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SA property market bucks gloomy trends
D espite an uncertain economic environment ‚ South Africa ’ s property market is still an attractive option for investors ‚ says property analyst Shaun Rademeyer .
“ Despite a number of bleak predictions for both the economy and the residential property market for the year ahead and the somewhat unconvincing plans set out by Zuma in his recent SONA address ‚ savvy investors can look to capitalise on the very real opportunities that current market conditions present ‚” says Rademeyer ‚ CEO of mortgage originator Betterlife .
Residential property demand flourishes when stock markets and other sectors are under pressure ‚ he says .
“ Despite dips in foreign investor confidence ‚ with the falling rand and the threat of ‘ junk status ’‚ South Africa continues to remains an attractive and affordable property destination for overseas buyers ‚ and we are likely to see more activity in this sector .”
Rademeyer says South Africa ’ s housing shortage will continue into 2016 ‚ and demand will continue to outstrip supply ‚ especially in urban areas ‚ making for a more balanced market .
“ Ultimately ‚ there are still more buyers in the market than sellers ‚” he says ‚ “ and what 2016 may well introduce ‚ is a shift from the strong sellers market we ’ ve experienced in past years to a more balanced market .
Interest rates expected to rise twice this year
The SA Reserve Bank will raise interest rates twice more this year , despite a sickly economy , as inflation remains stubbornly above the bank ’ s comfort level , according to a Reuters poll .
The outlook is similar to other emerging markets that are experiencing a near stagflation environment compared with developed countries , which are at pains to get the quicker inflation needed for a sustained recovery .
Inflation is only expected back on target two years from now , leaving economists convinced the SA Reserve Bank ’ s hiking cycle is not over , a survey of more than 30 economists taken in the past week showed .
“ With prices likely to remain pressured for the remainder of this year , we expect to see an even more hawkish Reserve Bank ,” Rafiq Raji , the managing director at Macroafricaintel Investment in Lagos , said .
The central bank raised rates in March by 25 basis points to 7 percent and said that with upside risks to inflation forecasts and the protracted period of the expected target breach , further tightening was required .
Economists now expect the repo rate to end the year at 7.5 percent .
Estate agents to sign anti-racism pledge
R acist behaviour in the property industry has compelled the Real Estate Business Owners in SA ( Rebosa ) to take a stand against acts of discrimination , with the aim of making it mandatory for estate agents , nationally , to take a pledge against racism .
The pledge , which was launched two months ago , was created in the wake of the racist remarks made by former estate agent Penny Sparrow , who on Facebook described black beachgoers as “ monkeys ”.
Rebosa chief executive Jan le Roux said : “ Everybody I met felt terrible about the Penny Sparrow saga and how badly it affected our industry … to address this problem agents in general can show clients the pledge .”
Rebosa , formed in 2012 , comprises national property companies including 500 smaller businesses and about 15 000 estate agents .
The pledge reads : “ I pledge to work towards eliminating discrimination , whether by reason of race , gender , sexual orientation , ethnicity , nationality , disability , age or religion … I pledge to aggressively promote professionalism in the real estate industry and work towards creating a robust environment , free from discrimination in all its forms .”
However , Le Roux said sellers often dictated conditions of sale to the agents who then had to make a moral choice .
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6 MAY 2016 SA Real Estate Investor www . reimag . co . za