Commercial mortgage-backed securitisation (CMBS) is an important development in the South African property finance field. This study explains the characteristics; structure and structuring; advantages, disadvantages and risks; and legal and regulatory aspects of CMBS. Four CMBS programmes have been launched in South Africa to date (August 2006) all of which have been originated by listed Property Loan Stock (PLS) companies. The unique features of the four programmes were examined and the impact on their originators and the listed property sector was analysed. The main participants in the South African CMBS industry were interviewed. CMBS has acted as a catalyst for greater competition between banks resulting in lower interest rates on bank debt and the creation of new property financing products. The introduction of CMBS has benefited not only the four originating PLS companies, but also had a positive impact on the entire listed property sector. / Business Management / M. Com. (Business Management)

Submitted in fulfilment of the requirements of the Masters of Technology degree in Cost and Management Accounting, Durban University of Technology, Durban, South Africa, 2015. / The National Credit Act No. 34 of 2005 (NCA) was introduced by the South African government mainly to bring about accessibility to credit markets, protect consumers from malpractices and market abuses by credit providers and reduce consumer over indebtedness. As a result, credit providers are compelled to apply stringent rules and regulations when assessing a credit consumer’s affordability prior to granting home loans. This study aims at investigating the impact of the NCA on the affordability of home loans within the Pinetown metropolitan area. The literature review presents an overall view of affordability of home loans in developed and emerging countries and also provides an in-depth explanation of factors that affect affordability of home loans in South Africa. The predominant factors, amongst others that hinder the housing market, are: an increase in house prices; elevated interest rates and household debt which include inflation, transportation cost and low wage increase. A mixed methods approach was utilized for the research, analyzing both quantitative and qualitative data. Respondents (home loan borrowers) completed a questionnaire by indicating if assessments were conducted in terms of their affordability prior to the approval of their home loan and their view on the impact that the NCA had on their home loan. The data suggested strongly that credit providers had conducted proper credit and affordability assessments prior to granting home loans and that most home loan borrowers’ level of debt had remained stable since acquiring their home loans as they continue to meet their debts. An overall analysis revealed that the application of the NCA had a positive impact on the affordability of home loans in the research area and that compliance with NCA, when granting credit, resulted in the reduction of reckless lending, a decline in the level of consumer indebtedness and a reduction in payment default.

