 0 0 0 0 0 76 Randfontein Estate Gold Mine 0 0 0 0 0 0 8 1 1 1 Factoria 2 2 0 0 0 0 0 0 0 104 60 9386 89 119 3 33 5 Rangeview Father Gerald 2 1 20 31 12 9 0 5 0 0 0 0 0 0 4630 38 51 53 72 Rant-en-Dal 7756 83 75 108 89 53 Featherbrooke Estate 0 0 1 25 26 13 1116 10 9 6 63 4 Reservoir Ridge 2 1 2 2 1 0 0 0 0 0 0 GaMohale 0 0 36 11 11 Rietfontein AH 9 4 0 0 0 0 0 1 00 33 5 2 Helderblom AH 0 0 0 0 0 Rietvallei Ext 2 0 Heuningklip AH 0 Rietvallei Ext 3 114 Homes Haven 82 62 286 42 32 49 2 1 1 7555 60 95 39 Rietvallei SP 6 5 3 3 0 0 0 Hospital View 2 2 0 0 0 0 0 0 0 0 0 Rietvei AH 4 3 0 0 0 Joshua Doore 1 1 1 6 4 4 7 0 0 0 0 0 Riverside 3 3 28 13 22 20 25 14 0 0 0 0 1 0 Kagiso Central 2519 41 39 31 37 1 1 1 0 0 0 Ruimsig Country Estate 44 5 4 4 04 34 4 4 Kagiso Ext 2 1 9 199 12 18 0 0 0 0 0 0 Ruimsig Noord 2 0 0 11 2 0 7 5 3 3 Kagiso Ext 3 1 2 21 4330 34 0 0 0 0 0 0 Silverfields 13 17 0 0 20 0 1 64 39 44 30 42 32 Kagiso Ext 6 2 6 12 0 0 Sinqobile Phase 1 74 48 108 Kagiso Ext 8 42 39 31 29 99 2 4 5 12 32 Sinqobile Phase 2 0 0 060 32 23 38 12 Kagiso Ext 9 8 9 5 164 2 2 0 0 0 0 Sinqobile Phase 3 500 3 0 27 6 5 4 7 5 3 15 13 18 Kagiso Ext 10 9 8 6 01 0 1 0 0 Sterkfontein 3 3 1 0 2 1 2814 20 19 14 Kagiso Ext 11 8 19 8 8 12 11 Tsakane 3 0 0 0 0 0 0 0 0 0 0 0 0 150 Kagiso Ext 12 SP2 2 12 7 9 10 Van Wyks Restant AH 4 05 0 0 0 04 4 1 2 3 1 1 26 21 27 38 50 33 Kagiso Ext 14 Wentworth Park 0 0 0 0 00 2 1 0 0 4 22 2 1 2524 22 33 29 28 Kagiso SP 0 3 West Village 1 0 0 0 0 1 0 20 0 2 755990 103 107 109 31 48 Kenmare Westrand Consolidated Gold M.. 40 11 11 22 2 0 16 2 4 81 2 7 7 2 68 4034 46 46 4 4 4 7 Krugersdorp Central 21 Zwaneville 2 2 1134 33 3 1 0 0 0 0 0 0 59 43 84 87 95 106 2008 2009 2010 2011 2012 2013 Krugersdorp North 206 6 3 5 Source: SA Deeds Registry via Lightstone (Pty) Ltd., 2015. All indicators reflect 78 52 79 79 100 76 formal market data as reflected on the deeds registry. Krugersdorp West 1 00 1 0 0 Number of Repeat Sales Measure Names 31 32 40 36 48 47 0 235 Total New Sales Lewisham 50 Total Repeat Sales 0 0 0 0 0 0 100 3 150 4 2 Lindley AH 1 31 1 200 2 0 0

The Housing Development Agency | Mogale City Mining Town Housing Market Report Market Activity: Total Sales and Change in Sales Mogale City, 2012 - 2013 10.9 Total Sales by Change in residential and bonded sales Agavia -80% Property Value, Change Azaadville 36 112% from the Prior Year Beckedan AH 150% Boltonia Breaunanda This chart shows the change Burgershoop 275% 100% Chamdor in activity for property sales Chancliff AH 44 41 2331 Dan Pienaarville 43 36 (first two columns) and Eljeesee AH bonded property sales (third Factoria 0 0 Father Gerald 5 67% 4 33% and fourth columns) from Featherbrooke Estate 88 133% 61 2012 to 2013. It is possible Helderblom AH 0 0 Homes Haven 202 192 173% 735% 102 61 510% to see important market shifts Hospital View 2 -33% 2 -33% Kagiso Central by comparing the change Kagiso Ext 2 1 -50% 0 -100% in activity within particular Kagiso Ext 3 Kagiso Ext 6 22 property markets from one year Kagiso Ext 8 119 106 172% to the next. Kagiso Ext 9 Kagiso Ext 10 -57% -25% Kagiso Ext 11 Homes Haven experienced the Kagiso Ext 12 SP2 -75% Kagiso SP 1 0 biggest changes in both sales Kenmare 33 64 48278 Krugersdorp Central 9 and bonds from 2012 to 2013 Krugersdorp North 98 250% 66 for the upper middle and higher Krugersdorp West 72 50 Lewisham 43 23 (red and orange bars) property Magaliesburg SP 1 0% 1 values. Zwaneville is the only Marabeth AH Mindalore 68 27 50 21 area which experienced a 250% Monument 51 32 Munsieville SP increase in sales for the under Noordheuwel 123 131 84 101 88 64 R250 000 segment from 2012 Northvale AH 0 0 Oaktree AH to 2013. Most other areas Oatlands AH 0 0 experienced a drop. Pinehaven Township 54 39 Protea Ridge AH Quellerie Park 49 23 100% Suburbs with no information had Randfontein Estate Gold Mine -67% -100% Rangeview 7351 29 44 57% no residential sales in the past two Rant-en-Dal 38 53 29 37 Reservoir Ridge -50% years. Rietfontein AH 300% -80%100% Riverside 100% Ruimsig Country Estate 41 17% 33 27% Ruimsig Noord 9 Silverfields 22 69% Sinqobile Phase 2 60 -39% 0 Sinqobile Phase 3 27 -84% 0 Sterkfontein 19 27% 8 33% Tsakane Van Wyks Restant AH 5 -17% 2 0% Wentworth Park 23 100% West Village Westrand Consolidated Gold Mine 13 0% 11 10% Zwaneville 7 250% 2 0 100 200 300 400 0% 500% 1000% 0 50 100 150 200 250 0% 200% 400% 600% Total Residential Sales Change in Residential Sales Total Bonded Residential Sales Change in Bonded Residential ..

Source: SA Deeds Registry via Lightstone (Pty) Ltd., 2015. All indicators reflect formal market data as reflected on the deeds registry. Property Value Segment Between R250k - R500k Between R500k - R1.2M Over R1.2M Under R250k

The Housing Development Agency | Mogale City Mining Town Housing Market 10.10 Change in New and Repeat Sales

This chart shows the specific rate of activity of new and repeat sales from 2012 to 2013. As seen before, new sales were concentrated in Homes Haven.

Many of the developments built by the Government are heading into their 8th year, and become eligible for resale by their owners. By understanding when those units come Online for resale, Government can align policies, which encourage sale and development nearby, which can help leverage that prior investment, expand housing options and stimulate movement up the next rung up the housing ladder. Resales are an important means of recycling existing homes to make more housing options available.

Suburbs with no information had no residential sales in the past two years.

Lindley AH

Market Activity: Total Sales and Change from previous year Luipaardsvlei Estate Mogale City, 2012 - 2013 Change in new and repeat sales Magaliesburg SP 1 0% 0

Agavia 4 -50% 0 Marabeth AH 0 0 Apple Park Mayibuye

Azaadville 39 105% 0 Mindalore 100 4% 0

Beckedan AH 7 133% 0 -100% Mogale City NU

Boltonia 4 -69% 0 Monument 73 22% 3 50%

Breaunanda 33 14% 1 0% Muldersdrift AH

Burgershoop 21 163% 0 Munsieville SP 10 0% 0

Chamdor 0 0 Noordheuwel 226 -4% 112 -45%

Chancliff AH 52 -19% 33 -25% Northvale AH 0 0 Coronation Park Oaktree AH 5 0

Dan Pienaarville 53 10% 1 Oatlands AH 0 0 Delporton Pinehaven Township 63 -3% 4 0% Dr Masibilanga Protea Ridge AH 0 0

Eljeesee AH 0 0 Quellerie Park 51 24% 6 500%

Factoria 0 0 Randfontein Estate Gold Mine 1 0% 0 -100%

Father Gerald 5 67% 0 Rangeview 119 34% 5

Featherbrooke Estate 89 -18% 6 -33% Rant-en-Dal 72 36% 26 -51% GaMohale Reservoir Ridge 4 33% 0

Helderblom AH 0 0 Rietfontein AH 11 0% 2 -60% Heuningklip AH Rietvallei Ext 2

Homes Haven 114 84% 286 633% Rietvallei Ext 3

Hospital View 2 -33% 0 Rietvallei SP -100%

Joshua Doore -100% Rietvei AH

Kagiso Central 14 -44% 0 Riverside 7 75% 0 -100%

Kagiso Ext 2 1 -75% 0 Ruimsig Country Estate 37 19% 4 0%

Kagiso Ext 3 3 50% 0 Ruimsig Noord 18 50% 0 -100%

Kagiso Ext 6 32 -24% 0 Silverfields 34 13% 1

Kagiso Ext 8 29 -6% 108 238% Sinqobile Phase 1

Kagiso Ext 9 5 -44% 0 Sinqobile Phase 2 0 60 -39%

Kagiso Ext 10 5 -29% 0 Sinqobile Phase 3 0 -100% 27 -84%

Kagiso Ext 11 8 -43% 0 Sterkfontein 18 38% 1 -50%

Kagiso Ext 12 SP2 4 -60% 0 Tsakane 11 -8% 0

Kagiso Ext 14 -100% Van Wyks Restant AH 1 -50% 4 0%

Kagiso SP 1 -50% 0 Wentworth Park 33 -34% 0

Kenmare 109 2% 2 -88% West Village 28 -3% 2

Krugersdorp Central 46 0% 1 -67% Westrand Consolidated Gold Mine 11 0% 2 -71%

Krugersdorp North 106 12% 5 67% Zwaneville 7 250% 0

Krugersdorp West 76 -24% 0 0 100 200 -200% 0% 200% 0 100 200 300 0% 500% Total Repeat Sales Change in Repeat Sales Total New Sales Change in New Sales Lewisham 47 -2% 0

Source: SA Deeds Registry via Lightstone (Pty) Ltd., 2015. All indicators reflect formal market data as reflected on the deeds registry. Lindley AH -100%

The Housing Development Agency | Mogale City Mining Town Housing Market Report Market Activity: Average Property Values and Sales Prices 10.11 Average Property Values and Sales Price Mogale City, 2007 - 2013 Property value and sales price by suburb R 495K R 542K R 431K The relationship between local sales prices (orange lines) and Agavia R 355K average property values (blue lines) can tell much about the R 121K R 92K activity and integration of supply and demand. Every house Apple Park

R 34K R 34K in a suburb has a value, determined by the number of sales, R 816K R 629K R 699K changes in prices, churn (repeat sales) and other factors Azaadville R 474K present in a robust housing market. Only houses which have

R 1 129K R 887K sold have sales prices, but this lowers the value of homes in Beckedan AH R 794K R 575K markets with fewer sales.

