Inflexibility won’t sell properties
THE PROPERTY market is turning, but things are still a far cry from being a seller’s market and the warning from the property experts is that buyers and sellers need to be realistic in their pricing if the deals are going to happen.
Gerhard Kotzé, CE of the ERA South Africa property group, says buyers have sensed an improvement in the market and are prepared to make offers.
“On the other hand, some sellers wrongly believe that a seller’s market has already arrived and that they can ask for prices that are 20 to 30 percent higher than a year or so ago. There is a middle ground for buyers and sellers right now, but ‘never the twain shall meet’ if they both stubbor nly cling to their respective pricing points of view.”
He says there is no question that the market has perked up compared with the doldrums of a year ago, but that it’s a far cry from the 25-30 percent annual growth at the height of the last property boom.
“That’s notwithstanding the latest FNB House Price Index’s yearon-year report, which indicates that house price deflation continues to diminish at a steady pace. The bank believes year-on-year house price deflation will probably be a thing of the past before end of the year, and that this is a strong sign that the positive impact of lower interest rates is starting to be felt in residential property performance.
“Our view is that the market is roughly in equilibrium and, in such a market, deals are best facilitated by compromise.”