select
|

Why are property sales taking longer?

By the end of the fourth quarter the time a residential property remained on the market before being sold lengthened, and 88 percent of sellers had to reduce their asking price to finalise a sale despite estate agents reporting an improvement in activity levels. 

According to the latest FNB's estate agent survey, activity levels rose during the period to 6.7 on a 10-point scale from 5.91 in the previous quarter.

John Loos, a household and consumer sector strategist at FNB, said this suggested that a gradual strengthening in the market through 2012 and last year was still intact and the mild seasonally adjusted decline in the third quarter did not signal a trend change.

The estimated average time a property remained on the market rose to 15 weeks and one day in the fourth quarter from 14 weeks and five days in the third quarter.

Loos said this indicator gauged the pricing realism of sellers but stressed that fluctuations from quarter to quarter could be volatile. The smoothed trend line was more significant and continued to point to a broadly declining trend in the average time on the market since a high of 19 weeks and one day at the beginning of 2011.

However, he said 15 weeks remained lengthy compared with levels achieved in 2004/5 and the market largely seemed 'rational and calm' rather than booming.

Loos said the average reduction in asking prices was unchanged at 9 percent in the fourth quarter from the third but lower than the estimated 13 percent at one stage in 2011.

Most agents expected house prices to increase by an annual 5 percent this year.

FNB reported last week that its index showed average house prices rose 6.8 percent last year, a slowdown from 7.1 percent growth in 2012.

After adjusting for consumer price inflation, average real house price growth slowed to 0.8 percent from 1.3 percent in 2012.

Loos said it was the second successive year of slight positive real house price growth following four years of average real price decline.

FNB has forecast average nominal house price growth of 9 percent for this year but expects price growth to again slow next year based on its forecast that interest rates could start to rise in 2015.

Mortgage bond originator ooba said its statistics showed the average house price rose by 5.6 percent last year to R911 322 from R862 940 in 2012.

(Business Report)


  Comment on this Article

  Please login to post comments

Post to my facebook wall
  
2000
Characters remaining


    Latest Property News
    • 22 Nov 2017
      The end of the year is fast approaching, and so are all the travellers, tourists and holidaymakers. For those who live near or own a property in a holiday-hotspot, the festive season also brings with it an abundance of short-term rental opportunities. Its a great way for property owners to make a few extra rand for their own holidays or to put towards their savings.
    • 21 Nov 2017
      The buying process is over, and the moving truck has delivered your household goods to your new property. Now it’s time to unpack and turn your new house into a home.
    • 21 Nov 2017
      When an offer to purchase a property is signed by both buyer and seller, this constitutes a binding agreement or “Deed of Sale” between the two parties. However, in most cases the “standard contract” might not be enough to cover all the specifics pertaining to the sale. The agreement may require some additions or alterations to clauses, which needs an expert hand in the drafting of such
    • 21 Nov 2017
      As more and more South Africans look to invest in property abroad, Spain is offering them one of the best deals in global real estate.
    • 20 Nov 2017
      Since 2012, sectional title complexes have been leading the South African property market, not only in terms of price growth, but sales volumes as well. Remaining relatively strong, even in the face of 2017’s political and economic turmoil, experts say this market segment could offer valuable insight into South Africans’ property purchase priorities.
    • 20 Nov 2017
      Regardless of whether you are purchasing your first start-up home, downsizing or moving in with roommates, finding ways to maximise small spaces can be a big advantage, says Adrian Goslett, Regional Director and CEO of RE/MAX of Southern Africa.
    • 20 Nov 2017
      Property valued at approximately R1 billion is on High Street Auctions’ sales floor during the month of November, including the much-anticipated sale of the Tshwane Mayoral Residence and the land occupied by one of South Africa’s oldest operating gold mines.
    • 17 Nov 2017
      FWJK has announced the launch of its latest residential brand, the Lil’ Apple, which will be launched simultaneously in two developments in Cape Town and Umhlanga totaling 600 apartments. The Lil’ Apple is set to be a brand of FWJK’s New York style apartments which will be rolled out nationally.
        
    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