We continue to experience a general reluctance from individuals to commit to buying property in the area. This is no different from the general sentiment across the country and it seems that most of us are missing out on an excellent opportunity. Buying a property is a big investment and there is no doubt that you need to consider your decisions thoroughly. But it would seem that many buyers are worried about uncertainty in the country and as a result are taking no decisions at all.
I often hear friends and clients talking about how they are no longer investing in the country and are taking all their money offshore. I do wonder whether they have considered these investments carefully based on the countries, instruments and industries they are exposed to. The bottom line is that some people are choosing to rent where they are living for long periods of time or staying in properties that no longer cater for their needs. On any level this doesn’t make much sense especially for buyers that can afford to live in the Parks and surrounds. The banks are eager to lend and interest rates are low. Likewise, some sellers are hoping to hold on for unrealistic prices and when their properties don’t sell, they are choosing to rent out their properties which may not ultimately suit them. The property may not get the attention and maintenance it needs in the interim and most likely won’t show as well when they eventually do decide to sell. They may also be losing out on good acquisition opportunities elsewhere.
There is political uncertainty in South Africa and there has been a lot of talk about expropriation of land without compensation. While the detail around the ANC’s plan is not clear, they have stated that it will be done in a manner that does not negatively impact the economy or food production. I don’t believe that the government is simply going to take your home away as doing so would collapse the banking system and have a devastating impact on the economy.
In January we were high on ‘Ramaphoria’ but we have become negative again. We are hoping for the economy to turn around overnight and I think we need to be patient. It also won’t help you as a property investor to wait for the tide to turn before committing to a new property purchase. As we gear up towards the general elections, we will hear more statements that scare or worry us but I am sure the populist rhetoric will die down as soon as the elections are over. I am not sure about you but I am in South Africa to stay. I am feeling optimistic about a number of developments that are happening in our country at the moment and even more optimistic about the future of the property market. At Harcourts South Africa we have achieved 8% year on year growth over the 2017/18 period. We have recently launched our buyers guide for the Parkhurst area and this provides some interesting information about one of the suburbs and communities which we just love working in.
Marc Rodrigues | Principal | Harcourts Heritage