The South African property market has slowed considerably since House price growth peaked at 35% year on year in 2005. But the future of the local property market looks bright.
Homeowners can definitely look forward to sustainable growth in property prices.
Interest rates have always affected the state of property market. Periods of low interest rates have boosted property sales while periods of high or raising rates usually have an adverse effect.
The Feb 2007 the South African Reserve Bank decided to leave lending rates unchanged after four consecutive 0.5% increases.
Another reason why property economists are predicting a bright future is that a large amount of money has been set side for housing development which should have a knock on effect for property in other areas of the country.
And finally the introduction of the New Credit Act may initially make it tougher to secure Home Loan finance but over time will help to reduce the high levels of household debt. In a nutshell, the credit act will protect consumers from irresponsible lenders, with an emphasis on educating the consumer before lending them money.