It seems that industry experts all agree that the South African property market is headed for recovery. And, most commentators are predicting a steady, but slow improvement in property values over the coming 12 months.
Lew Geffen, chairman of Sotheby’s International Realty was quoted recently in the media saying: “Big ticket sales, especially, are back with a bang, and stock is being taken up fast, even in the most expensive suburbs of Johannesburg and along Cape Town’s Atlantic Seaboard”.
Geffen, whose company recorded a 60% improvement in turnover, predicts that property values will increase by 9% this year. Which he believes is a healthier growth rate than the 20% or 30% increases experienced during the boom times.
Seeff believes that 2010 Soccer World Cup will have a positive effect on sentiment rather than actual sales. The strong positive sentiment among South Africans will actually draw more local buyers into the market, helping to provide a balance between supply and demand.
But, he points out that South Africa will be showcased to the world for the duration of the tournament and this will certainly open up the country to potential investors and buyers.
Levit notes that “in 2010 people will start spending more”, but added that although the Fifa World Cup will likely cause a bounce in high value residential properties, it unfortunately would not be a magic pill to quickly relieve the downturn.
The benefit of the interest rate cuts has finally begun to filter down the market to buyers who are finding that homeownership has become a lot more affordable.
The key sustaining this recovery is to ensure that sellers and agents don’t get caught up in the euphoria around the World Cup and create a situation where sellers start asking unrealistic prices thinking that soccer fans are heading to South Africa on property shopping trips… this will kill sales.