Reactions regarding the repo rate

“However, maintaining the rate at current levels should be seen in the context of the opposing forces of rising inflation in South Africa (normally a precursor to increasing rates) and calls among some market commentators for the interest rate to be further reduced due to the lacklustre performance of the local economy. We expect that interest rates will remain at relatively low levels for the foreseeable future, providing some measure of certainty to the cost of debt.”

He says despite the fact that the South African housing market remains muted, it continues to demonstrate resilience. This sector remains tight, impacted mainly by strict bank lending criteria and buyer affordability, with agents’ ability to successfully converge selling prices with buyer expectations proving a key factor in current trading conditions.

“From a Pam Golding Property group perspective we are finding market sentiment more positive than it has been during the recent recession, with a significant improvement in show day attendance and buyer enquiries. For the month of August 2011 the group’s unit sales have seen a marked increase of 28 percent over August 2010, while sales turnover for the same period has also increased by 21 percent over August last year.

“As house prices on average have remained relatively flat, the increase in sales turnover is attributable to the increase in units sold. This in turn is a direct result of several factors, including PGP’s increase in market share – with a marked increase in market penetration evident in most major cities and metropoles.

“We find the group’s significant investment in agent training as well as selective recruitment is paying dividends. An agent’s ability to assist sellers in matching their price expectations to current market conditions is a critical factor in concluding sales. Increasingly we perceive that both sellers and buyers are seeking reliable market information from credible organisations with extensive reach and experience through challenging economic times as well as during buoyant market conditions.“

Dr Golding says well informed investors continue to capitalise on the opportunities presented by the prevailing economic scenario in order to make sound property acquisitions. “A good example of this is at St Francis Links, where astute buyers are purchasing plots at prices approximately 50 percent less than in the property boom years. PGP’s St Francis office has concluded five such sales in recent weeks and has a number of further sales currently in progress, ” he adds.

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