select
|

It’s a property buyer’s market for 2018, says Seeff

The property market has shifted notably over the last 18 months as the fall-out from the weak political and economic climate, poor growth and credit downgrades continue. The inevitable result, says Samuel Seeff, chairman of the Seeff Property Group, is that this rather good performing economic sector, is now also taking strain.
 
Where it was a sellers’ market until early last year, we have seen a progressive shift this year which has manifested in lower demand, rising stock levels combined with a decline in buyer confidence, flat price growth and deals taking longer to conclude. The outcome, is that we head into 2018 with a buyer’s market for most areas, even some Cape locations.
 
Of concern, he adds, is that there is still a lag on the sellers’ side of the equation with price expectations out of step with the market. The result, he says, is an overall weaker market with low levels of liquidity that now favours buyers in most areas.
 
Overall, the market is down by about 15%-20% from the 2015-highs. Yet, says Seeff, we operated in 2017 with slightly improved fundamentals compared to 2016, being a lower repo rate (6.75% vs 7% in 2016) and slower inflation (5.3% vs 6.5% in 2016).
 
Even the stand-out Cape is beginning to slow down although it continues to benefit from a broad base of demand such as the constant flow of semigrating buyers from other areas, investment and holiday demand.
 
Seeff notes that the reported slow-down in semigration is also attributable to the slow rate of sales in other provinces combined with the high prices in the Cape which has now put a dampener on this market.
 
The mid-market below R2 million remains the most active, but very susceptible to financial strain. The upper end, despite being able to better absorb economic fluctuations, says Seeff, has seen a notable slow-down in the Gauteng market above R5 million and in the Cape above R8m and above R18m on the Atlantic Seaboard. The holiday and investment market has also slowed as an inevitable fall-out from the weak confidence levels.
 
Seeff notes further that the Finance Minister painted a subdued outlook in his mini budget and we are in for a tough economy and property market in 2018. While by no means gloom and doom, it is a period of prudence ahead for property.
 
While looking forward to a busier summer period, especially the first part of the year when there is always higher activity, the biggest challenge for the economy and market remains the unstable political climate and poor economic decisions making, he says.
 
That said, history has shown SA property to be a good investment with growth rates that generally outpace inflation during a positive economic phase as we have seen over the last few years. Property remains a good investment, especially if it is your primary home. Seeff reiterates that there is nothing more important than owning the roof over your head as it provides stability and a base upon which to build a life and wealth.
 
Regardless of the state of the economy, Seeff says there will always be people who need to buy or sell for a variety of reasons and there is opportunity in every market. Every economy and property market goes through cycles and it is always best to take a long-term view, he concludes.


  Comment on this Article

  Please login to post comments

Post to my facebook wall
  
2000
Characters remaining


    Latest Property News
    • 15 Dec 2017
      With much still riding on the outcome of the ANC elective conference later this month (16-20 December 2017) which, coupled with the Budget Speech in February next year (2018), will impact on business and consumer confidence and market sentiment in general, it is expected that South Africa’s residential property market will continue to maintain its resilience, reflecting an ongoing healthy appetite for property investment – particularly in major metros and key hubs.
    • 15 Dec 2017
      The City of Cape Town has approved a drought levy and increased water restrictions to level 6.
    • 15 Dec 2017
      Negativity seems to have become the fashion in SA’s real estate industry over the past few months, but while there will be challenges, the property market is not going to “fall off a cliff” in 2018, says Berry Everitt, CEO of the Chas Everitt International property group.
    • 06 Dec 2017
      Homes situated within residential estates have become a more and more popular option across South Africa. There are, however, some emergency situations when heavily guarded access points to these communities can be more of a hindrance than a help.
    • 06 Dec 2017
      The average year-on-year house price growth for this year was likely to be slower than last year, despite year-on-year house price growth accelerating mildly in recent months.
    • 05 Dec 2017
      Located in dynamic and scenic Kenilworth is The Wentworth, a new development exclusively marketed by Greeff Properties.
    • 05 Dec 2017
      Today's rental market is a competitive place, so when you find the perfect spot it can be tempting to just sign on the dotted line and hope for the best. Sadly, there are more and more scammers who are taking advantage of this opportunity to dupe unsuspecting applicants out of their hard-earned cash.
    • 05 Dec 2017
      Gated communities are increasingly popular with home buyers due to the perceived safety these neighbourhoods offer. “These gated communities are popping up all over the country and while they certainly can boost security, a few issues have been cropping up – specifically referring to road usage,” says Bruce Swain, CEO of Leapfrog Property Group.
        
    X
    Subscribe to the MyProperty Newsletter

    Name  
    Last Name  
    Email Address  
    Email Frequency
    select
    X
    Share this Page

       
    For Sale Property
    Rental Property
    More Options
    About
    Connect with us
    FEEDBACK