Gauteng Business News

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PROPERTY: Mindset Change Needed in SA Luxury Homes Market


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“An expansive, positive mindset is what is needed in the SA luxury residential property market right now – instead of the negative, laager mentality that seems to have crept in behind the global debt crisis,” says Ronald Ennik, CEO of Johannesburg-based Ennik Estates.

The company is the exclusive affiliate in Gauteng of Christie’s International Real Estate – the global luxury property arm of the world’s largest and oldest fine art auction house.

Understanding the State of Mind Towards the SA Luxury Homes Market

“Sentiment – not price, interest rates, or mortgage finance issues – is the biggest driver of the luxury homes sector,’ says Ennik.

“And, as long as attention remains focused on the economic problems of western countries in the Northern Hemisphere, and the fear of collateral damage here in SA, a laager mentality will continue to hold back the market,” he adds.

“But it is closer to home, right here in Africa, that some of the most promising sentiment-building indicators for our property market are appearing.

“A global poll of institutional investors, conducted by Invest AD and The Economist Intelligence Unit, has shown that Africa’s frontier markets offer the best overall prospects for investment growth over the next decade.”

A Possible Boost for SA Luxury Homes Market

Furthermore, the latest African Markets Revealed report by Standard Bank has indicated that African economies are set to remain resilient, while the International Monetary FundÂ’s growth forecast for Africa is 5,2%, says Ennik.

That is why South Africa’s incisive message to the recent World Economic Forum in Switzerland was ‘Africa is the next great investment frontier, and South Africa is its gateway’, says Ennik..

“Meanwhile, we are seeing an uptick in foreign interest in the Johannesburg market. It is being generated predominantly by executives who are continually mobile between London and European capitals, South Africa, and other countries in sub-Saharan Africa.

“The fact is that the wealthy, internationally, are spending again on luxury property and fine art. With a positive mindset, South Africa could be part of that process and this could really boost the SA luxury homes market,” Ennik concludes.


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