January 2021 News + Views
The past six months have been very good ones for the real estate market in SA – and especially for home sellers, as buyer demand, low interest rates and the availability of finance combined to drive sales to frankly unexpected levels.
But unfortunately, we don’t think this momentum can be sustained in the coming year – even though inflation is likely to remain depressed and the Reserve Bank is likely to keep interest rates really low.
So our advice to any property owner who needs to sell now, for whatever reason, is to do so as soon as possible, and not to delay in the hope of selling at a higher price in a few months’ time.
And the reason we say this is the predicted real increase in SA’s already very high unemployment rate as the relief measures that were to some extent masking the real economic effects of the Covid-19 pandemic steadily come to an end, and families exhaust whatever private resources they may have had.
As things are now, even middle- to upper-income consumers (who are usually better insulated against economic shocks) are currently struggling to make ends meet as the number of business closures and pandemic-related retrenchments continues to rise.
The banks are of course very aware of this and already tightening up on their home loan credit criteria in response – which means that it is going to become more difficult for prospective buyers to obtain bonds, and that even if demand remains high, there are likely to be fewer actual home sales this year.
The recent decline in the number of SA affluent homeowners who are planning to emigrate – or who are able to at the moment - is one positive for the market, and especially for the smaller towns and coastal areas that are seeing a surge of executive semigration driven by the remote-working trend.
The Rand is also still at attractive levels for foreign buyers of SA property when compared to dollars, pounds or euros, which will help to bolster the luxury market once there are fewer travel restrictions between countries and continents.
However, there is no doubt that the number of distressed sellers will increase this year and bring more inventory back into play, alongside more landlords who have been struggling for months with non-paying tenants and now decided to offload some of their rental properties.
Consequently, we think that supply and demand are likely to remain very much in balance and that this will keep a real lid on home price increases this year, with the possible exception of some localised spikes. And while this does not mean that we have a gloomy outlook for the next 12 months, it does mean that we think those who are planning to sell should move fast and be willing to negotiate to get deals done.
Warm Property Regards
In the news this month
Top trend: It’s back to the ‘burbs - with Mom and Dad and fam
As Generation Z flocks to the cities, more and more members of Generation Y (more popularly known as Millennials) are steadily moving back to the suburbs to live with their parents and often, other members of their family too. And this migration is not only about money – or perhaps the lack of it, as more and more people watch jobs and businesses disappear in the wake of the Covid-19 lockdowns. It’s more about having more living space and gardens and the company of other people you like and trust. Millennials, now aged between about 26 and 40, are renowned...
Getting back to nature – at home
In the wake of the Covid-19 pandemic, many more people will be working remotely – this is, from their homes – either full time or for much of the week, and will need a home office or other dedicated space to do so. However, schooling and after-school activities are also unlikely to get back to “normal” for a long time, if ever, and as many parents have already discovered, this means that their children also need more space, for online lessons, homework and play, that is preferably separate from their own home workspace...
Market review: Riversdale, Western Cape
Accessible via the N2 highway between Cape Town and George, Riversdale is one of many small towns around the country that have recently experienced an increase in property enquiries as a consequence of the growing remote working trend. A charming and historic little farming town, it lies next to the Vette River to the south of the Langeberg mountain range and is overlooked by a specific formation known as the Sleeping Beauty. It only has around 2800 homes, and according to Chas Everitt Southern Cape principal Charles de Kock...
Riversdale - 2 Bed - R1 250 000 Riversdale - 4 Bed - R1 595 000 Riversdale - 4 Bed - R3 300 000
Properties For RENT
Cape Town Gardens - R15 000 pm Rosebank - R24 000 pm Cove Rock - R30 000 pm
Properties For SALE selection
Ormonde - R1 400 000 Wavecrest - R1 400 000 Bateleur Estate - R1 550 000
Blanco - R1 950 000 White River Estate - R2 500 000 Oewerzicht - R2 650 000
Hermanus Heights - R3 950 000 Bankenveld Golf Estate - R4 900 000 Bergvliet - R6 250 000
St Francis Canals - R6 500 000 Tamboeskloof - R9 999 000 Camps Bay - R11 900 000
Your Area Specialists:
Chas Everitt International sales agents have all the latest market information regarding local property values at their fingertips – and are committed to the highest standards of personal service when it comes to selling your home. In addition, the Chas Everitt International Property Group offers you, the homeowner, the best possible exposure for your property in both national and international markets. So if you are thinking of selling your home, call your nearest Chas Everitt International office today for the name of your local area specialist - or visit www.chaseveritt.co.za
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