Real Estate Investor Magazine South Africa November 2015 | Page 38

INSIGHT

2015

Property Market

Performance

SA’s Sale and Rental trends throughout the year
BY DREW HOOK

T

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he International Monetary Fund has cautioned
that there are ‘7 lean years ahead for South
Africa’. This weakened economic outlook will
no doubt put downward pressure on the local property
market and result in interest rate hikes from around
Q1 of next year.
However, the market fallout is expected to be better
than post 2008/8, as the mass of distressed property
and oversupply of stock that characterized the market
of 2007/8 is not as pronounced. And while the market
outlook for 2016 remains positive, the “boom” is over
for now and it is back to business as usual. Sellers need
to remain realistic with their price expectations and
Buyers need to ensure they budget carefully and buy
within their means.

fast the previous period, with the average days spent on
the market averaging around 12.3 weeks.
The coastal regions are currently seeing good
activity and balance in the market with a number
of R20m+ sales while stock shortages are seeing an
uptick in development, particularly in Sandton and
the Johannesburg inner city. There has been strong
demand in the rental market, with top end rental rates
reaching highs of around R80k –R100k per month in
high end, luxury areas such as the Atlantic Seaboard,
Constantia and Sandton. This demand is likely to rise
in the middle class areas over the next year given the
economic downturn. But on the whole the property
sector has remained a stable performer in the current
economic climate.

Market Snapshot
The overall market performance of 2015 was down
by approximately 7-10%, but still performed better
than the period from 2009-2013. The average national
housing price for 2015 was just above 1.026M, while
stock levels were low with healthy buyer demand (show
house attendance being higher than the 2009-2013
period). Well-priced property has been selling twice as

Western Cape
The Western Cape market remained in a balanced
state, with a slight drop in the market of around 10%.
Stock levels remained tight with very little oversupply
and some areas experiencing an undersupply of new
housing. The bulk of activity came from the sub-R15M
price range in areas such as the Atlantic Seaboard, City
Bowl and Southern Suburbs. Although there has been

NOVEMBER 2015 SA Real Estate Investor

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