select
|

Distressed sales buoy PE market

So says Charlotte Vermaak, sales manager of the Chas Everitt International office in the city, who estimates that 30 to 40 percent of the sales taking place currently are of distressed properties – some of which are those being sold under the various bank assistance programmes that help owners keep their credit records intact.

“The most popular are family homes in the R700 000 to R900 000 bracket, which are being bought by medium-income buyers seeking good value for money and keen to access the favourable financing arrangements that the banks offer on such properties,” she says.

“At the same time, many sellers of these properties are deciding not to go into the rental market, but to simply downscale to smaller, more affordable homes, and this is boosting demand in the R400 000 to R700 000 bracket. There is a shortage of rental property in Port Elizabeth and in many cases it is easier and makes more sense to buy again, especially with interest rates at their current levels.”

Meanwhile, Vermaak says, there is also more activity now in the R900 000 to R1,2m bracket as increasing numbers of existing homeowners also take advantage of the low interest rates to upgrade to bigger and better homes or more central areas with better access to their workplaces and the schools they favour.

“Suburbs such as Lorraine, Parson’s Vlei, Westering, Kabega Park and Richmond Hill, particularly, are experiencing good sales volumes at the moment because of these trends, with Lorraine, for example offering a whole range of properties for those moving up or down the affordability scale.”

In fact, she says, the Port Elizabeth market overall is gaining strength, even though production in the city’s main industries and business sectors have not yet returned to pre-recession levels.

“However, it is important to note that because there is still a substantial oversupply of properties for sale, we are not expecting prices to show any significant upward movement for some time yet.

“And the same goes for rentals, even though there is a shortage of stock and high demand. We have 20 to 25 applicants for each rental unit that becomes available now, compared to 10 applicants two years ago but landlords, it seems, would rather keep existing tenants now than raise rentals and risk losing them.

“Rentals at the moment range from R3500 to R5500 a month for a two-bedroom flat or townhouse, and from R8000 to R10 000 a month for a three-bedroom house, and that is pretty much at the limit of what local employees can afford.”


  Comment on this Article

  Please login to post comments

Post to my facebook wall
  
2000
Characters remaining


    Latest Property News
    • 19 Feb 2018
      Possibly one of the biggest sources of contention between landlords and tenants surrounds the rental deposit. “Most tenants rely on getting their rental deposits back when moving, so that they can use it to pay a deposit on their new home. Having it withheld or even having large amounts deducted can lead to a lot of distress,” explains Bruce Swain, CEO of Leapfrog Property Group.
    • 19 Feb 2018
      Situated approximately halfway between Johannesburg and Pretoria, Midrand was established in 1981 and forms part of the City of Johannesburg Metropolitan Municipality. It has become one of the major business hubs in the country with major pharmaceutical, textile, telecommunication and motoring giants situated within its boundaries.
    • 19 Feb 2018
      The PayProp Rental Index Annual Review of 2017 shows that the rental market suffered from much volatility during the year. It kicked off with rental growth spiking in January with weighted year-on-year growth (YoY) growth peaking at 8.3% before dropping to 6.34% in July, dipping down to less than 5% in November and then experiencing a slight uptick at 5.75% in December.
    • 19 Feb 2018
      While most homes in cluster complexes, estates and other gated communities come with at least one garage or carport, residents would often like additional permanent parking or storage areas for things like trailers, bikes, boats and caravans.
    • 16 Feb 2018
      Whether you own a property in a sectional title complex or are looking to invest in one, the financial standing of the body corporate is the single most important thing that can affect your investment or your buying decision.
    • 15 Feb 2018
      One positive consequence of the financial crash in 2008 was the rise in consumerism, especially in the property market, where buyers have steadily become more knowledgeable and more value conscious.
    • 15 Feb 2018
      While most homeowners will take the agent’s commission into consideration when they are trying to determine what the will get out from the sale of their property, many often forget to factor in the other costs involved in a home sale, says Adrian Goslett, Regional Director and CEO of RE/MAX of Southern Africa.
    • 14 Feb 2018
      The forecast for the national rental market in 2018 remains a mixed bag of good news and bad news. Although rentals are expected to rise slowly as the challenges of home affordability and tighter lending criteria tighten their grip, it’s a double-edged sword as the market also will come under increasing pressure from factors like declining disposable income levels.
        
    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