Down­scal­ing: no use to wait un­til mar­ket picks up

Weekend Argus (Saturday Edition) - - PROPERTY -

THE ECO­NOMIC cli­mate has been tough for a while now, and many peo­ple who have been con­sid­er­ing sell­ing to down­scale have pos­si­bly been hold­ing out un­til things get bet­ter, but this is not al­ways the right train of thought, says Lan­ice Stew­ard, man­ag­ing di­rec­tor of Knight Frank Res­i­den­tial SA.

“All the ba­sic fac­tors that drive the prop­erty mar­ket re­main the same, whether it’s a good eco­nomic cli­mate or bad, if you sell at a high price it is likely you’ll be buy­ing at a high price and vice versa,” she says.

All the ba­sic driv­ers of the prop­erty mar­ket con­tinue to be present and all that hap­pens in an eco­nomic slump is that some of the de­mand be­comes pent up or less sat­is­fied for a pe­riod of time. Fam­i­lies will still need to move to ar­eas with good schools, be near a univer­sity or col­lege, have ex­tra space to work from home or to

‘Wait­ing un­til the per­fect time to sell means you pay more for the re­tire­ment home’

ac­com­mo­date an ex­tra mem­ber of the fam­ily, or to down­scale or move to an es­tate.

Al­though more ex­pen­sive prop­er­ties tend to take longer to sell at present, there are still homes that do sell quickly or in a rea­son­able amount of time, and the R1 mil­lion to R4m mar­ket is rel­a­tively ac­tive, she says.

“There are some prop­er­ties that sell al­most im­me­di­ately, par­tic­u­larly when priced cor­rectly, and if they’re in high­de­mand ar­eas be­cause of the schools, such as Ron­de­bosch,” she says. “In cer­tain ar­eas, like Con­stan­tia, homes in the R4m to R6m price bracket are in de­mand and the cor­rectly priced stock sell fairly quickly.”

Wait­ing un­til the per­fect time to sell your home, with a view to down­scal­ing, will in all like­li­hood mean you pay more for the home you’re re­tir­ing to.

“The right ap­proach if you will be re­tir­ing soon, is to sell as soon as the de­ci­sion is made and buy in a re­tire­ment vil­lage, so that is the fi­nal sale and pur­chase of your life. The vil­lage should have all the fa­cil­i­ties you might need as you get older.”

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