PROPERTY: The South African Property Market Depressed Not Dead
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International Markets Affect the South African Property Market
If we look at what is happening in the big international markets, the outlook remains much the same according Seeff. “The latest information out of the USA indicates that house prices continue to fall with recovery only expected in 2014,” he adds. The UK housing market too continues to be a tale of falling house prices and low sales volumes with prices only expected to return to the previous peak in 2020 according to a recent PricewaterhouseCoopers (PWC) report.
“In the aftermath of the global recession and South Africa’s hesitant economic recovery, it is understandable that our housing market, not unlike that of the USA, is experiencing a period of price correction, especially in the mid-market and luxury sectors against the pre-2008 price boom levels,” continues Seeff.
“There is movement in the market, but this is lateral only as recovery continues to be affected by rising costs,” he adds. “Credit remains a significant stumbling block. There has been an increase in first time buyers as at the second quarter of this year, but according to FNB, still not enough to absorb the over-supply of stock.”
Positive Growth for the South African Property Market
Of significance though according to Seeff is that its principals in the Johannesburg and Pretoria areas have reported an uptick in sales. The Northern region showed a positive sales growth of 10.4 percent for the month of June 2011 versus last year and for the period January to June 2011, a sales growth of just over 9 percent. “This is the powerhouse of activity in country,” adds Seeff and, “we know from experience that once activity picks up in the north, it will ripple through to other major areas.”
“It is still a buyer’s market right now,” continues Seeff. “While the winter months are historically a time of lower trading volumes, this is a good time for smart buyers, especially first-buyers and those looking to buy-up or acquire investment properties to get their hands on excellently priced stock in the market.” Seeff’s advice to sellers, “if you need to sell your property, you will need to price it accordingly, if not, he adds “hold on to your property until the tide turns.” This advice continues to repeat itself as stability slowly becomes an owners goal in the South African property market.
Business News Sector Tags: Property|