Thesis (MBA (Business Management))--Stellenbosch University, 2008. / ENGLISH ABSTRACT: This study is entitled: "An investigation into the industry attractiveness of the residential mortgage origination industry for entrepreneurs in the Western Cape region of South Africa". The South African mortgage origination industry dates back to 1998 when Mortgage.com approached the banks to originate home loans via the Internet. The USA had seen a rise in the deployment of these websites and predictions where that the platform would outstrip physical channels. This was not to be, but this led to the establishment of Mortgage SA. The mortgage origination industry experienced rapid growth since its inception and was considered to be highly attractive in terms of revenues and opportunity. However, because of the oligopolistic structure of the industry, non-competitiveness of smaller originators ascribed to lower commission rates offered to them by financial institutions and optimal profit levels being reached, it appears that the mortgage origination industry is becoming less attractive than it used to be. The primary objective of the study was to draw conclusions on the fundamental industry attractiveness of the mortgage origination industry for entrepreneurs in the Western Cape region of South Africa. Secondary objectives included; determining whether the mortgage origination industry is still a viable or profitable industry for entrepreneurs to explore, examining the current state of the mortgage origination industry, investigating the key issues and problems facing the mortgage origination industry and establish the entry and exit barriers as well as the feasibility of the industry for new entrants. This study was a culmination of literature from various sources, researching theories, views and perceptions regarding mortgage origination in South Africa. Various websites, newspaper articles, journals and books were used as part of the research process to deepen the researcher's understanding of the mortgage origination industry, its roles and functions. Secondary research was conducted in the form of a literature review which provided a better understanding of the mortgage origination industry, provided an introduction to industry attractiveness and provided a basis for the primary research. Primary research was conducted by means of personal one-to-one interviews with key decision makers from a predominantly external (client) as well as an internal (mortgage originator) perspective. To avoid bias and ensure an overall perspective of the industry, it was important that the sample be reflective of role players involved in the mortgage origination process, including home buyers (investors), estate agents, mortgage originators, lawyers and lenders (banks). The methodology employed for the purpose of the study was qualitative. The interviews were conducted by means of using a discussion guide and were based on the respondent's personal experience with the industry as a whole. To answer the research question as set out in the research problem as well as fulfil the objectives of this study, it was essential that the selected sample be representative of stakeholders in the mortgage origination industry, and a purposive or judgemental sample was selected using non-probability sampling. Overall, the mortgage industry is not as attractive as it used to be, yet it cannot be deemed to be completely unattractive either. On an average the industry is attractive. The research hypothesis can, therefore, neither be accepted nor rejected with confidence. Considering the current economic climate and market conditions, one would be tempted to reject the research hypothesis, but a positive economic turn would cause the industry to become attractive again. Finally, it is recommended a more detailed analysis of the industry be conducted. The methodology employed for the purpose of this study was qualitative, as exhaustive quantitative research was not required. Furthermore, it is recommended that a quantitative approach be utilised to verify the results of the study. Furthermore, it is also recommended that the mortgage origination industry be analysed in terms of its fundamental attractiveness every one to three years, as strategies need to be re-examined as events unfold. An accurate diagnosis of the industry is necessary for deciding on a sound long-term direction, setting appropriate objectives and crafting winning strategies. / AFRIKAANSE OPSOMMING: Hierdie studie se titel is: "'n Ondersoek na die industrie-aantreklikheid van die residensiele verbandopnemingsindustrie vir ondernemers in die Wes-Kaapse streek van Suid-Afrika". Die Suid-Afrikaanse verbandopnemingsindustrie dateer terug na 1998 toe Mortgage.com die banke genader het om huislenings op te neem via die Internet. Die VSA het 'n toename in die aanwending van sulke webtuistes ervaar en daar is voorspel dat hierdie platform fisiese kanale sou verbysteek. Dit het nie gebeur nie, maar dit het tot die stigting van Mortgage SA gelei. Die verbandopnemingsindustrie het vinnige groei sedert sy stigting beleef en is gesien as hoogs aantreklik ingevolge inkomste en geleentheid. As gevolg egter van die oligopolistiese struktuur van die industrie, die gebrek aan mededingendheid van kleiner opnemers wat toegeskryf is aan laer kommissiekoerse wat finansiele instellings aan hulle aangebied het en optimale winsvlakke wat behaal is, kom dit voor asof die verbandopnemingsindustrie minder aantreklik raak as wat dit vantevore was. Die primere oogmerk van die studie is om tot gevolgtrekkings te kom oor die fundamentele industrie-aantreklikheid van die verbandopnemingsindustrie vir ondernemers in die Wes-Kaapse streek van Suid-Afrika. Sekondere oogmerke sluit in om vas te stel of die verbandopnemingsindustrie steeds 'n lewensvatbare of winsgewende industrie is vir ondernemers om te ontgin, om die huidige status van die verbandopnemingsindustrie na te gaan, om die sleutelkwessies en probleme wat die verbandopnemingsindustrie raak, na te vors en om vas te stel wat die binnekoms- en verlatingsversperrings is, asook hoe uitvoerbaar dit vir nuwe toetreders is om tot die industrie toe te tree. Hierdie studie was 'n samevoegingspunt van literatuur vanuit verskeie bronne, navorsingsteoriee, menings en persepsies aangaande verbandopneming in Suid Afrika. Verskeie webtuistes, koerantartikels en boeke is geraadpleeg as deel van die navorsingsproses om die navorser se begrip van die verbandopnemingsindustrie, sy rol en funksies te verdiep. Sekondere navorsing is onderneem by wyse van 'n literatuuroorsig wat 'n beter begrip geskep het van die verbandopnemingsindustrie, 'n inleiding tot industrie-aantreklikheid verskaf het en ook 'n basis vir die primere navorsing daargestel het. Die primere navorsing is onderneem by wyse van een-tot-een onderhoude met sleutelbesluitnemers vanuit 'n oorwegend eksterne (klient) asook 'n interne (verbandopnemer) perspektief. Om bevooroordeeldheid te vermy en 'n oorhoofse perspektief van die industrie te verseker, was dit belangrik dat die steekproef verteenwoordigend van die betrokke rolspelers in die verbandopnemingsindustrie sou wees, insluitende huiskopers (beleggers), eiendomsagente, verbandopnemers, prokureurs en leners (banke). Die metodologie wat vir die doel van die studie aangewend is, was kwalitatief. Die onderhoude is gevoer deur middel van die gebruik van 'n besprekingsgids en is gebaseer op die respondent se persoonlike ervaring van die industrie as 'n geheel. Ten einde die navorsingsvraag te beantwoord, asook om te voldoen aan die oogmerke van die studie, was dit noodsaaklik dat die geselekteerde steekproef verteenwoordigend moes wees van die belanghebbendes in die verbandopnemersindustrie. 'n Doelgerigte of beoordelende steekproef is gekies met gebruikmaking van 'n nie-waarskynlikheidsteekproef. Oorhoofs is die verbandindustrie nie meer so aantreklik soos vroeer nie, maar dit kan egter ook nie as totaal onaantreklik gereken word nie. Die industrie is gemiddeld aantreklik. Die navorsingshipotese kan dus met vertroue nog aanvaar nog verwerp word. Met inagneming van die huidige ekonomiese klimaat en markomstandighede, sou mens geneig wees om die navorsingshipotese te verwerp, maar 'n positiewe ekonomiese opbloei sou weer daartoe lei dat die industrie aantreklik word. Dit word laastens aanbeveel dat 'n meer gedetailleerde analise van die industrie onderneem word. Die metodologie wat vir die doel van die studie gebruik is, was kwalitatief, aangesien uitvoerige kwantitatiewe navorsing nie nodig was nie. Dit word verder aanbeveel dat 'n kwantitatiewe ondersoek onderneem word om die resultate van die studie te verifieer. Dit word ook aanbeveel dat die verbandopnemingsindustrie elke een tot drie jaar geanaliseer word ingevolge sy fundamentele aantreklikheid, aangesien strategiee telkens beproef behoort te word namate gebeure ontvou. 'n Akkurate diagnose van die nywerheid is noodsaaklik om op 'n gesonde langtermynkoers te besluit, om op gepaste doelwitte te besluit en om wennerstrategiee te formuleer.

