Recovery in major centres points way
ALL THE major South African metros are showing signs of a property market recovery and this is likely to start spilling over into smaller centres soon, says Gerhard Kotzé, chief executive of the property group ERA, based on feedback from their offices countrywide.
“Some metros are doing better than others, but there’s a consistent pattern across the board and that bodes well for the market in general,” he says.
“ J o h a n n e s b u r g , C a p e Tow n , Tshwane, eThekwini and Mandela Bay are all showing a significant rise in demand for residential property, an improvement in confidence levels and sellers are more realistic about pricing.
“Clearly the positive effects of interest rate cuts of five percentage points since December 2008 are increasingly being felt, and reflected in more property transactions and improved bank lending.”
The ERA group’s experience corresponds to the findings of the FNB Property Barometer in the third quarter of last year, which were based on a survey of estate agents’ opinions in the various regions.
Kotzé says that region by region the Joburg area is trailing somewhat in activity levels in the property market, compared with the three major coastal areas surveyed, whereas Tshwane has a slightly stronger reading than its neighbour.
“However, compared with the soft market we have had since the start of the global meltdown, the overall outlook is definitely far more positive now,” he says.
Other pointers to the improving situation, he says, are that the percentage of properties being sold at below their listed prices has dropped significantly and the average time of a property on the market before being sold has fallen to about 3.5 months in eThekwini, four months in Joburg, Cape Town and Mandela Bay, and 5.5 months in Tshwane.