“The rand surged to the strongest level against the dollar in more than seven months with the announcement of Ramaphosa as ANC president."
The result of the ANC elective conference has been a “breath of fresh air”, boosting consumer confidence and improving the value
of the rand, says Jawitz’s Francois Venter.
As the property market is driven by consumer confidence, economic and political improvement could see lower levels of inflation and lead to lower interest rates, and this puts less pressure on consumers, he says. Restored investor confidence following the political developments last month will be one of the biggest highlights of the year, says Greeff Properties’ Mike Greeff.
“With investors offering their backing to new ANC president Cyril Ramaphosa, there should be significantly increased activity in the property market as people feel less apprehensive about getting their feet into property waters.
“The rand surged to the strongest level against the dollar
in more than seven months with the announcement of Ramaphosa as ANC president. Ramaphosa is viewed globally as being exceptionally
business-friendly and pro-investment.”
The Seeff Property Group welcomed Ramaphosa’s election as
“excellent news for the country, economy and property market”, says chairman Samuel Seeff, and a positive effect in the market
has been seen, with the currency improving to some of the best levels in recent years against the dollar.
It is hoped that Ramaphosa’s election will have a beneficial effect on the economy and property market, with some indication
that conditions are already conducive for a potential interest rate cut.
However, basing his 2018 predictions on the latest Rode’s Report on the SA Property Market, Erwin Rode of Rode & Associates says the residential property market in general, unlike financial markets, is not directly and immediately linked to the economy or sentiment.
On top of that, the outcome and timeline of ANC politics are “still opaque”, although “South Africa has dodged the National
Development Zone bullet”. Agreeing that the country remains in a “phase of caution”, Seeff says while Ramaphosa’s appointment is good news, many factors are still affecting the market.
Political instability remains a concern – stability on this front is needed to support economic stability and growth. Furthermore, the 2018 budget next month will “naturally bring some challenges” as Finance Minister Malusi Gigaba has already prepared the country for weak economic growth and rising sovereign debt levels “which all point to the potential for higher taxes and other costs this year”.
Although we’ll need to wait until next month to determine how the government plans to restore the sustainability of the fiscal policy and achieve some sort
of debt stabilisation, Pam Golding Property Group’s Andrew Golding emphasises that, even in this environment, people need somewhere
There is a realistic sense that there is a huge pent-up demand for property at the right
price, and in the right location.
“Underpinning the ongoing sustainability of our housing market
is an ever-increasing demand for housing spanning all sectors and price bands. This is further being fuelled by an emerging middle-class which is becoming increasingly prosperous.”
Golding says a young generation of aspirant homebuyers and
renters, semigrants and people relocating as normal life stages and events drive activity, are all ensuring continued demand in the
Like us on Facebook