R 501K R 388K Boltonia R 309K R 276K As markets formalise and strengthen, these trends inform

R 1 012K each other more effectively, and the trend lines become R 801K R 956K Breaunanda R 734K almost parallel over time, as is apparent with several suburbs

R 365K R 417K in Mogale City (such as Kagiso Central, Kagiso Krugersdorp R 323K R 363K Burgershoop North and parts of Homes Haven). Sales prices within Kagiso

R 315K Ext 9 have been above their property values in every year. R 267K Chamdor Sales in many areas of Mogale City have been steady R 1 169K R 935K R 1 014K Chancliff AH and values are rising in some areas, indicating steady R 701K active markets. Rising sales prices in affordable areas can

Coronation Park reflect improved access to credit, as well as increasing interest in the neighbourhood. R 977K R 764K R 814K Dan Pienaarville R 729K

Delporton

R 400K R 497K R 358K R 445K Dr Masibilanga

R 414K R 325K Eljeesee AH

Factoria

R 683K R 690K R 492K R 580K Father Gerald

R 3 058K R 2 427K R 2 832K Featherbrooke Estate R 1 903K

R 75K R 49K R 64K GaMohale

R 23K R 3 228K R 2 493K Helderblom AH

Heuningklip AH

R 1 411K R 1 220K

Homes Haven R 940K

R 443K R 665K R 506K R 588K R 424K Hospital View

R 358K R 373K R 258K Joshua Doore R 155K

R 428K R 430K R 309K Kagiso Central R 282K

R 291K R 230K Kagiso Ext 2 R 210K R 200K

R 402K R 307K R 373K Kagiso Ext 3 R 280K

R 472K R 478K R 341K Kagiso Ext 6 R 320K

The Housing Development Agency | Mogale City Mining Town Housing Market R 425K R 306K Kagiso Ext 8 R 302K R 208K

R 509K Kagiso Ext 9 R 291K R 198K R 142K

R 320363K R 654K R 210K Kagiso Ext 10 R 226K R 507K Quellerie Park R 486K R 477K

R 401K R 289K R 359K R 1 001K Kagiso Ext 11 R 258K R 816K Randfontein Estate Gold Mine

R 254K R 253K R 256K R 183K R 1 155K Kagiso Ext 12 SP2 R 924K R 899K R 959K R 115K Rangeview R 32K R 276K R 199K R 1 175K Kagiso Ext 14 R 992K R 943K R 950K Rant-en-Dal R 45K R 25K R 358K R 350K R 247K Kagiso SP R 532K Reservoir Ridge R 383K R 458K R 18K R 305K R 1 055K R 842K R 886K R 868K R 1 065K Kenmare R 811K Rietfontein AH

R 386K R 384K R 290K R 320K R 333K R 173K Krugersdorp Central R 223K R 125K Rietvallei Ext 2

R 758K R 616K R 692K R 606K R 188K Krugersdorp North R 135K Rietvallei Ext 3

R 590K R 453K R 503K R 92K R 441K Krugersdorp West R 66K Rietvallei SP R 65K R 39K R 575K R 443K Lewisham R 393K R 435K Rietvei AH

R 8 775K R 7 013K R 441K Lindley AH R 318K R 376K R 336K R 3 225K R 3 500K Riverside

R 438K R 320K R 2 725K R 333K Luipaardsvlei Estate R 2 165K R 2 385K Ruimsig Country Estate R 1 660K

R 821K R 636K R 1 213K R 1 185K Magaliesburg SP R 941K R 500K R 480K R 1 085K Ruimsig Noord

R 867K Marabeth AH R 693K R 738K R 808K Silverfields

R 133K R 96K Mayibuye Sinqobile Phase 1

R 719K R 573K R 586K R 565K R 32K Mindalore R 21K Sinqobile Phase 2 R 23K R 23K

R 1 130K R 887K R 32K Mogale City NU R 21K Sinqobile Phase 3 R 23K R 23K

R 952K R 782K R 750K R 760K R 504K R 503K Monument R 396K Sterkfontein R 329K

R 701K R 557K R 464K Muldersdrift AH R 470K R 334K Tsakane R 349K

R 261K R 188K R 231K R 1 789K R 1 915K Munsieville SP R 161K Van Wyks Restant AH R 759K R 813K R 1 184K R 996K R 583K R 658K Noordheuwel R 843K R 882K R 515K R 656K Wentworth Park

R 1 609K R 398K R 462K R 1 148K R 1 255K Northvale AH R 362K West Village R 353K R 400K R 1 263K R 1 268K R 624K Oaktree AH R 973K R 500K R 584K R 650K Westrand Consolidated Gold Mine R 439K

R 2 071K R 1 627K R 113K Oatlands AH R 106K Zwaneville R 76K

R 1 577K R 25K R 1 253K R 1 340K 2008 2009 2010 2011 2012 2013 Pinehaven Township R 1 182K Source: SA Deeds Registry via Lightstone (Pty) Ltd., 2015. All indicators reflect formal market data as reflected on the deeds registry. Measure Names R 1 443K Avg Property Value R 1 115K Avg Sales Price Protea Ridge AH

The Housing Development Agency | Mogale City Mining Town Housing Market Report 11. Lending Activity

11.1 Key Findings

Lending is highly concentrated in Mogale City by area and loan size. Bonded sales are almost entirely concentrated in housing and sales over R500 000, with those loans concentrated in the south centre of the city’s higher priced housing markets. While the share of lending by each of the four major banks in the country has remained consistent, lending from non-traditional lenders increased in Mogale City from 2009 to 2013, perhaps due to expanded lending by the existing institutions.

11.12 Policy Implications

Policies and programmes should target expanding access to credit, including the creation of new funds, with broader investment guidelines and possibilities, and small loan programmes with which to make financing more accessible to lower income households. Existing lenders should take lower incomes into account by reducing finance costs.

Loans to entice the development of more middle-market housing would create more integrated markets.

Programmes should make creative finance available for rental projects as well.

11.3 Quick Definitions:

Lending Activity: the performance of key lending indicators over time, such as bond volume, new loans and bonded sales, by lending institution.

Portfolio Size: the total number and value of loans given out by particular lending institutions in the study area

Residential Bond: a loan made for the intention of acquiring a property, which is secured by the title to the property. These are determined by the property address and the timing with which bonds and sales transactions are recorded on the deeds registry.

The Housing Development Agency | Mogale City Mining Town Housing Market All Loans by Lender 11.4 Lending over time Mogale City, 2008 - 2013 Total value of residential bonds by lender Loan data taken from the deeds registry

R 16 000M can provide lending activity by lender, which has grown consistently in the area. R 5 023M By comparing the top chart (all loans R 14 000M

R 4 696M held by each lender) to the bottom chart (lending activity by lender per year), it is R 12 000M R 4 407M possible to note that while the lending R 4 205M R 3 984M R 2 971M in the area has consistently grown, the R 10 000M R 3 797M R 2 677M amount per year varies from lender to R 2 486M lender. For example, annual lending R 8 000M R 2 313M increased considerably from 2009 to R 2 142M R 2 977M R 2 052M R 2 819M 2013 amongst most lenders. Most R 6 000M R 2 675M R 2 545M lenders almost doubled their lending R 2 404M R 2 269M from 2009 to 2013, except Nedbank. R 4 000M R 4 497M R 4 081M R 3 688M Of note has been the infusion of other R 3 316M R 3 063M R 2 000M R 2 951M lenders into the area. These other lenders primarily include companies providing R 1 003M R 1 188M R 1 350M R 0M R 609M R 694M R 794M 2008 2009 2010 2011 2012 2013 home loan benefits to their employees. Source: SA Deeds Registry via Lightstone (Pty) Ltd., 2015. All indicators reflect formal market data as reflected on the deeds registry. Banks ABSA The following charts explore lending FNB Nedbank by bank and by suburb to understand Standard Bank SA specifically where bank investment has Other Lenders been made by suburb, and what that may mean about financing availability for various development sites and scenarios. New Loans by Lender Mogale City, 2008 - 2013 Total value of residential bonds by lender R 1 400M

R 1 300M

R 1 200M R 327M

R 1 100M R 289M R 382M R 1 000M R 202M

R 900M R 294M

R 191M R 800M R 174M R 221M R 179M R 700M

R 130M R 144M R 158M R 600M R 170M

R 252M R 187M R 500M

R 142M R 400M R 372M R 393M R 90M R 416M

R 300M R 135M R 329M R 253M R 200M

R 112M R 100M R 209M R 185M R 162M R 85M R 100M R 0M R 65M 2008 2009 2010 2011 2012 2013 Source: SA Deeds Registry via Lightstone (Pty) Ltd., 2015. All indicators reflect formal market data as reflected on the deeds registry.

Banks ABSA FNB Nedbank SBSA Other Lenders

The Housing Development Agency | Mogale City Mining Town Housing Market Report 11.5 New Loans by Lender

As markets shift, different lenders respond in different ways. These maps show the previous bar charts on a map. The first chart (all loans by lender) is represented on the top map. All loans made in 2013 (the second chart) is shown on the lower map. By comparing the two maps, it’s possible to see where lenders invested loans in the last year (pies in the bottom map), and how that has changed from their overall portfolio in that suburb (pies in the top map). In the top map, areas including Muldersdrift AH, Krugersdorp Central and Magalies SP have bonds from several lenders, yet there is a notable decrease in lending in 2013.

Non-traditional lenders, such as private equity funds and employer lenders, have more flexible regulatory environments and more creative, competitive financing tools. It will be important for Government to engage these investors to ease access to credit, lower costs of financing and share in the commitment towards growing housing markets in the mining towns.

The areas with no dots have no residential properties on the deeds registry – they are farms or open space, mines or power plants, or informal settlements.

