Herschel Jawitz CEO Jawitz Properties - State of the residential market

Posted On Monday, 31 October 2016 13:02 Published by
Rate this item
(1 Vote)

The current residential market continues to reflect the state-of-the-nation and the economy, both in terms of price growth and the level of consumer and business confidence.

HERSCHEL_JAWITZ_CEO_JAWITZ_PROPERTIES

Year-on-year, there has been a shift to a buyers’ market, with fewer buyers, more sellers and reduced sales.  In the current market buyers look for value and tend to favour similar properties for less in lower-priced suburbs.  Regrettably, many sellers are still not heeding market-related prices which of course, means that homes take longer to sell. 

According to the latest FNB Residential Activity report, properties now take, on average, fourteen weeks to sell, up from eleven weeks in the previous quarter. Nationally, property price-growth is barely keeping up with 6% inflation, so in real-terms there is little, to no growth. For real-price growth, 2016 is likely to ‘breakeven’.

Properties in Cape Town and the Western Cape continue to outstrip supply. Considering desirable factors such as lifestyle and sea-views and a general scarcity of homes on offer, there is a different level of buyer confidence in this region.

There is a strong sense that there is less crime and corruption, better infrastructure and a well-run province makes the Cape a desirable place to live. However, this comes at a price. With the replacement cost of a property in Cape Town when compared to Johannesburg, it is between 30-40% more.

At the luxury end of the market, an increasing part of this demand is coming from executive semigration as families relocate from Johannesburg to Cape Town while maintaining their business interest on the Highveld. The Western Cape and specifically Cape Town will be the star performer with property price growth expected to be at or close to double digits in 2016

“Despite low consumer confidence, there are still sales taking place. Currently, we are in a stable interest rate environment which impacts positively on affordability and sentiment. Fortunately, there has been no noticeable tightening of the bank’s lending criteria.

The common denominator in this market is price. In a buyers’ market, sellers are competing with other sellers for fewer buyers. There are quality buyers and banks are lending. How long a property stays on the market and at what final selling price depends entirely on how quickly the seller will respond to the market,” says Jawitz.

Last modified on Monday, 31 October 2016 13:21

Most Popular

Growthpoint begins construction of the Kent residential apartments in KZN

Aug 26, 2021
Marius Els, Development Project Manager at Growthpoint Properties
Growthpoint Properties (JSE: GRT) has commenced the development of Kent, its first…

On Auction: Iconic Redevelopment Opportunity in Oranjezicht Cape Town

Aug 26, 2021
The_Lenox
Currently operating as a 43 room guesthouse / backpackers.

On Auction: Spacious offices with multiple amenities in Norwood

Aug 26, 2021
Default Image
Spacious offices with multiple amenities on Auction in Norwood.

On Auction: Retail & Offices Property with unutilised bulk in Rivonia Johannesburg

Aug 26, 2021
KTM_Building
The anchor tenant is Road Adventure Dirt (Pty) Ltd (RAD) which is the premier KTM…

Prevance Capital launches the Executive Premier Funding Solution, targeted at experienced, successful property developers and businesses in South Africa

Sep 14, 2021
Are you tired of waiting for lengthy traditional funding methods to be approved? Prevance…

Please publish modules in offcanvas position.