Expect to sell quickly, stay put longer

Home sellers in the luxury sector of the market should now make sure their sale agreements allow at least six months for them to find and buy their next home.
That’s the advice of Lew Geffen, chairman of Sotheby’s International Realty in SA, who says they may find it difficult to do so because there is now a distinct shortage of stock in many upmarket areas.
“The average sale price in our group has jumped 30% in the past five months – not because home prices have risen but because so many buyers in this period shifted their sights upward to the R3m to R8m bracket, where sales were few and far between during the recession.
“These purchases have mostly been driven by ‘upgrade’ buyers seeking to take advantage of low interest rates and discounted prices ahead of the market upturn, and they have rapidly absorbed most of the stock that was available in this price range.
“Meanwhile, many would-be sellers are now hanging back, no doubt in the hope that prices will rise before they put their homes on the market, and this is exacerbating the current shortage of homes for sale in the high-end areas along the Atlantic Seaboard, in the southern suburbs of Cape Town and in the northern suburbs of Johannesburg .”
The result, he says, is that it can now take much longer for those who do sell to find suitable replacement or upgrade properties, and they need to make sure that this is provided for in any offer to purchase that they accept.“Our suggestion is that they build in an occupational rental period of at least six months from the date of sale now, instead of the more customary three to four months.
“In addition, they should be prepared for their properties to sell much more quickly than has generally been the case since the 2009 recession. Certainly in our group, the average listing time for luxury properties has now dropped from six months a year ago to as little as 40 days, with anxious buyers pouncing on any new stock coming on to the market.”
For this reason, says Geffen, high-end home sellers who do find a replacement home that they like should not hesitate to make an offer, and should also be prepared to be involved in a multiple offer scenario, where they may have to better their original offer in order to secure the property.
“This is happening with increasing frequency in this sector of the market, and buyers should note that having cash readily available to conclude the deal, or genuine pre-approval for a home loan, can often turn the tide in their favour.”

  Comment on this Article

  Please login to post comments

Post to my facebook wall
Characters remaining

    Latest Property News
    • 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.
    • 14 Feb 2018
      While you may not have intended to place your home on the market, what do you do if you receive an unexpected offer on your home? In areas where demand outweighs the current supply of homes available to buyers, it is not unheard of to have buyers make offers on homes that aren’t on the market, says Adrian Goslett, Regional Director and CEO of RE/MAX of Southern Africa.
    Subscribe to the MyProperty Newsletter

    Last Name  
    Email Address  
    Email Frequency
    Share this Page

    For Sale Property
    Rental Property
    More Options
    Connect with us