New Loans by Lender Helderblom AH 2008 R 0 R 0 R 0 R 0 R 0 Mogale City, 2008 - 2013 2009 R 0 R 0 R 0 R 0 R 0 The value of new bonds by lender by suburb over time 2010 R 0 R 0 R 0 R 0 R 0 2011 R 0 R 0 R 0 R 0 R 0 Mogale City 2012 R 0 R 0 R 0 R 0 R 0 Standard Other ABSA FNB Nedbank 2013 R 0 R 0 R 0 R 0 R 0 Bank Lenders Heuningklip AH 2008 R 0 R 0 R 0 R 0 R 0 Agavia 2008 R 0 R 191,368 R 0 R 765,000 R 0 2009 R 0 R 0 R 0 R 0 R 0 2009 R 0 R 0 R 0 R 0 R 0 2010 R 0 R 0 R 0 R 0 R 0 2010 R 417,000 R 0 R 0 R 777,000 R 500,000 2011 R 0 R 0 R 0 R 0 R 0 2011 R 0 R 0 R 475,000 R 0 R 450,000 2012 R 0 R 0 R 0 R 0 R 0 2012 R 448,000 R 0 R 0 R 1,415,000 R 0 2013 R 0 R 0 R 0 R 0 R 0 2013 R 0 R 350,000 R 0 R 1,135,000 R 0 Homes Haven 2008 R 64,349,768 R 10,581,450 R 17,017,385 R 50,733,912 R 0 Azaadville 2008 R 350,000 R 0 R 0 R 539,000 R 986,000 2009 R 23,858,150 R 8,515,800 R 10,827,527 R 7,768,060 R 0 2009 R 1,920,000 R 585,000 R 402,736 R 0 R 1,560,000 2010 R 15,832,960 R 18,440,178 R 9,401,302 R 16,067,762 R 2,530,000 2010 R 0 R 0 R 505,700 R 525,000 R 2,535,000 2011 R 16,010,052 R 18,573,508 R 14,554,542 R 32,534,265 R 7,559,948 2011 R 0 R 646,000 R 765,000 R 1,110,000 R 2,538,500 2012 R 15,603,783 R 14,688,300 R 4,111,400 R 21,106,600 R 27,920,000 2012 R 0 R 0 R 0 R 2,300,000 R 590,000 2013 R 64,499,758 R 34,918,844 R 22,512,484 R 48,137,086 R 12,521,000 2013 R 0 R 350,000 R 0 R 4,790,000 R 700,000 Hospital View 2008 R 846,900 R 156,000 R 1,000,000 R 440,000 R 0 Beckedan AH 2008 R 0 R 0 R 1,077,705 R 2,620,000 R 0 2009 R 0 R 0 R 0 R 500,000 R 0 2009 R 0 R 0 R 1,004,560 R 0 R 0 2010 R 360,000 R 414,000 R 0 R 1,593,000 R 0 2010 R 183,480 R 0 R 1,100,000 R 585,000 R 0 2011 R 0 R 600,000 R 0 R 0 R 0 2011 R 1,375,000 R 0 R 805,700 R 900,000 R 0 2012 R 0 R 330,000 R 0 R 961,000 R 0 2012 R 0 R 0 R 1,555,700 R 1,055,000 R 1,000,000 2013 R 0 R 946,000 R 0 R 650,000 R 0 2013 R 0 R 0 R 1,072,200 R 2,929,000 R 0 Joshua Doore 2008 R 266,000 R 0 R 131,585 R 172,800 R 36,000 Boltonia 2008 R 0 R 318,000 R 1,480,135 R 1,212,000 R 108,000 2009 R 0 R 80,000 R 0 R 0 R 0 2009 R 681,000 R 275,500 R 372,243 R 0 R 277,133 2010 R 0 R 0 R 0 R 0 R 0 2010 R 268,000 R 1,085,000 R 285,700 R 280,800 R 0 2011 R 0 R 300,000 R 0 R 0 R 0 2011 R 405,000 R 0 R 0 R 1,175,000 R 0 2012 R 245,000 R 0 R 0 R 342,000 R 0 2012 R 1,522,000 R 0 R 0 R 1,140,000 R 790,000 2013 R 0 R 0 R 0 R 0 R 0 2013 R 0 R 375,000 R 0 R 350,000 R 0 Kagiso Central 2008 R 725,000 R 568,914 R 2,636,489 R 4,123,780 R 541,000 Breaunanda 2008 R 3,881,000 R 1,080,000 R 1,015,065 R 3,350,000 R 985,000 2009 R 415,000 R 50,000 R 1,645,741 R 870,500 R 187,987 2009 R 4,120,000 R 0 R 1,929,213 R 3,118,500 R 0 2010 R 857,500 R 66,000 R 1,976,085 R 4,757,500 R 697,000 2010 R 1,224,500 R 2,667,250 R 1,055,700 R 6,023,000 R 1,200,000 2011 R 620,000 R 993,000 R 918,731 R 4,023,000 R 0 2011 R 3,517,500 R 0 R 0 R 3,725,000 R 3,340,000 2012 R 1,754,500 R 780,000 R 0 R 3,468,000 R 0 2012 R 3,440,500 R 2,670,000 R 1,543,400 R 6,310,000 R 3,150,000 2013 R 405,000 R 860,000 R 980,000 R 2,488,300 R 620,000 2013 R 2,100,000 R 5,239,000 R 8,345,700 R 7,177,500 R 1,600,000 Kagiso Ext 2 2008 R 350,000 R 186,000 R 428,734 R 245,000 R 34,000 Burgershoop 2008 R 1,892,000 R 1,019,000 R 1,592,576 R 1,840,000 R 960,000 2009 R 340,000 R 0 R 0 R 0 R 0 2009 R 605,000 R 420,000 R 163,058 R 670,000 R 519,438 2010 R 0 R 0 R 0 R 0 R 0 2010 R 1,085,000 R 525,000 R 0 R 1,410,000 R 920,000 2011 R 0 R 0 R 0 R 1,191,000 R 0 2011 R 165,750 R 380,000 R 243,055 R 2,269,000 R 750,000 2012 R 0 R 270,000 R 0 R 980,000 R 0 2012 R 0 R 0 R 389,000 R 0 R 0 2013 R 0 R 0 R 0 R 0 R 0 2013 R 0 R 0 R 0 R 4,045,000 R 0 Kagiso Ext 3 2008 R 250,000 R 60,000 R 534,093 R 565,000 R 0 Chamdor 2008 R 0 R 0 R 0 R 0 R 0 2009 R 163,000 R 264,000 R 404,146 R 0 R 0 2009 R 0 R 0 R 0 R 0 R 0 2010 R 0 R 0 R 0 R 377,000 R 550,000 2010 R 0 R 0 R 0 R 0 R 0 2011 R 0 R 0 R 0 R 420,000 R 0 2011 R 0 R 0 R 0 R 0 R 0 2012 R 0 R 0 R 545,449 R 350,000 R 0 2012 R 0 R 0 R 0 R 0 R 0 2013 R 340,000 R 0 R 595,000 R 0 R 0 2013 R 0 R 0 R 0 R 0 R 0 Kagiso Ext 6 2008 R 2,581,000 R 1,572,048 R 5,592,755 R 6,798,400 R 815,000 Chancliff AH 2008 R 29,970,000 R 20,327,000 R 18,296,485 R 18,889,500 R 2,910,000 2009 R 1,166,750 R 673,000 R 4,178,647 R 1,467,500 R 440,000 2009 R 9,937,250 R 2,536,350 R 4,282,482 R 3,516,000 R 2,595,000 2010 R 3,310,700 R 1,030,000 R 1,523,844 R 6,125,300 R 0 2010 R 12,120,250 R 1,770,000 R 1,070,700 R 8,531,500 R 2,580,000 2011 R 655,000 R 1,010,000 R 499,526 R 4,469,500 R 0 2011 R 8,524,000 R 7,704,000 R 8,445,341 R 7,802,700 R 7,450,000 2012 R 1,730,000 R 272,000 R 1,555,202 R 9,960,000 R 160,000 2012 R 14,739,000 R 10,133,500 R 15,131,500 R 9,349,500 R 5,270,000 2013 R 3,265,250 R 2,140,600 R 0 R 6,135,800 R 0 2013 R 12,050,000 R 14,892,000 R 8,376,900 R 12,436,290 R 10,190,000 Kagiso Ext 8 2008 R 1,912,000 R 1,671,000 R 5,022,503 R 9,543,800 R 219,000 Dan 2008 R 5,179,000 R 2,914,000 R 3,650,962 R 6,678,000 R 2,990,000 2009 R 2,376,250 R 1,097,600 R 3,820,906 R 562,500 R 450,881 Pienaarville 2009 R 4,781,000 R 1,922,000 R 3,477,896 R 4,076,500 R 980,000 2010 R 2,547,500 R 2,840,000 R 813,260 R 4,839,500 R 0 2010 R 2,599,500 R 3,414,500 R 2,349,165 R 8,752,800 R 4,000,000 2011 R 1,870,000 R 710,000 R 2,616,699 R 9,307,250 R 450,000 2011 R 5,350,000 R 2,579,000 R 5,316,663 R 10,860,500 R 8,815,000 2012 R 990,000 R 2,549,500 R 2,251,618 R 12,972,318 R 0 2012 R 3,188,000 R 9,498,500 R 1,654,700 R 6,226,800 R 7,200,000 2013 R 2,957,897 R 5,161,914 R 6,222,369 R 32,903,005 R 680,000 2013 R 5,489,000 R 15,570,500 R 4,130,000 R 11,587,000 R 5,270,000 Kagiso Ext 9 2008 R 910,000 R 1,177,906 R 2,062,097 R 3,086,000 R 0 Delporton 2008 R 0 R 0 R 0 R 0 2009 R 909,000 R 360,000 R 3,751,334 R 845,854 R 0 2009 R 0 R 0 R 0 R 0 2010 R 0 R 1,250,000 R 0 R 1,122,500 R 242,109 2010 R 0 R 0 R 0 R 0 2011 R 652,000 R 1,080,000 R 770,000 R 4,040,500 R 330,000 2011 R 0 R 0 R 0 R 0 2012 R 0 R 0 R 300,000 R 1,447,000 R 0 2012 R 0 R 0 R 0 R 0 2013 R 0 R 0 R 0 R 1,415,000 R 480,000 2013 R 0 R 0 R 0 R 0 Kagiso Ext 10 2008 R 292,000 R 0 R 0 R 940,000 R 87,000 Dr Masibilanga 2008 R 0 R 0 R 1,107,045 R 1,250,000 R 0 2009 R 0 R 335,000 R 621,849 R 260,000 R 0 2009 R 182,000 R 0 R 0 R 0 R 0 2010 R 0 R 0 R 0 R 756,000 R 0 2010 R 0 R 0 R 853,819 R 0 R 0 2011 R 280,000 R 0 R 0 R 295,000 R 0 2011 R 0 R 0 R 0 R 0 R 0 2012 R 410,000 R 0 R 0 R 593,000 R 0 2012 R 0 R 0 R 0 R 0 R 0 2013 R 0 R 0 R 0 R 895,000 R 0 2013 R 0 R 0 R 0 R 0 R 0 Kagiso Ext 11 2008 R 644,000 R 756,000 R 3,119,009 R 1,681,600 R 0 Eljeesee AH 2008 R 0 R 0 R 0 R 0 R 0 2009 R 550,400 R 595,000 R 1,547,923 R 864,500 R 0 2009 R 0 R 0 R 0 R 0 R 0 2010 R 663,000 R 650,000 R 1,196,155 R 1,868,500 R 0 2010 R 0 R 0 R 0 R 0 R 0 2011 R 897,500 R 345,000 R 345,479 R 3,602,000 R 490,000 2011 R 0 R 0 R 0 R 0 R 0 2012 R 459,000 R 0 R 0 R 4,034,000 R 0 2012 R 0 R 0 R 0 R 0 R 0 2013 R 638,750 R 0 R 0 R 1,706,000 R 0 2013 R 0 R 0 R 0 R 0 R 0 Kagiso Ext 12 2008 R 0 R 0 R 443,766 R 500,000 R 0 Factoria 2008 R 0 R 0 R 0 R 0 R 0 SP2 2009 R 0 R 0 R 0 R 100,000 R 0 2009 R 0 R 0 R 0 R 0 R 0 2010 R 253,000 R 160,000 R 0 R 572,000 R 0 2010 R 0 R 0 R 0 R 0 R 0 2011 R 280,000 R 0 R 0 R 175,000 R 0 2011 R 0 R 0 R 0 R 0 R 0 2012 R 660,000 R 0 R 209,792 R 886,000 R 0 2012 R 0 R 0 R 0 R 0 R 0 2013 R 0 R 0 R 0 R 280,000 R 0 2013 R 0 R 0 R 0 R 0 R 0 Kagiso Ext 14 2008 R 0 R 216,000 R 0 R 165,000 Father Gerald 2008 R 0 R 0 R 575,184 R 850,000 R 0 2009 R 110,000 R 0 R 0 R 0 2009 R 0 R 0 R 602,959 R 0 R 0 2010 R 0 R 0 R 0 R 0 2010 R 0 R 0 R 353,534 R 500,000 R 0 2011 R 0 R 0 R 0 R 659,600 2011 R 420,000 R 0 R 0 R 846,500 R 0 2012 R 0 R 0 R 0 R 0 2012 R 600,000 R 0 R 680,000 R 531,250 R 0 2013 R 0 R 0 R 0 R 0 2013 R 0 R 200,000 R 0 R 1,675,000 R 0 Kagiso SP 2008 R 0 R 0 R 0 R 0 R 0 Featherbrooke 2008 R 58,425,000 R 27,526,000 R 20,532,390 R 48,288,000 R 11,645,000 2009 R 300,000 R 0 R 161,688 R 0 R 0 Estate 2009 R 22,434,275 R 21,757,500 R 9,881,391 R 5,572,500 R 21,605,000 2010 R 0 R 0 R 0 R 0 R 0 2010 R 43,394,000 R 41,341,000 R 24,797,351 R 27,769,500 R 11,170,000 2011 R 400,000 R 0 R 0 R 0 R 0 2011 R 33,760,500 R 18,669,208 R 8,339,200 R 24,695,000 R 35,155,000 2012 R 0 R 0 R 0 R 414,000 R 0 2012 R 38,828,750 R 33,822,500 R 12,485,700 R 35,807,118 R 13,320,000 2013 R 225,000 R 0 R 0 R 0 R 0 2013 R 33,102,000 R 35,575,000 R 16,426,447 R 36,301,700 R 21,131,710 Kenmare 2008 Helderblom AH 2008 33