published_or_final_version / Real Estate and Construction / Doctoral / Doctor of Philosophy

published_or_final_version / Real Estate and Construction / Master / Master of Science in Real Estate and Construction

published_or_final_version / Business Administration / Master / Master of Business Administration

published_or_final_version / Real Estate and Construction / Doctoral / Doctor of Philosophy

This dissertation explores the impact of tax policy and institutions on decisions in the market for housing. The first essay is joint work with Andrew Hanson. In it, we estimate the sensitivity of mortgage interest deducted on federal tax returns to the availability of the Mortgage Interest Deduction (MID). Our primary results show that for every one percentage point increase in the tax rate that applies to deductibility, the amount of mortgage interest deducted increases by $303–590. The second essay simulates changes to average home prices in twenty-seven cities that would result were the MID reformed. I use local variation in housing parameters to simulate home price changes for three different reforms: eliminating the MID, converting the MID to a fifteen percent credit, and capping the MID at fifteen percent. City price changes vary in response to a single policy by as much as 12.8 percentage points. Spatial variation within cities is also notable, with areas high in income experiencing steeper price declines and areas of lower income experiencing shallow declines. The third essay is joint work with Andrew Hanson, Zack Hawley, and Bo Liu. We design and implement an experimental test for differential response by Mortgage Loan Originators (MLOs) to requests for information about loans. Our e-mail correspondence experiment is designed to analyze differential treatment by client race and credit score. Our results show net discrimination of 1.8 percent by MLOs through non-response.

The goal of the diploma thesis is to describe stochastic processes in the combination of mortgage loan and fund-linked life insurance, and to construct and analyze suitable mathematical models related to them. The idea of the combination of mortgage loan and fund-linked life insurance consists in serving the debt via paying up the interest only and investing the rest of the instalment within a fund-linked life insurance, instead of amortizing the debt gradually. At the maturity time, the principal sum will be amortized at once, using assets which have been invested within a fund-linked life insurance.

In this thesis, we aim to find the effect of economic crisis announcements arising from the US subprime mortgage crisis and European sovereign debt crisis on the market volatility in theBRIC countries. We implement a GARCH model in order to compare the effect of individual news announcements and find that the US crisis had a bigger impact on BRIC market volatility than the European crisis. Of particular note, we find the US bailout had a higher impact than the failure of Lehman Brothers or any European crisis dates that were considered. We then examine the volatility transmission mechanism by implementing a VAR model to create a spillover index. Following, we apply a rolling window approach, creating spillover plots which show that both return and volatility spillovers are affected by crisis announcements. The importance of our results are related to investor decision making, particularly the relationship between market return and risk in developing country markets. Far to our knowledge, no recent literature has compared the two crises in the way we have nor with the datasets we have used.