Selling properties on the West Coast of South Africa
 
Property still a good long-term investment

Although there has been a marked decline in activity in the property market, correctly priced properties are still selling.

The latest figures from Absa Homeloans indicate that in 2008 house price growth slowed noticeably in all price categories and across most of South Africa. However, the overall picture is nowhere as bleak as many property watchers make it out to be.

Statistics show that the buyers are out there and they will buy for the right price. Statistics also show that in some areas of South Africa, up to 66% of purchases are now cash purchases. Cash buyers have the perfect opportunity to snap up a bargain now as some sellers have lowered their prices by as much as 20%, and they will capitalise with the next property market upturn.

While the types of properties purchased range across the spectrum, properties in the R 800 000 pricing bracket seem to be popular. The high end of the property market is also healthy, despite the hardships of the past 18 months. Buyers are also showing a preference to both sectional title and freehold properties in gated communities.

Interestingly, some sellers are opting to auction their homes as opposed to selling traditionally in a bid to achieve higher prices. A bungalow on Fourth Beach, Clifton, recently fetched R 14 million and attracted serious bidding because of its location on one of the world???s most famous beaches. Sellers should remain aware that their properties will still only achieve market value at an auction.

Further interest rate cuts, the bargain house prices and a lack of confidence in the stock market could lead to increased investor interest in property once more. Property always represents a good investment over the long term. Prices are somewhat static right now but the cycle of growth will start again and conditions are expected to improve in the latter part of 2009.

The middle-to-top end of the commercial market was still very active in 2008 and investors are expected to continue with their demand for prime properties in the upper value ranges.

Meanwhile the rental market in many parts of the country is faring fairly well. Rental rates have stabilised as landlords recognise that tenants are also feeling the economic squeeze.

 


 
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