The Housing Development Agency | Mogale City Mining Town Housing Market 2013 R 225,000 R 0 R 0 R 0 R 0 Kenmare 2008 R 10,603,106 R 4,072,000 R 15,577,223 R 11,124,420 R 8,300,000 2009 R 9,947,000 R 2,545,750 R 6,432,580 R 7,518,000 R 10,323,826 2010 R 15,287,750 R 7,150,000 R 6,503,067 R 14,264,000 R 4,860,000 2013 R 3,345,000 R 1,526,000 R 901,700 R 7,389,500 R 550,000 2011 R 12,853,000 R 10,867,027 R 3,387,229 R 33,506,066 R 13,000,000 Randfontein 2008 R 0 R 0 R 0 R 0 2012 R 12,922,250 R 6,179,000 R 9,803,610 R 26,095,900 R 13,995,810 Estate Gold 2009 R 2,691,615 R 4,339,221 R 2,221,731 R 8,669,364 2013 R 19,974,198 R 13,009,000 R 14,938,250 R 7,286,500 R 11,190,000 Mine 2010 R 0 R 0 R 0 R 950,000 Krugersdorp 2008 R 10,140,760 R 3,194,493 R 5,249,055 R 4,114,000 R 1,225,000 2011 R 0 R 0 R 0 R 234,163 Central 2009 R 3,474,050 R 253,000 R 4,852,463 R 3,733,550 R 340,000 2012 R 0 R 0 R 0 R 602,100 2010 R 420,000 R 1,322,000 R 1,145,617 R 1,426,500 R 0 2013 R 855,000 R 0 R 0 R 0 2011 R 1,092,300 R 640,000 R 887,221 R 1,784,300 R 640,000 Rangeview 2008 R 25,226,900 R 7,508,200 R 11,386,604 R 10,473,600 R 8,080,000 2012 R 1,916,550 R 290,000 R 245,000 R 2,090,000 R 1,080,000 2009 R 12,327,500 R 4,573,750 R 11,078,852 R 5,459,475 R 3,510,000 2013 R 1,389,000 R 270,000 R 453,200 R 1,818,500 R 900,000 2010 R 10,243,500 R 10,223,000 R 9,636,446 R 15,239,700 R 3,970,000 Krugersdorp 2008 R 6,814,000 R 5,203,000 R 7,497,351 R 4,134,700 R 2,660,000 2011 R 10,070,000 R 3,920,500 R 4,982,157 R 15,433,000 R 16,070,000 North 2009 R 2,193,250 R 2,944,500 R 1,615,192 R 1,787,000 R 4,307,500 2012 R 17,030,750 R 11,820,750 R 1,886,200 R 15,862,000 R 10,950,000 2010 R 6,235,000 R 3,030,000 R 6,714,480 R 7,245,000 R 3,885,000 2013 R 12,587,000 R 21,438,850 R 8,229,500 R 16,266,800 R 5,960,000 2011 R 5,486,650 R 4,474,000 R 2,359,321 R 13,651,100 R 9,100,000 Rant-en-Dal 2008 R 6,020,000 R 6,594,600 R 8,546,431 R 8,875,700 R 1,200,000 2012 R 7,975,500 R 4,575,000 R 5,736,300 R 11,688,930 R 10,105,000 2009 R 4,350,000 R 4,620,000 R 0 R 2,275,000 R 3,250,000 2013 R 16,490,450 R 9,240,250 R 4,600,700 R 9,644,000 R 6,155,000 2010 R 8,224,250 R 3,477,500 R 5,907,613 R 5,044,000 R 5,110,000 Krugersdorp 2008 R 3,110,000 R 4,690,000 R 7,693,714 R 5,305,000 R 640,000 2011 R 9,999,000 R 5,123,000 R 920,000 R 11,281,300 R 5,470,000 West 2009 R 2,176,000 R 1,661,500 R 6,183,045 R 1,100,000 R 1,530,000 2012 R 16,938,129 R 6,445,050 R 6,158,700 R 20,459,500 R 8,190,000 2010 R 1,746,000 R 0 R 3,887,792 R 8,051,600 R 3,555,500 2013 R 14,683,100 R 8,885,350 R 11,482,400 R 17,632,700 R 10,170,000 2011 R 3,293,500 R 440,000 R 2,170,953 R 11,596,000 R 4,387,000 Reservoir 2008 R 0 R 0 R 334,800 R 300,000 R 0 2012 R 4,815,000 R 0 R 2,481,400 R 14,231,290 R 4,500,000 Ridge 2009 R 0 R 0 R 476,333 R 0 R 0 2013 R 5,560,000 R 2,089,000 R 2,792,100 R 13,307,950 R 1,870,000 2010 R 0 R 0 R 333,397 R 583,000 R 0 Lewisham 2008 R 3,221,000 R 1,650,000 R 3,683,975 R 1,720,000 R 260,000 2011 R 0 R 0 R 0 R 1,125,000 R 0 2009 R 1,325,000 R 550,000 R 3,084,993 R 1,529,000 R 7,250,000 2012 R 0 R 0 R 0 R 1,260,000 R 0 2010 R 868,000 R 550,000 R 3,511,455 R 5,254,000 R 1,806,000 2013 R 0 R 400,000 R 0 R 0 R 420,000 2011 R 818,150 R 620,000 R 1,026,695 R 4,577,500 R 3,110,000 Rietfontein AH 2008 R 10,137,774 R 10,255,317 R 4,494,936 R 5,525,087 2012 R 1,215,600 R 0 R 1,876,400 R 4,559,500 R 2,060,000 2009 R 0 R 0 R 786,818 R 0 2013 R 1,228,000 R 1,730,000 R 1,472,700 R 6,095,000 R 510,000 2010 R 0 R 0 R 0 R 3,832,226 Lindley AH 2008 R 0 R 6,450,000 R 1,885,130 R 8,800,000 R 0 2011 R 0 R 0 R 0 R 6,821,338 2009 R 0 R 2,000,000 R 0 R 0 R 0 2012 R 612,000 R 0 R 1,987,200 R 5,633,556 2010 R 0 R 8,000,000 R 0 R 5,500,000 R 3,100,000 2013 R 760,000 R 0 R 0 R 3,177,704 2011 R 0 R 21,000,000 R 3,750,000 R 5,640,000 R 0 Rietvallei SP 2008 R 0 R 125,000 2012 R 0 R 0 R 9,000,000 R 0 R 0 2009 R 0 R 0 2013 R 0 R 4,875,000 R 0 R 8,400,000 R 0 2010 R 0 R 0 Luipaardsvlei 2008 R 1,346,841 2011 R 150,000 R 0 Estate 2009 R 0 2012 R 0 R 0 2010 R 0 2013 R 0 R 0 2011 R 0 Rietvei AH 2008 R 0 R 0 2012 R 0 2009 R 0 R 0 2013 R 0 2010 R 0 R 0 Magaliesburg 2008 R 50,000 R 0 R 302,166 R 0 2011 R 0 R 0 SP 2009 R 0 R 0 R 0 R 0 2012 R 0 R 0 2010 R 0 R 0 R 86,981 R 0 2013 R 0 R 0 2011 R 0 R 0 R 0 R 0 Riverside 2008 R 584,000 R 0 R 836,548 R 745,000 R 0 2012 R 0 R 0 R 0 R 0 2009 R 237,000 R 210,000 R 0 R 0 R 0 2013 R 0 R 0 R 0 R 432,000 2010 R 272,000 R 0 R 0 R 1,020,000 R 0 Marabeth AH 2008 R 0 R 0 R 0 R 0 R 0 2011 R 0 R 0 R 202,508 R 648,000 R 0 2009 R 0 R 0 R 0 R 0 R 0 2012 R 0 R 348,000 R 0 R 810,000 R 0 2010 R 0 R 0 R 0 R 0 R 0 2013 R 410,000 R 155,000 R 0 R 1,180,000 R 0 2011 R 0 R 0 R 0 R 0 R 0 Ruimsig 2008 R 13,587,500 R 2,010,000 R 4,853,880 R 5,825,000 R 2,802,280 2012 R 0 R 0 R 0 R 0 R 0 Country Estate 2009 R 4,005,000 R 3,440,000 R 6,986,925 R 5,890,000 R 3,100,000 2013 R 0 R 0 R 0 R 0 R 0 2010 R 16,853,750 R 13,760,000 R 8,621,100 R 10,187,500 R 1,700,000 Mindalore 2008 R 4,250,000 R 7,066,200 R 10,800,979 R 8,785,694 R 2,360,000 2011 R 14,282,000 R 13,163,000 R 11,751,900 R 12,820,000 R 11,405,700 2009 R 4,421,850 R 936,500 R 4,038,709 R 3,541,696 R 2,290,000 2012 R 15,545,235 R 9,637,500 R 12,090,950 R 3,300,000 R 7,485,800 2010 R 5,532,000 R 2,324,999 R 1,351,400 R 7,655,000 R 1,350,000 2013 R 28,129,000 R 16,505,000 R 3,600,000 R 8,061,000 R 8,150,000 2011 R 3,687,500 R 6,915,750 R 5,424,867 R 16,465,505 R 6,360,000 Ruimsig Noord 2008 R 997,500 R 0 R 650,000 R 1,210,000 R 280,000 2012 R 5,191,136 R 6,679,250 R 4,357,600 R 16,767,000 R 7,470,000 2009 R 0 R 1,755,000 R 0 R 0 R 420,000 2013 R 6,251,700 R 4,307,300 R 7,166,900 R 15,229,263 R 3,400,000 2010 R 4,862,000 R 4,820,000 R 2,522,500 R 980,000 R 830,000 Mogale City NU 2008 R 0 R 0 R 0 2011 R 1,071,000 R 1,301,000 R 800,000 R 1,825,000 R 0 2009 R 0 R 0 R 0 2012 R 3,551,000 R 3,883,250 R 0 R 7,123,000 R 0 2010 R 0 R 0 R 0 2013 R 1,125,000 R 2,864,500 R 1,576,200 R 7,254,000 R 0 2011 R 0 R 0 R 0 Silverfields 2008 R 1,980,000 R 1,332,000 R 2,747,638 R 2,320,000 R 0 2012 R 0 R 0 R 0 2009 R 1,410,000 R 510,000 R 1,193,700 R 450,000 R 810,000 2013 R 0 R 0 R 0 2010 R 3,545,000 R 1,940,000 R 0 R 5,190,000 R 1,060,000 Monument 2008 R 9,833,143 R 1,886,800 R 5,478,844 R 7,019,500 R 400,000 2011 R 2,991,500 R 450,000 R 4,205,990 R 8,314,300 R 2,040,000 2009 R 3,585,000 R 1,399,000 R 1,950,500 R 3,242,000 R 1,100,000 2012 R 3,023,000 R 2,795,000 R 1,340,700 R 5,550,000 R 0 2010 R 8,079,500 R 3,740,000 R 5,477,800 R 11,739,500 R 3,600,000 2013 R 6,605,500 R 3,550,000 R 2,002,900 R 9,208,000 R 0 2011 R 6,338,500 R 3,304,000 R 2,998,885 R 16,818,500 R 9,310,000 Sterkfontein 2008 R 2,146,600 R 1,440,000 R 2,146,730 R 2,050,000 R 0 2012 R 9,132,000 R 520,000 R 3,327,200 R 8,835,500 R 7,650,000 2009 R 0 R 360,000 R 1,381,000 R 277,500 R 0 2013 R 7,616,000 R 8,461,900 R 4,129,400 R 10,538,500 R 7,110,000 2010 R 1,430,000 R 0 R 310,896 R 416,500 R 0 Muldersdrift 2008 R 0 R 0 R 0 R 0 2011 R 0 R 0 R 0 R 0 R 0 AH 2009 R 0 R 0 R 0 R 0 2012 R 0 R 155,000 R 300,000 R 2,011,500 R 4,200,000 2010 R 0 R 0 R 0 R 0 2013 R 7,137,000 R 185,000 R 0 R 510,000 R 2,840,000 2011 R 0 R 0 R 0 R 0 Tsakane 2008 R 1,125,000 R 768,037 R 2,760,311 R 1,124,500 R 0 2012 R 0 R 0 R 0 R 0 2009 R 0 R 60,000 R 507,151 R 619,100 R 0 2013 R 0 R 0 R 0 R 0 2010 R 0 R 0 R 0 R 2,136,500 R 0 Munsieville SP 2008 R 1,209,800 R 0 R 654,504 R 850,000 R 0 2011 R 437,000 R 380,000 R 655,700 R 1,686,000 R 0 2009 R 391,000 R 687,500 R 645,201 R 275,000 R 91,974 2012 R 315,000 R 0 R 650,000 R 2,585,500 R 1,190,000 2010 R 0 R 0 R 318,295 R 0 R 0 2013 R 0 R 0 R 410,700 R 3,237,000 R 500,000 2011 R 692,500 R 0 R 0 R 225,000 R 0 Van Wyks 2008 R 0 R 0 2012 R 536,000 R 0 R 0 R 855,000 R 0 Restant AH 2009 R 0 R 0 2013 R 306,000 R 2,920,000 R 0 R 1,295,500 R 0 2010 R 0 R 0 Noordheuwel 2008 R 60,140,770 R 32,601,405 R 41,064,394 R 43,997,436 R 8,196,325 2011 R 0 R 0 2009 R 40,778,901 R 14,482,053 R 15,933,638 R 22,175,574 R 8,560,000 2012 R 0 R 3,800,000 2010 R 29,490,700 R 21,783,135 R 20,599,865 R 27,360,500 R 25,910,000 2013 R 4,350,000 R 2,680,000 2011 R 36,553,922 R 39,081,534 R 29,298,001 R 55,175,355 R 29,698,000 Wentworth 2008 R 4,292,000 R 0 R 4,763,014 R 3,236,000 R 700,000 2012 R 78,644,985 R 49,008,000 R 31,297,330 R 77,669,109 R 28,260,000 Park 2009 R 1,493,000 R 841,000 R 1,608,094 R 1,115,000 R 1,170,000 2013 R 51,219,630 R 63,100,925 R 18,436,400 R 52,261,050 R 31,186,760 2010 R 1,513,500 R 1,072,500 R 695,000 R 3,134,500 R 2,810,000 Northvale AH 2008 R 0 R 0 R 0 R 0 R 0 2011 R 3,232,500 R 1,218,000 R 480,000 R 7,371,300 R 2,140,000 2009 R 0 R 0 R 0 R 0 R 0 2012 R 4,078,000 R 480,000 R 2,119,300 R 8,240,600 R 1,480,000 2010 R 0 R 0 R 0 R 0 R 0 2013 R 3,229,920 R 935,000 R 0 R 8,285,500 R 1,780,000 2011 R 0 R 0 R 1,500,000 R 0 R 0 West Village 2008 R 3,825,000 R 450,000 R 1,974,809 R 1,771,000 R 525,000 2012 R 0 R 0 R 0 R 0 R 0 2009 R 2,008,300 R 336,000 R 585,586 R 1,158,000 R 360,000 2013 R 0 R 0 R 0 R 0 R 0 2010 R 843,000 R 800,000 R 869,850 R 1,165,000 R 680,000 Oaktree AH 2008 R 0 R 0 R 0 R 0 R 0 2011 R 1,057,250 R 0 R 0 R 3,657,000 R 2,020,000 2009 R 4,745,100 R 0 R 905,700 R 1,700,000 R 1,200,000 2012 R 1,625,000 R 0 R 0 R 3,327,100 R 0 2010 R 0 R 0 R 0 R 750,000 R 500,000 2013 R 1,782,400 R 893,500 R 790,000 R 2,669,100 R 0 2011 R 0 R 0 R 0 R 0 R 0 Westrand 2008 R 699,000 R 0 R 2,494,441 R 0 R 875,000 2012 R 0 R 0 R 0 R 0 R 0 Consolidated 2009 R 600,000 R 0 R 478,847 R 1,469,100 R 1,800,000 2013 R 0 R 0 R 0 R 2,320,000 R 0 Gold Mine 2010 R 5,717,300 R 0 R 4,729,044 R 7,662,000 R 5,540,000 Oatlands AH 2008 R 0 R 0 R 0 R 0 R 0 2011 R 1,846,000 R 0 R 1,263,800 R 8,643,644 R 10,880,000 2009 R 0 R 0 R 0 R 0 R 0 2012 R 1,835,650 R 0 R 1,606,100 R 2,518,199 R 700,000 2010 R 0 R 0 R 0 R 0 R 0 2013 R 1,116,000 R 586,500 R 0 R 3,807,900 R 0 2011 R 0 R 0 R 0 R 0 R 0 Zwaneville 2008 R 0 R 0 R 400,000 2012 R 0 R 0 R 0 R 0 R 0 2009 R 0 R 0 R 0 2013 R 0 R 0 R 0 R 0 R 0 2010 R 0 R 0 R 0 Pinehaven 2008 R 10,543,000 R 3,800,000 R 6,474,415 R 15,158,057 R 4,290,000 2011 R 0 R 227,679 R 315,000 Township 2009 R 8,607,295 R 1,825,000 R 9,064,788 R 5,551,000 R 4,395,000 2012 R 0 R 0 R 0 2010 R 12,403,500 R 8,918,000 R 9,466,610 R 10,862,200 R 2,650,000 2013 R 340,000 R 0 R 265,000 2011 R 8,664,000 R 6,005,760 R 6,612,900 R 13,738,500 R 11,010,000 2012 R 14,567,500 R 11,990,500 R 4,015,400 R 21,376,000 R 10,075,000 Source: South African Deeds Registry via Lightstone (Pty) Ltd, 2015. All indicators reflect formal market data as reflected on 2013 R 9,953,500 R 9,272,500 R 6,675,700 R 17,350,369 R 13,230,000 the deeds registry. Protea Ridge 2008 R 0 R 0 R 0 R 0 R 0 Banks AH 2009 R 0 R 0 R 0 R 0 R 0 ABSA 2010 R 0 R 0 R 0 R 0 R 0 FNB 2011 R 0 R 0 R 0 R 0 R 0 Nedbank 2012 R 0 R 0 R 0 R 0 R 0 Standard Bank 2013 R 0 R 0 R 0 R 0 R 0 Other Lenders Quellerie Park 2008 R 17,662,600 R 7,443,046 R 9,991,184 R 8,579,692 R 200,000

