SA’s housing market showing cracks
SA’s housing market is set to remain in the doldrums for some time because of economic and political uncertainty — but increased rental demand could support buy-to-let returns
South Africans can forget about a real recovery in the value of their homes any time soon. Political noise and economic uncertainty continue to weigh increasingly on consumer confidence, putting the squeeze on house prices. The cracks are even starting to show in Cape Town, which has enjoyed an unprecedented housing boom for five years, with upcountry buyers flocking to the Western Cape. FNB property strategist John Loos recently told a seminar in Johannesburg that "SA’s housing market is likely to be mired in mediocrity for a number of years".Loos warned that even Cape Town homeowners should brace themselves for what may be a prolonged period of stagnating house prices, given various issues, including lack of affordability and water shortages. "These concerns are bound to put a brake on Gauteng buyers’ enthusiasm for moving south," said Loos. Average house-price growth for SA could slow to 3.2% for 2017 — down from 4.8% last year, Loos said. The outlook for 2018 remains equally ble...
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