Property market and company news
Category Newsletter: Company Message
Following the technical recession that South Africa entered into in the first quarter of 2017 and the revised expected GDP growth for 2017 down from 1% to 0.5%, the South African Reserve Bank surprised markets with an interest rate cut on Thursday. This will bring some needed relief to many South Africans in debt as they will now have a little extra cash to spend each month. The prime lending rate has resultantly dropped from 10.5% to 10.25%.
The slow economic performance is placing many consumers under increased pressure and may have put their home ownership aspirations on the backburner for the time being. We have noticed a slowdown in the sales market with properties remaining unsold for longer, our stock levels have risen slightly and price growth is slower. To the contrary, demand in the rental market has continued to remain strong, with the Atlantic Seaboard experiencing a shortage in affordable rental opportunities.
At this stage it is unclear as to whether the rate cut will stimulate the property market. Much scepticism has resulted from government’s policy decisions, not to mention the recent credit downgrades that have negatively impacted consumer confidence. Sellers now need to ensure that their properties are in great shape, are priced correctly according to the current market conditions and preferably sign a sole mandate with an area specialist so that more resources are dedicated to the sale of the property at the best price.
On a seperate note, we are very excited about the upcoming launch of our new Sea Point office. This office will service our growing clientele of Sectional Title owners and will be the home of our Sales and Letting teams that specialise in the Atlantic Seaboard and surrounds. Should you need any assistance, please do not hesitate to contact one of our Property Consultants who are readily available to assist you.
We wish you all the best for the 3rd quarter of 2017 and thank you for your support. Our staff look forward to continuing their services to all clients over this next quarter. For those that are escaping the winter cold for the warmer European weather, travel safe!
Author: Paul French, Commercial Director