The Housing Development Agency | Mogale City Mining Town Housing Market Report Market Share by Lender: All Residential Bonds 11.6 Market Share Mogale City, all loans, by suburb by lender, through 2013

Rietfontein AH Understanding market share at the local level is key to understanding the potential for end-user finance, where gaps might exist, and how to make the case for more lending. Most suburbs in Mogale City experienced some lending over the past six years. However, 9 suburbs out of 79 show no lending at all over the six year period.

Lindley AH Mogale City NU Comparing lending over time and

Magaliesburg SP by suburb also shows which lenders perceive value or risk.

Oaktree AH Muldersdrift AH Protea Ridge AH Pinehaven Township Van Wyks Restant AH Ruimsig Noord Munsieville SP Featherbrooke Estate Krugersdorp North Ruimsig Country Estate Krugersdorp Central Wentworth Park Krugersdorp West Boltonia Kagiso Ext 3 Kagiso Ext 10 Dr Masibilanga Westrand Consolidated Gold Mine

Kagiso Central Reservoir Ridge Kagiso Ext 14 Kagiso Ext 12 SP2

Source: South African Deeds Registry via Lightstone (Pty) Ltd. All indicators reflect formal market data as reflected on the deeds registry.

Total Residential Bonds Lenders 0 ABSA 1000 FNB 2000 Nedbank 3000 Standard Bank 4000 Other Lenders ≥ 5000

Market Share by Lender: New Loans 2013 Mogale City, all new loans made, by suburb by lender, 2013

Rietfontein AH

Lindley AH Mogale City NU

Magaliesburg SP

Muldersdrift AH Protea Ridge AH Pinehaven Township Van Wyks Restant AH Ruimsig Country Estate Krugersdorp North

Krugersdorp Central Featherbrooke Estate Noordheuwel Krugersdorp West Luipaardsvlei Estate Wentworth Park Reservoir Ridge Westrand Consolidated Gold Mine Kagiso Ext 14 Kagiso Central Kagiso Ext 11

Zwaneville

Source: South African Deeds Registry via Lightstone (Pty) Ltd. All indicators reflect formal market data as reflected on the deeds registry.

New Residential Bonds Lenders 0 ABSA 50 FNB 100 Nedbank ≥ 150 Standard Bank Other Lenders

The Housing Development Agency | Mogale City Mining Town Housing Market 12. Leverage

12.1 Key Findings

The presence of older Government-sponsored units within the municipality represent an important opportunity to leverage that investment in affordable housing in the years ahead, as owners seek to sell and move up the housing continuum, if opportunities are positioned properly. About 11% of all registered properties in Mogale City were sponsored by the Government. The value of these homes if sold in the private market can be applied towards the cost of a new home.

This situation can be used to drive developers to build more gap housing, and financiers to finance low cost acquisition loans.

12.2 Policy Implications

Policies should focus on enticing developers to build more housing in the gap market, and encourage lending to the RDP and other lower cost home markets.

To encourage an increase in the supply of gap housing, Government can unlock sites, supply infrastructure or grants, or hook-up fee discounts. Government can also reduce the cost of construction finance, which can all be passed down to the buyers in the form of lower sales prices.

Government can create programmes using funds pooled from a range of Government and private sector partners, which provide bonds for small properties, and offset risks through loan guarantees, loan loss reserves, and interest rate discounts. Funds can also organise to implement homebuyer counselling, debt consolidation and moderate rehab costs of the existing home to ensure loan performance of the portfolio.

These programmes would work together in the mining towns to create better social, housing and economic integration. In Mogale City, this might be areas between Homes Haven and Sterkfontein, higher priced more active markets, and Kagiso Central.

12.3 Quick Definitions:

Leverage: the ability to use the percentage of the property that has been paid off as a down payment for another property.

Equity: the value of the residential property less the outstanding balance of the bond. This represents the value of ownership built up in a property, and is often used as the down payment for the owner’s next house purchased up the housing ladder.

