Property Investors and aspirant Homeowners - particularly those new to the property industry - may be at a loss at how to respond in the wake of the maiden mini-budget presented by Finance Minister, Malusi Gigaba, to Parliament in October.
To summarise, Gigaba revised the economic growth projection of 1.3% earlier in the year to a disturbing 0.7% for 2017. He forecast a slow climb to 1.1% in 2018 and 1.5% in 2019. Equally concerning was the increase in Gross National Debt to 61% of GDP by 2022.
It is important to note that these projections are dependent on a number of complex variants which are likely to change at any time. This said, it is unquestionable that Gigaba’s projections have had a sobering effect on Buyer/Seller confidence within the property market.
The question is: how will the economic growth projection for the following years affect the already cautionary approach Buyers and Sellers have adopted towards new property acquisitions?
The crux of the matter is this: The market has shown a gradual shift in favour of Buyers, which means that Sellers will need to keep their price expectations realistic and market-competitive.
Essentially a Buyer’s Market means that supply exceeds demand. In terms of property, the market is saturated with stock but there is a significant shortage of qualified Buyers. A rise in living costs and debt, an increase in retrenchment and unemployment, and stagnant economic growth (amongst other debilitating socio-economic factors) has removed many aspirant Home-Buyers from a financial position whereby they are able to comfortably acquire property. This is confirmed in the overall percentage of bond approvals currently averaging 50% of the total number of bond applications, according to ooba - in essence, the number of active, qualified Buyers has halved.
This puts serious Buyers at an advantage because there are significantly more properties to choose between and a greater number of Sellers vying for a sale, which enables them to negotiate a lower selling price.
With this in mind, Sellers must avoid pricing a property well-above it’s Market Value, as this results in a drawn-out selling process with considerable financial loss. In the same breath, Panic Selling is just as financially crippling and should also be avoided. The solution is simple: Sellers who are hoping to get the best sales price in the shortest amount of time should work alongside a respected and trusted Estate Agent who is able to advise them on setting a competitive, market-related selling price.
Why Sellers & Buyers Choose E&Y:
Our Sales Specialists are highly qualified individuals who possess a wealth of knowledge and experience in the property industry, as well as access to an extensive Buyer Database and connections to property developers and other industry professionals. Etchells & Young has a strong physical presence in and around the city, and a prominent position on online property platforms.
Our Sales Agents are responsive to the changes in the market and are well-informed on how these changes affect the buying-selling process.
Buyers and Sellers alike should expect the same personal, quality service synonymous with the E&Y brand within the property industry. Our Sales Team view Clients above Commission, and are dedicated to putting their client’s needs first - this unyielding commitment to client service has set E&Y apart since it’s inception. Etchells & Young equip their Sales Agents to give practical input and client-centred advice, in keeping with a strict code of ethics set out by the EEAB, and working closely with Conveyancing Attorneys and other industry professionals. This ensures that Buyers and Sellers receive a service they can trust!
Etchells & Young believe that a trusted Sales Agent is a valuable asset in an unsettling economic climate, and that both Sellers and Buyers would benefit from working with a reputable Sales Agency.
Despite Gigaba’s revision to the economic growth projection for 2017 and the increase in Gross National Debt, Industry Specialists are confident in the market’s buoyancy - which has proved resilient despite economic instability. Our Sales Agents are equipped to assist Buyers/Sellers in navigating the market and making financially sound decisions amidst this instability, ensuring that property continues to be a favourable investment option!