It is too soon to say what the full impact of recent unrest in KwaZulu-Natal and Gauteng will have on residential property, although some shifts are anticipated.
Samuel Seeff, Chairperson of Seeff Property, says the outlook will “generally depend on how long it will take to quell the current violence.”
“Obviously, the longer it takes for the government to bring it under control, the higher the risk to the economy and property.”
Tony Clarke, managing director of Rawson Property Group, agrees the industry should be able to ride the wave but only if it is short-lived.
Read the latest Property360 digital magazine here
He believes, however, if any sector will be affected, it will be the first-time homebuyer, those aged between 28 and 35 years of age, who have been rising in numbers since low-interest rates came into play.
He says there may be a drop in these numbers as this younger cohort weighs up their options of moving abroad or staying in the country.
Both Seeff and Clarke say, despite the unrest, the market continued to move this week with sales recorded in Gauteng, KZN, and throughout the rest of the country.
Clarke does not believe there will be a collapse in home prices in hot spots, although both say it is a wait-and-see game.
Meanwhile, Alexa Horne, managing director of Dogon Group Properties, says if the Cape remains unscathed it might mean more people want to relocate to the province.
She has already had a few calls this week from clients in Johannesburg looking to expedite their plans to move to Cape Town and from others enquiring about property.
Denise Dogon, founder of Dogon Group Properties, says in the past year Gauteng buyers and people from other provinces made up a large percentage of their clients. The work-from-home trend has increased this.
Seeff says they have not seen an increase in enquiries for Cape property as yet, “but bear in mind that Cape property is more expensive on a square metre basis compared to other parts of the country, so it is not as easy as simply upping and moving here”.
He added that whether the notable influx of semigration buyers from Johannesburg to the KZN North Coast will taper down because of the riots and violence, “we will need to wait to see what the fallout will be”.
The agency bosses all describe South Africans as “highly resilient”.
“The country has experienced previous periods of unrest – think of the 1980s before the new democracy of 1994 when civil unrest was a huge threat,” says Seeff.
“We did not know whether we would be selling property again, interest rates soared
to over 20%, yet the country bounced back and during the economic boom of 2000 to 2006, house prices rose by an average of 20% annually.”
He added one aspect of the events of the past few days is the importance of communities putting contingency plans in place to protect their property and economies.
The current interest rate is the lowest since the 1960s and continues to serve as a significant incentive to invest in property, hence some best activity in the market has been seen over the last three years.
*Contact Vivian on email@example.com