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Ed Grondel. CEO of FNB Home Loans has been interviewed on a number of radio shows following the release of the latest Property Barometer report. The report measures the sentiment of top real estates to determine the level of confidence in the market.
Here are some of the key points highlighted by the report:
- Property prices have slowed but the market is still growing at a more sustainable rate.
- There exists an unusual boom in the lower end of the market, particularly in the Townships.
- Current economic conditions point to a good year ahead for residential property.
- Two Interest Rates Cuts are expected.
Grondel believes that property is still a good investment and although homeowners should not expect big capital gains in a year or less (a quick buck), their property values will continue to increase steadily over a few years.
FNB extended their research in the townships and the results show that more than 90% of sellers in townships are getting their asking price, compared to 53% in the metropolitan areas.
In terms for interest rates, Grondel admits he’s little more optimistic about the future than most. FNB economists are expecting interest rates to be cut twice later this year and enter the single digit range.
Low interest rates should make home loan more affordable, which should further encourage consumers to enter the property market.