Booming US housing market has lessons for SA

Against predictions of a slowing property market, US housing starts jumped

14,5 percent to a 33-year high in February, and the major factors that

brought this about are also reflected in the SA economy.

"Low interest rates, higher employment and continued economic growth are

underpinning the US housing market - and we are experiencing similar

economic conditions," says Gerhard Kotzé, CEO of the ERA South Africa

property group.

Kotzé, who has just returned from the annual business conference of the

multinational ERA group held in San Francisco, says the mood in the US is

upbeat, with delegates confident that the housing market bull run is far

from over.

"It's common cause that the housing market, with its huge multiplier effect,

has been one of the major factors in the continued growth of the US economy,

and right now, barring any major shock to the global economic system, the

short to medium term outlook for the US property market - and economy- is

still sound.

"The lesson for South Africa is that the local housing market has to be

nurtured if we want to continue to see solid economic growth.

"Interestingly many US homebuilders have also been saying that they are

offering bigger incentives to lure new buyers into the market and we have

perhaps reached a similar stage in South Africa.

"And in keeping with that, it's arguably time for new Government incentives

in addition to the concessions on transfer duty announced in this year's.


"Here I am thinking along the lines of tax concessions on bond payments or

at least on the interest portion of bond costs, as applies in the UK and the

US, or perhaps even especially-reduced interest rates for home loans."

ERA International now has more than 40 000 agents worldwide. The annual

business conference was attended by more than 6000 delegates, and the

15-strong SA contingent included top agent Angeline van Tonder of ERA Brink

Brakpan and top brokers Chris and Renée Breytenbach of ERA Rustenburg.

Loading comments
More news articles
Guidelines to securing a home loan
29 May 2018
Many young South Africans are working hard to achieve their dream of purchasing their first home. However, the process can be challenging due to the daunting application process, which can take up to 2 years and is often enough to discourage prospective buyers.
read more
Things you should consider before upgrading to a new home
23 Apr 2018
The thing about the property ladder is that at some point in our lives we all have reason to want to climb a rung or two higher. Sometimes, it’s because we’ve outgrown our previous dream home, or because we want to be in a better neighbourhood that’s closer to work or to schools. Sometimes it’s because our circumstances have changed, and we’re taking care of elderly parents or relatives. Sometimes, it’s just because we want a property that reflects the financial status our hard work has won.
read more
Get pre-qualified
Make offers with confidence knowing what you can afford. Then shop for the best home loan
Bond Calculator
Calculate the estimated repayments on a home loan and savings with extra payments