Property ‘on brink of upswing’
IT WOULD seem that certain sectors of the property market are on the brink of an upswing, according to Park Village Auctions (PVA) property division head Jaco du Toit.
“Demand for residential property is definitely on the increase, most notably in some of the country’s most affluent suburbs, which hints at an impending upswing. High-end buyers are usually pretty knowledgeable about property investment and tend to act when conditions favour them.”
Demand for commercial property on the other hand remains fairly weak amid challenging market conditions which look set to remain for the rest of the year, Mr du Toit says.
On the industrial and retail property front, he says property fundamentals are improving but cost containment may prove problematic, given rising labour, administrative and utility costs.
Interestingly, Mr du Toit says a boom in the warehousing sector looks certain, with demand for such property increasing rapidly. This is good news for Park Village Auctions given the number of these properties that regularly come its way.
“It is interesting to note the uptick in activity in the various sectors, it indicates that investors are finally getting off the fence and are willing to invest once more.
“While it has become increasingly apparent that tenants are prepared to pay a premium for efficient buildings in prime locations, it remains to be seen what the impact of looming municipal increases and operating costs will have on investor appetite.”
Meanwhile, Park Village Auctions asset recovery division head LeRoy Augustyn says the prices being achieved at the company’s auctions are still good in spite of tougher trading conditions.
“The fact that PVA only deals in genuine bank repossessed vehicles and assets keeps buyers coming back.
“There will also always be demand for secondhand, quality goods which also works in our favour,” Mr Augustyn said.
Commenting on the truck market with which he is directly involved, he says sales of mediumsized commercial vehicles, heavy trucks, extra-heavy trucks and buses are up both at auctions and in terms of new vehicle sales.