The Housing Development Agency | Mogale City Mining Town Housing Market Report Average Equity to Average Sales Price 12.4 Equity Fills the Gap Mogale City, 2013 The value of average home equity related to the average sales price R 355K Agavia R 276K Equity is the value of one’s home less the Azaadville R 755K R 699K

Beckedan AH R 668K R 794K amount owed to the lender. The chart shows R 276K Boltonia R 293K the average equity per suburb (the green Breaunanda R 685K R 956K bar) compared to the average sales price R 363K Burgershoop R 257K per suburb. This helps to show what portion Chamdor R 315K

Chancliff AH R 598K R 1 014K of the sales price might be paid for by the Dan Pienaarville R 633K R 814K homeowners’ equity. If a homeowner in Delporton Kagiso Central wished to purchase a home in Dr Masibilanga R 473K

Eljeesee AH R 315K Home Haven, they could sell their home and Factoria apply it towards the cost of the new home, Father Gerald R 630KR 580K reducing the amount they would have to Featherbrooke Estate R 1 515K R 2 832K

Helderblom AH R 3 228K borrow. Instead of borrowing over R940 000 Heuningklip AH (the average sales price), they would only Homes Haven R 850K R 940K need about R470 000 (the orange bar in R 665K Hospital View R 523K Homes Haven minus the green bar in Kagiso Joshua Doore R 347K R 430K Kagiso Central R 413K Central). Thus, equity makes homeownership R 200K Kagiso Ext 2 R 276K in higher priced neighbourhoods affordable, R 373K Kagiso Ext 3 R 357K expanding housing options. Equity closes the Kagiso Ext 6 R 409KR 478K R 208K Kagiso Ext 8 R 341K housing gap for less affluent homeowners Kagiso Ext 9 R 63K R 509K because their properties are less likely to have Kagiso Ext 10 R 256KR 363K R 359K a bond, and those markets have experienced Kagiso Ext 11 R 315K R 115K Kagiso Ext 12 SP2 R 251K more appreciation of value. It is important Kagiso Ext 14 R 273K to consider this value in addition to a R 350K Kagiso SP R 353K homeowner’s income. Kenmare R 677K R 868K R 223K Krugersdorp Central R 214K

Krugersdorp North R 521K R 692K Equity invested by homeowners also reduces Krugersdorp West R 378K R 503K risk by increasing their financial stake Lewisham R 367KR 435K in their home. This is the same way upper- Lindley AH R 4 595K

Luipaardsvlei Estate R 378K income families move up the housing R 480K Magaliesburg SP R 706K continuum, and is now available at scale for Marabeth AH lower-income families, thanks to the massive Mindalore R 448K R 565K

Mogale City NU R 1 130K Government investment in homes for the Monument R 612K R 760K poor. This requires financing for the lower Muldersdrift AH R 493K income buyers, something to explore with R 231K Munsieville SP R 250K lender partners. Noordheuwel R 692K R 882K

Northvale AH R 1 357K R 650K Oaktree AH R 917K While averages in such diverse housing Oatlands AH R 2 064K markets are hard to consider meaningfully, the Pinehaven Township R 501K R 1 340K

Protea Ridge AH R 1 413K picture does indicate that purchasing power Quellerie Park R 331K R 477K increases (and gaps close) when equity is R 256K Randfontein Estate Gold Mine R 817K taken into consideration. Rangeview R 708K R 959K

Rant-en-Dal R 771K R 950K R 458K Reservoir Ridge R 474K R 386K Rietfontein AH R 367K

Rietvallei SP R 91K Rietvei AH R 376K Riverside R 413K

Ruimsig Country Estate R 842K R 2 385K

Ruimsig Noord R 376K R 1 085K

Silverfields R 576K R 808K R 329K Sterkfontein R 417K Tsakane R 420KR 470K R 813K Van Wyks Restant AH R 1 768K

Wentworth Park R 423K R 656K

West Village R 185K R 353K

Westrand Consolidated Gold Mine R 296K R 584K R 113K Zwaneville R 105K R 0K R 500K R 1 000K R 1 500K R 2 000K R 2 500K R 3 000K Avg Sales Price Source: SA Deeds Registry via Lightstone (Pty) Ltd., 2015. All indicators reflect formal market data as reflected on the deeds registry.

Measure Names Avg Sales Price Avg Value of Residential Equity

The Housing Development Agency | Mogale City Mining Town Housing Market 12.5 Accessing Equity Closes 5 Year Equity Growth Mogale City, 2013 the Housing Gap and can Drive Rates of equity growth, since 2007 to 2013 Demand

Lindley AH Understanding the difference in equity growth rates on a map allows a better understanding Mogale City NU of which property markets can be leveraged

Magaliesburg SP to support more new development. Many GaMohale higher priced areas have experienced modest Muldersdrift AH Oaktree AH equity growth (grey areas) or loss (red Rietfontein AH Protea Ridge AH Rietvei AH areas) over the past five years. This may be Heuningklip AH Marabeth AH Ruimsig Noord due to increasing sales prices (rather than Beckedan AH Featherbrooke Estate amortization as new buyers tend to have Eljeesee AH Rangeview Helderblom AH less equity, and this market has been very Kenmare Randfontein Estate Gold Mine Breaunanda active recently). The greatest equity growth Westrand Consolidated Gold Mine over five years (green areas and green lines) Mindalore Riverside Chamdor has been in less developed areas with fewer Azaadville Hospital View sales, and values have accrued to the existing Rietvallei Ext 2 Kagiso Ext 12 SP2 Zwaneville Rietvallei SP Mayibuye homeowners. Homes worth less than R500 Rietvallei Ext 3 000 typically have fewer loans, a faster-

Source: Stats SA Census, 2011, South African Deeds Registry via Lightstone (Pty) Ltd, 2015. All indicators re- growing value, and an initial housing cost flect formal market data as reflected on the deeds registry. that was low or free (thanks to Government Total Residential properties Avg value of Equity 0 investment in housing). Homebuyers can 1 000 -21,40% 60,00% 2 000 reduce the amount they have to borrow 3 000 through savings or the equity in their home, ≥ 4 000 if they have an existing house which they can sell. This lowers their monthly payment or Growth in Equity increases the price they can afford. Leverage is the practice of using this equity to increase Mogale City, 2008- 2013 their housing affordability. This indicator The change in the value of average home equity from thus becomes very useful for meeting – and 2008 closing – the housing gap. 43% Constraints to using leverage in affordable 40% 42% housing markets include the availability of credit for potential buyers to pay the full value of the house; maximising the equity 32% available to the homeowner, the availability 30% of homes up the housing ladder to buy; and 30% in the case of RDP owners; the ability to sell 23% Government subsidised stock (which comes with an eight-year resale restriction). Other 20% 21% constraints include household indebtedness, and the willingness of existing homeowners 15% to sell their most important asset. 15% 10% However, policies which address these constraints can expand the housing ladder 4% in remarkably quick and cost-effective ways. 6% Closing cost assistance, interest rate write Change in Value of Residential Equity Residential Changeof Value in 0% downs, and loan loss funds all cost a fraction 0% 0% of new construction, and put the opportunity, 2008 2009 2010 2011 2012 2013 and choice, in the hands of the homeowner, rather than the Government. Source: SA Deeds Registry via Lightstone (Pty) Ltd., 2015. All indicators reflect formal market data as reflected on the deeds registry. Change in Equity Affordable properties (under R500 000) All residential properties

The Housing Development Agency | Mogale City Mining Town Housing Market Report 13. Affordability Profile

13.1 Key Findings

Mogale City’s affordability ratio of 2.2 is below the mining town average of 2.8, which means that it takes a little more than two times the average municipality income to afford the average house there. Despite an above-average monthly income, there remain large disparities among incomes and affordable housing access in certain areas within the municipality. In some areas, sales prices used to determine affordability are very low, probably the result of lack of credit access, forcing sellers to sell for whatever cash might be offered regardless of how much the house may be worth.

13.2 Policy Implications

Affordability constraints due to below-average incomes can be addressed through housing strategies and solutions, which propose creative financing tools and techniques can reduce financial barriers (such as down payments, interest rates and principal requirements) as well as unlocking equity, rather than simply trying to push costs down.

Lowering the cost of financing can also increase the amount that can be borrowed, which can increase sales prices and the amount of equity a home seller will be able to access to buy their next home.

Lack of adequate affordable supply in areas with very low incomes can often be quickly addressed through the careful considered provision of well-located quality rental housing.

13.3 Quick Definitions:

Affordability: affordability is generally defined as the ability to allocate less than 25-30% of a household’s monthly income towards housing costs. While upper income families’ income enables them to cover the cost of producing and selling a housing unit and thus provides many housing options, lower income families struggle because their income often does not adequately cover the cost of producing and selling a housing unit. Supply is limited and others must collaborate to provide decent affordable housing.

Affordability Ratio: the purchasing power of local incomes to afford local sales prices. The local average sales price is divided by the target house price. This shows the relationship between local incomes and local sales prices – a larger number means that local sales prices are harder for local incomes to afford, implying a mismatch between local housing options and residents.

Housing Gap: the shortfall between the target house price a household can afford and the sales price (or construction cost) of a house. This can be calculated by the difference between the target affordable price and the cost or price of the house.

Target House Price: the sales price affordable to local households, which is calculated using the average area median income available for housing (25% of monthly income) using standard underwriting criteria (typically 20 year amortization at 11%, with 5% down).

The Housing Development Agency | Mogale City Mining Town Housing Market 13.4 Affordability

Actual affordability relies on understanding local household income to determine what is reasonably afforded by existing residents, how much of a gap exists and what is required to ensure more realistic affordability. The Affordability Ratio is determined by dividing the purchase price affordable to the average household income by the average sales price. Nationally, it takes three times the average income to afford the average sales price. This doesn’t mean that families are paying that, it means that most homes on the deeds registry are not affordable to the majority of South Africans. But this indicator provides an important benchmark, by providing a sense of affordability levels, and how well local markets might be meeting the needs of local residents.

In Mogale City, there appear to be gaps in affordability in many markets, as shown by the negative price gap, the amount by which local sales prices are higher than what’s affordable to local residents. Price gaps in Van Wyks Restant AH and Sterkfontein are negative, perhaps the result of more recent housing development which drove up recent sales prices past income levels.

Introducing new products or strategies are more likely to be sustainable if they are responsive to current residents. The target home price in column 2 can also be compared to estimated potential per-unit construction costs to determine the amount of subsidy which may be required to build and sell the units to local residents.

Mind the Gap Table Lewisham R 12K R 309K R 435K R -126K 1.4 Mogale City, 2013 Lindley AH R 5K R 129K Affordability indicators per suburb Luipaardsvlei Estate R 5K R 130K Avg Monthly Target house Average Affordable Affordability Subplace Name Income price Sales Price Price Gap Ratio Magaliesburg SP R 8K R 222K R 480K R -258K 2.2

Marabeth AH R 25K R 657K Agavia R 16K R 413K R 355K R 58K 0.9 Mayibuye R 3K R 73K Apple Park R 10K R 273K Mindalore R 25K R 657K R 565K R 92K 0.9 Azaadville R 12K R 327K R 699K R -372K 2.1 Mogale City NU R 10K R 256K Beckedan AH R 14K R 380K R 794K R -414K 2.1 Monument R 31K R 811K R 760K R 52K 0.9 Boltonia R 17K R 452K R 276K R 176K 0.6 Muldersdrift AH R 13K R 354K Breaunanda R 37K R 981K R 956K R 24K 1.0 Munsieville SP R 5K R 123K R 231K R -107K 1.9 Burgershoop R 8K R 219K R 363K R -144K 1.7 Noordheuwel R 38K R 991K R 882K R 110K 0.9 Chamdor R 8K R 219K Northvale AH R 8K R 216K Chancliff AH R 33K R 862K R 1,014K R -152K 1.2 Oaktree AH R 20K R 526K R 650K R -124K 1.2 Coronation Park R 3K R 71K Oatlands AH R 7K R 182K Dan Pienaarville R 31K R 828K R 814K R 14K 1.0 Pinehaven Township R 50K R 1,326K R 1,340K R -13K 1.0 Delporton R 5K R 133K Protea Ridge AH R 18K R 465K Dr Masibilanga R 10K R 265K Quellerie Park R 20K R 532K R 477K R 55K 0.9 Eljeesee AH R 6K R 168K Randfontein Estate Gold Mine R 20K R 529K R 256K R 273K 0.5 Factoria R 16K R 413K Rangeview R 35K R 926K R 959K R -32K 1.0 Father Gerald R 22K R 588K R 580K R 8K 1.0 Rant-en-Dal R 36K R 938K R 950K R -13K 1.0 Featherbrooke Estate R 86K R 2,279K R 2,832K R -554K 1.2 Reservoir Ridge R 19K R 493K R 458K R 35K 0.9 GaMohale R 4K R 98K Rietfontein AH R 6K R 166K R 386K R -220K 2.3 Helderblom AH R 15K R 397K Rietvallei Ext 2 R 2K R 63K Heuningklip AH R 7K R 175K Rietvallei Ext 3 R 3K R 72K Homes Haven R 40K R 1,043K R 940K R 103K 0.9 Rietvallei SP R 3K R 87K Hospital View R 18K R 471K R 665K R -194K 1.4 Rietvei AH R 7K R 179K Joshua Doore R 9K R 247K Riverside R 10K R 258K R 376K R -119K 1.5 Kagiso Central R 5K R 141K R 430K R -289K 3.0 Ruimsig Country Estate R 67K R 1,779K R 2,385K R -606K 1.3 Kagiso Ext 2 R 6K R 170K R 200K R -30K 1.2 Ruimsig Noord R 18K R 476K R 1,085K R -609K 2.3 Kagiso Ext 3 R 11K R 289K R 373K R -84K 1.3 Silverfields R 36K R 946K R 808K R 138K 0.9 Kagiso Ext 6 R 14K R 371K R 478K R -107K 1.3 Sinqobile Phase 1 R 3K R 84K Kagiso Ext 8 R 9K R 244K R 208K R 36K 0.9 Sinqobile Phase 2 R 3K R 87K R 23K R 64K 0.3 Kagiso Ext 9 R 13K R 356K R 509K R -152K 1.4 Sinqobile Phase 3 R 3K R 87K R 23K R 64K 0.3 Kagiso Ext 10 R 7K R 186K R 363K R -177K 2.0 Sterkfontein R 3K R 79K R 329K R -250K 4.2 Kagiso Ext 11 R 15K R 390K R 359K R 31K 0.9 Tsakane R 8K R 208K R 470K R -262K 2.3 Kagiso Ext 12 SP2 R 4K R 97K R 115K R -18K 1.2 Van Wyks Restant AH R 4K R 106K R 813K R -707K 7.7 Kagiso Ext 14 R 4K R 116K Wentworth Park R 22K R 593K R 656K R -63K 1.1 Kagiso SP R 3K R 83K R 350K R -267K 4.2 West Village R 7K R 180K R 353K R -173K 2.0 Kenmare R 29K R 771K R 868K R -97K 1.1 Westrand Consolidated Gold Mine R 18K R 464K R 584K R -120K 1.3 Krugersdorp Central R 9K R 245K R 223K R 22K 0.9 Zwaneville R 3K R 71K R 113K R -42K 1.6 Krugersdorp North R 24K R 635K R 692K R -57K 1.1

