Developments in recovery
POSITIVE PHASE There are a few early signs of recovery in the development market, after this sector’s enduring a particularly difficult time over the past 18 months, says Laurie Wener, Pam Golding Properties’ MD for the Western Cape metro region. But she cautions that there is still a long way to go.
“The recession took its toll on developments, especially in the off-plan purchase category, which constitutes the majority of its sales,” says Wener. “One of the main advantages to buying off-plan is that, in a steadily growing market, one benefits from the buy-now-pay-later principle, where buyers pay a 10% deposit and the balance on transfer at completion — by which time the property would have already grown in value. But of course with the market in a negative phase, this benefit was lost, and with it a significant proportion of the appetite for off-plan purchasers.