Today’s (9 September 2010) announcement by the Monetary Policy Committee that the interest rate would be reduced is most welcome and needed, says Dr Andrew Golding, CE of the Pam Golding Property group.

“This is good news for existing home owners and for prospective home buyers. Although the residential property market has shown some increased activity in terms of sales volumes (ie units sold), the ongoing constrained economic conditions and limited access to bond finance, coupled with the significantly increased electricity and rates tariffs, is still hampering significant recovery in the housing sector.

“With the arrival of spring, there is usually a natural seasonal increase in activity in the property market and there is every expectation that this season will be no different, particularly given the fact that the market experienced an “unnatural” slowdown during the six weeks of the Soccer World Cup and appears to be catching up.” 
Dr Golding says Pam Golding Properties has seen some signs of recovery, albeit to at least the market activity levels that were present in the run-up to the World Cup.  “These activity levels are in themselves 30 percent up on last year (2009).  A number of factors are responsible for this recovery and include  improving market sentiment - ie a sense that the market might have reached the bottom; improving  bank lending; greater realism amongst sellers regarding the current market value of their properties; and an increase in the number of buyers looking to transact.

“Show house attendances are generally on the increase - in line with expected trends for this time of the year.  We have also seen the slow but steady re-emergence of buy-to-let investors in all the major metropolitan areas of the country. International enquiries, while generally slower than in previous years, have also begun to increase. In respect of the development market, there are growing indicators that the larger developers are poised to begin re-entering the market. 
“As far as house values are concerned, our view is that for the remainder of this calendar year, prices will remain relatively steady with house price growth expected to be somewhere between zero and five percent.

“From the perspective of price sectors most in demand, there is very little change to the status quo which has been evident for some time, namely with the market from R800 000 to R1.5 million being the most active. However,  with properly qualified buyers and realistic sellers, properties are moving in all price segments from the affordable housing segment right through to the ‘über prime’ market,” concludes Dr Golding.

Issued by Gaye de Villiers

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