Source: StatsSA Census 2011 (with CPI increase); South African Deeds Registry via Lightstone (Pty) Ltd, 2015. All indicators reflect formal market data as reflected on the Krugersdorp West R 12K R 316K R 503K R -187K 1.6 deeds registry.

Lewisham R 12K R 309K R 435K R -126K 1.4

The Housing Development Agency | Mogale City Mining Town Housing Market Report 13.5 Mind the Gap

This chart is identical to the previous chart but shows bar lines to better visualise differences across the area. These tables measure relative affordability for each suburb in the target area in three ways: starting with the average income (column 1), it calculates the average sales price affordable to the average family using standard underwriting terms (5% down, 11% for 20 years, up to 25% of household income, column 2). It compares that to the area’s average sales price (column 3). Column 4 (“Affordable Price Gap”) shows the difference between the average sales price and the local target (affordable) house price. Column 5 divides the two values to show the affordability ratio, the number of times it might take the local income to afford the local sales price. For example, in Kagiso SP, it takes 4.2 times the average income to afford the average sales price.

In Mogale City, the average income is about R13 700, the average target house price is R362 000 (how much house that income can afford), and the average sales price is R830 000. Thus, in 2013, it took over twice the average income to afford the average house. These very high level indicators are useful when comparing affordability, to see which areas are more or less affordable. This helps one to understand how housing strategies need to address affordability within the town, including what resources or policies might be required to help fill these gaps (ie affordable financing, buyer subsidies).

When affordability is an issue, perhaps equity of existing homeowners can help fund the gap. Policies will need to encourage the sale of lower cost homes that can allow housing purchases further upstream for lower income households.

Magaliesburg SP Mind the Gap Chart R 8K R 222K R 480K R -258K 2.2 Mogale City, 2013 Marabeth AH R 25K R 657K Affordability indicators per suburb Mayibuye R 3K R 73K Agavia R 16K R 413K R 355K R 58K 0.9

Mindalore R 25K R 657K R 565K R 92K 0.9 Apple Park R 10K R 273K

Mogale City NU R 10K R 256K Azaadville R 12K R 327K R 699K R -372K 2.1

Monument R 31K R 811K R 760K R 52K 0.9 Beckedan AH R 14K R 380K R 794K R -414K 2.1

Muldersdrift AH R 13K R 354K Boltonia R 17K R 452K R 276K R 176K 0.6

Munsieville SP R 5K R 123K R 231K R -107K 1.9 Breaunanda R 37K R 981K R 956K R 24K 1.0

Noordheuwel R 38K R 991K R 882K R 110K 0.9 Burgershoop R 8K R 219K R 363K R -144K 1.7

Northvale AH R 8K R 216K Chamdor R 8K R 219K

Oaktree AH R 20K R 526K R 650K R -124K 1.2 Chancliff AH R 33K R 862K R 1,014K R -152K 1.2

Oatlands AH R 7K R 182K Coronation Park R 3K R 71K

Pinehaven Township R 50K R 1,326K R 1,340K R -13K 1.0 Dan Pienaarville R 31K R 828K R 814K R 14K 1.0

Protea Ridge AH R 18K R 465K Delporton R 5K R 133K

Quellerie Park R 20K R 532K R 477K R 55K 0.9 Dr Masibilanga R 10K R 265K

Randfontein Estate Gold Mine R 20K R 529K R 256K R 273K 0.5 Eljeesee AH R 6K R 168K

Rangeview R 35K R 926K R 959K R -32K 1.0 Factoria R 16K R 413K

Rant-en-Dal R 36K R 938K R 950K R -13K 1.0 Father Gerald R 22K R 588K R 580K R 8K 1.0

Reservoir Ridge R 19K R 493K R 458K R 35K 0.9 Featherbrooke Estate R 86K R 2,279K R 2,832K R -554K 1.2

Rietfontein AH R 6K R 166K R 386K R -220K 2.3 GaMohale R 4K R 98K

Rietvallei Ext 2 R 2K R 63K Helderblom AH R 15K R 397K

Rietvallei Ext 3 R 3K R 72K Heuningklip AH R 7K R 175K

Rietvallei SP R 3K R 87K Homes Haven R 40K R 1,043K R 940K R 103K 0.9

Rietvei AH R 7K R 179K Hospital View R 18K R 471K R 665K R -194K 1.4

Riverside R 10K R 258K R 376K R -119K 1.5 Joshua Doore R 9K R 247K

Ruimsig Country Estate R 67K R 1,779K R 2,385K R -606K 1.3 Kagiso Central R 5K R 141K R 430K R -289K 3.0

Ruimsig Noord R 18K R 476K R 1,085K R -609K 2.3 Kagiso Ext 2 R 6K R 170K R 200K R -30K 1.2

Silverfields R 36K R 946K R 808K R 138K 0.9 Kagiso Ext 3 R 11K R 289K R 373K R -84K 1.3

Sinqobile Phase 1 R 3K R 84K Kagiso Ext 6 R 14K R 371K R 478K R -107K 1.3

Sinqobile Phase 2 R 3K R 87K R 23K R 64K 0.3 Kagiso Ext 8 R 9K R 244K R 208K R 36K 0.9

Sinqobile Phase 3 R 3K R 87K R 23K R 64K 0.3 Kagiso Ext 9 R 13K R 356K R 509K R -152K 1.4

Sterkfontein R 3K R 79K R 329K R -250K 4.2 Kagiso Ext 10 R 7K R 186K R 363K R -177K 2.0

Tsakane R 8K R 208K R 470K R -262K 2.3 Kagiso Ext 11 R 15K R 390K R 359K R 31K 0.9

Van Wyks Restant AH R 4K R 106K R 813K R -707K 7.7 Kagiso Ext 12 SP2 R 4K R 97K R 115K R -18K 1.2

Wentworth Park R 22K R 593K R 656K R -63K 1.1 Kagiso Ext 14 R 4K R 116K

West Village R 7K R 180K R 353K R -173K 2.0 Kagiso SP R 3K R 83K R 350K R -267K 4.2

Westrand Consolidated Gold Mine R 18K R 464K R 584K R -120K 1.3 Kenmare R 29K R 771K R 868K R -97K 1.1

Zwaneville R 3K R 71K R 113K R -42K 1.6 Krugersdorp Central R 9K R 245K R 223K R 22K 0.9 Avg = R 16K Avg = R 412K Avg = R 619K Avg = 1.5 R 20.0K R 40.0K R 0K R 3,000K R 0K R 3,000K R -1,000K R 0K 0.0 5.0 Krugersdorp North R 24K R 635K R 692K R -57K 1.1 Avg Monthly HH income Target house price Avg Sales Price Affordable Price Gap Affordability Ratio

Krugersdorp West R 12K R 316K R 503K R -187K 1.6 Source: StatsSA Census 2011 (with CPI increase); South African Deeds Registry via Lightstone (Pty) Ltd, 2015. All indicators reflect formal market data as reflected on the deeds registry.

Lewisham R 12K R 309K R 435K R -126K 1.4

Lindley AH R 5K R 129K

Luipaardsvlei Estate R 5K R 130K

The Housing Development Agency | Mogale City Mining Town Housing Market Affordable Suburbs by Affordability Ratio 13.6 Mapping Affordability Mogale City, by suburb, 2013 Relationship between average income and sales price (higher is less affordable) These maps show the importance of taking local household income, or purchasing power, into the understanding of affordability. The first map shows average sales prices by suburb, with the darker areas having higher prices. The second map shows the same area by affordability ratio, the darker areas (those with higher Lindley AH affordability ratios) showing a greater difference between suburb incomes and Magaliesburg SP suburb sales prices. While some areas appear affordable by sales price (such as Oaktree AH Rietfontein AH Kagiso Ext 12), they are not as affordable Marabeth AH when considering local incomes (the darker Ruimsig Noord Eljeesee AH green on the second map). These analyses Rangeview Randfontein Estate Gold Mine do not take into account the indebtedness of potential buyers, an important factor in determining bond eligibility. Rental

Kagiso Ext 12 SP2 housing therefore, might be an important Rietvallei Ext 3 option towards providing well-located and professionally managed affordable housing

Source: Centre for Affordable Housing Finance in Africa, with StatsSA Census 2011 (with CPI increase); South African Deeds in those areas. Registry via Lightstone (Pty) Ltd, 2015. All indicators reflect formal market data as reflected on the deeds registry.

Total Residential properties Affordability Ratio 0 0.3 3.0 The areas with no dots have no residential 1000 properties on the deeds registry – they are farms 2000 3000 or open space, mines or informal settlements. 4025

Affordable Suburbs by Average Sales Price Mogale City, Suburbs by average sales price and household size, 2013

Rietfontein AH

Lindley AH

Mogale City NU

GaMohale

Muldersdrift AH

Rietvei AH

Marabeth AH

Helderblom AH

Breaunanda Westrand Consolidated Gold Mine

Rietvallei Ext 3

Source: Stats SA Census, 2011, South African Deeds Registry via Lightstone (Pty) Ltd, 2015. All indicators reflect formal market data as reflected on the deeds registry.

Total Residential properties Sales Price 0 2000 50,000 500,000 4000 6000 8000 10000

The Housing Development Agency | Mogale City Mining Town Housing Market Report 14. Rental Index

14.1 Key Findings

According to the 2011 StatsSA census, 37% of households rent in Mogale City, which is slightly above the average range of 30% amongst the mining towns in the study.

The opportunity for rental housing development within Mogale City is strong within specific areas. Those areas with greater density, modest incomes, and affordability challenges are more likely to support quality, professionally managed and affordable rental housing. Rental housing also provides flexibility to employers and workers as mining markets expand and contract from time to time.

14.2 Policy Implications

Due to the cyclical, commodity and demand-driven nature of these towns’ primary industry, rental housing becomes a very important housing solution.

Densifying housing markets requires infrastructure upgrades and financial mechanisms which provide for long-term affordability and sustainability.

14.3 Quick Definitions:

Rental Index: A tool used to measure the potential suitability of local areas for rental housing, as measured by a group of five indicators which support rental housing, including density; area median income; the affordability ratio and market growth as measured by the Housing Performance Index. A higher score implies greater success for rental housing.

Area Median Income: the percentage of the average local income to the municipal average income, which allows for understanding the income relative to the market overall, and across many municipalities.

Housing Performance Index: the growth of the local suburb in six key housing market indicators as compared to the municipality growth. A higher number implies more growth.

Percent Households Renting: the number of surveyed households who rent divided by the total number of households, per StatsSA census 2011. This includes everything from bedrooms and backyard shacks to single family homes and sectional title units.

Population Density: the number of people per square hectare of the suburb, as provided by StatsSA.

Tenure: the terms under which land or buildings are held or occupied, e.g. rental, ownership etc.

The Housing Development Agency | Mogale City Mining Town Housing Market Rental Index 14.4 Rental Housing: Driving an Mogale City, by suburb, 2013 Affordable Housing Option Those suburbs with a higher likelihood of rental demand Rental housing is one of the most efficient and effective ways to provide affordable accommodation. In most South African Lindley AH towns, this means backyard shacks, an Mogale City NU important but inefficient way of meeting overwhelming housing need. While a

GaMohale social housing sector exists, targeting lower Oaktree AH income families in multi-unit buildings, these

Sterkfontein are primarily in large metropolitan areas. Agavia Featherbrooke Estate Many private developers and investors are considering expanding significantly Helderblom AH Kenmare into the rental segment. If the demand Kagiso Central

Kagiso Ext 9 is better understood, Government can

Rietvallei Ext 2 meet housing backlogs quickly and Zwaneville affordably by promoting policies which Rietvallei Ext 3 target affordable rental housing.

Source: Centre for Affordable Housing Finance in Africa using South African Deeds Registry via Lightstone (Pty) Ltd, 2015. All indicators reflect formal market data as reflected on the deeds registry. Several conditions are crucial for the Number of Residential properties Type Rental Profile 0 Informal Settlement High creation of successful and sustainable 1 000 Mines Low 2 000 rental markets: density, high demand, and 3 000 4 025 affordability. In order to sustain rental housing at scale, projects must be able to achieve density to keep costs down, and access ready markets, with good proximity Rental Index Method Implies Weight to jobs, transport and educational Indicator opportunities to keep projects running 80 -120% area median Median Income Affordability 35% smoothly. It is possible to bundle those income indicators and find those areas primed for Population Density Exceeds metro average Density 35% rental housing. Housing Growing Demand 15% Performance Index Ratio exceeds metro 14.5 Locating Rental Housing Affordability Ratio Affordability 15% average Markets

The map shows those areas more dense than others, with moderate incomes and housing market growth, all important factors when considering the placement and promotion of rental housing. In Mogale City, several areas (such as Kagiso Ext 8, Magaliesburg SP and Zwaneville) appear as high rental areas.

With security of tenure through a lease agreement, residents have access to quality, accountable property management and consistent utility access, and can even build up their credit history with positive rent and utility accounts. Because rental housing providers must locate their properties competitively to ensure monthly occupancy, rental housing provides affordable access to transport hubs, jobs and community services.

The Housing Development Agency | Mogale City Mining Town Housing Market Report 15. Key Concepts

The definitions of the concepts used in this profile are set out in alphabetical order below.

15.1 Affordable

Traditionally, affordable refers to housing or areas with prices or values below the overall market which target below- average incomes. It is often defined as R500 000 or less (but can be higher or lower depending on intent) because this is the amount that a household earning less than R16 000 on average can afford, which is the target limit of many Government subsidy schemes.Affordability is the relationship between the cost of housing (a mortgage bond payment or rent) and the income of the tenant or owner. Affordable housing is that which can be rented or purchased within certain constraints: in this report, with a mortgage equal to 28% of the borrower’s income, at 11% over 20 years, with 5% of the sales price paid as down-payment. Areas where the average income can afford the average sales price or more, are considered affordable.

15.2 Affordability Ratio

This ratio measures relative affordability by comparing the AVERAGE sales price to the average income within the same area – higher ratios meaning less affordability. The average sales price is divided by the AFFORDABLE sales price, which is calculated as the present value of typical mortgage terms using 28% of the average income (95% of the average sale price, at 11% for 20 years). A ratio of 1 means that the average home price is exactly equal to the average household income. Ratios over 1 represent the number of times by which the average income must be increased to afford the average home.

15.3 Appreciation

The rate, or percent change over time between two values (most often price or value) is calculated by dividing the difference between the beginning and end values of the property in the timeframe by the beginning value. The result is the percent by which the property value or price changed. It is a valuable means of comparing the rate of change across very different property markets, areas or market sizes.

15.4 Average

The result obtained by adding several amounts together and then dividing this total by the number of amounts. For instance, average sales price is calculated by adding up all sales within an area and dividing this total by the total number of sales within an area. The average is useful for comparing and understanding different areas, market sizes, and property types.

15.5 Benchmark

An indicator that is calculated in the same way across a larger level (such as national or municipal levels) to compare with smaller areas (such as main places or suburbs). Benchmarks are useful for understanding the performance of housing markets because they provide a consistent means of comparing markets to each other and to larger areas. For example, local markets perceived as having modest appreciation rates may actually be growing quickly when compared with other areas, the metro or the country as a whole. Benchmarks are a key component of the Housing Performance Index, which uses them to determine whether local areas or metros are changing faster than; about the same as; or slower than the metros or the country.

The Housing Development Agency | Mogale City Mining Town Housing Market 15.6 Bonded Sale

A sales transaction transferring ownership of a property which includes an associated mortgage bond, used by the buyer to purchase that property and which the lender requires to be secured by that property. Bonded sales reflect lender investment in an area and perceptions of market strength and risk levels.

15.7 Churn

This refers to the total number of homes sold within an area over a one-year period divided by the number of homes within that area. Similar to turnover, churn represents active market interest, a large pool of eligible buyers and willing sellers, and ready access to mortgage financing. In affordable areas, lower churn can reflect reduced housing mobility rather than less marketability, as the result of fewer upward housing options for potential sellers, and less access to bond financing for potential buyers. Other indicators (such as bond rates or types; loan to values; equity rates and income) can help differentiate marketability from pent-up market mobility.

15.8 Equity

The value of ownership interest in a property, primarily the current VALUE of a property minus the current value of any bonds or other claims on the property. Equity value grows as mortgage balances are paid down and property values increase. Equity is realised when a house is sold and is most often used to purchase another property, by either increasing the amount available to purchase or lowering monthly mortgage payments (or both). Individual circumstances within neighbourhoods may vary widely, but areas with higher aggregate levels of equity represent greater opportunity for upward mobility, both for existing residents who can sell and invest the equity in a new home and for lower income households able to purchase the existing home.

15.9 Equity Growth

The rate at which an owner or investor’s equity value has changed over time, calculated by dividing the difference between the values of equity at the beginning and end of the period by the beginning year’s equity value. Growth in equity (along with income levels) can be used to determine market potential, as equity significantly boosts the purchasing power of potential buyers. Circumstances that increase equity return include prices that appreciate faster than debt is paid down, less debt, and registrations of new properties with no debt.

15.10 Formal Housing market

A formal housing market is an area where owners sell or otherwise transfer residential properties (which have been registered on the national title and deed registry) to willing buyers who become the legal owners of those properties. Housing markets also include residences that are rented, traded, bartered or otherwise swapped, or legally occupied. This report tracks formal housing markets, as it only uses actual sales reflected on the South African deeds registry. It is estimated that 25 – 50% of all properties in South Africa are not registered.

15.11 Government-sponsored housing

Housing which was created through some government intervention, from site and infrastructure provision, direct construction or finance, such as Site & Service, RDP and BNG. While these homes are not recorded as such on the deeds registry, their presence is estimated based on surrounding registrations, timing, prices, and volume of activity.

15.12 Housing Continuum

The housing continuum includes all ranges and options of housing, from temporary shelter and informal housing to the highest variety of housing ownership and occupancy models and prices. A continuum implies a continuous, connected marketplace of housing options, which serve the full range of conceivable housing demands as people’s lifestyles and life circumstances change over time. In reality, most housing markets are an uneven distribution of housing supply and housing demand.

The Housing Development Agency | Mogale City Mining Town Housing Market Report 15.13 Leverage

Leverage is the practice of purchasing something by borrowing part of the total cost and it is measured by the degree to which a buyer has borrowed funds to purchase a home. Also called gearing, leverage can be measured in several ways (such as loan to value or equity ratio) but all compare bond amounts to the housing value. Generally, homes or neighbourhoods that are highly leveraged are understood to be higher risk because owners lose less equity if they default. Areas with lower leverage rates are generally considered as being more attractive because lenders have less risk, while owners have more invested and have more potential EQUITY to invest in new housing options.

15.14 Market Segment

This refers to the aggregate of all properties within a certain Rand value. Properties are grouped by their value to better understand the unique dynamics of these market segments. Values are divided into four bands: values under R250 000; between R250 000 and R500 000; R500 000 to R1.2 million; and over R1.2 million. Generally, properties at or below R500 000 are considered affordable because the estimated monthly housing cost (R15 000 to R16 000) is considered the maximum income eligible for many Government subsidy programmes, above which potential buyers must access the unsubsidised housing market.

15.15 Market Share

Market share is the percentage of a market accounted for by a specific entity in that market. Lending market share is determined by the number of all loans in an area or bond portfolio originated or held by a single institution, divided by the total number of bonds in the area or portfolio. Market share can reflect the business model or the prevailing attitudes of particular lenders towards opportunity within certain areas. Lenders track their market share by area and value carefully: too high could mean that they are at greater risk if values decrease, while too low means that the lender may be losing business to competitors.

15.16 Rental Index

A score calculated for each suburb, to measure the potential suitability of local areas for rental housing, as measured by a basket of six indicators which are more favourable towards rental housing. A higher score, between 1 and 10, implies a greater likelihood of success. These indicators include density, the number of households currently renting, area median income, the affordability ratio, households to properties ratio and market growth as measured by the housing performance index. The index gives higher weight to aspects more suitable to rental housing, such as density and income, and moderate weight to the current number of households renting (as reported to the census), the local income as a percentage of the municipal median income, affordability (the relationship between local incomes and sales prices) and the number of households in the area to formal housing units on the deeds registry.

15.17 Suburb

A neighbourhood (within or beyond the central metropolitan area), with an identifiable name, often socially accepted borders and common characteristics. This report uses suburb boundaries as established and demarcated by StatsSA (and referred to in its documentation as sub-places). In 2011, there were about 22 000 sub-places within South Africa.

15.18 Value or Worth

The value of a property as determined by several factors, including recent comparable sales nearby, CHURN, lending activity in the area, specific and area property details such as the size, age and amenities. A property’s worth is often related to the amount of information available to make an appropriate determination, which is a contributing factor in undervaluing affordable areas where details on formal market activity are inconsistent. This study uses Lightstone’s (www.lightstone.co.za) proprietary valuation methodology to determine value. 16. Source List

• Africa Mining IQ. [sa]. Coal Mining in South Africa. [O]. Available at http://www.projectsiq.co.za/coal- mining-in-south-africa.htm. Accessed 09 February 2015 • Mogale City Local Municipality. Mogale City Local Municipality 2014/2015 Draft IDP. Mogale City.

The Housing Development Agency | Mogale City Mining Town Housing Market Report

Department of Human Settlement The Housing Development Agency (HDA) 240 Justice Mahomed Street 6 - 10 Riviera Road Govan Mbeki House Riviera Office Park, Block A Sunnyside, Pretoria Killarney 0002 Johannesburg, 2193

Private Bag X645 (Minister) PO Box 3209 Pretoria Houghton, South Africa, 2041 South Africa, 0001 Phone: +27 11 544 1000 Phone: +27 12 421 1311 Fax: +27 11 544 1006/7 Website: www.dhs.gov.za Website: www.thehda.co.za