ANC elections set to boost SA property prices
There is a new energy and confidence in the property market in the wake of the ANC‘s elective conference this month, and those who have been saving and planning to buy a new home in the new year should get ready to move fast.
This is according to Gerhard Kotzé, MD of the RealNet estate agency group.
Kotzé says there is a new energy and confidence in the property market in the wake of the ANC‘s elective conference this month, and those who have been saving and planning to buy a new home in the new year should get ready to move fast. “It is always better to buy sooner rather than later when it comes to real estate, because even when they are rising only slowly, home prices do keep going up. And given the current optimism about SA’s economic prospects, it seems they may start rising faster than the current low GDP growth rate might indicate. Delaying a purchase is thus likely to mean that you will shortly need a bigger home loan to buy the same property - and a higher salary to qualify for that loan,” says Kotzé.
SA property trends, predictions and hotspots for 2018
South Africa’s been through a number of upheavals during 2017, from the firing of Pravin Gordhan to the ratings downgrades. This time of instability is likely to continue in to 2018, and many might wonder what this bodes for the residential property market.
“Regardless of the current political and economic climate, people need places to live, and so the property market carries on. That being, said there are a few trends we’re predicting for 2018,” says Bruce Swain, CEO of Leapfrog Property Group.
The bad news
Amid expected poor growth in GDP (1% if we are lucky), households will come under increased financial stress and utilities, transport and school fees will likely increase faster than salaries.
Why investing in property is your best bet
The recent disaster that befell the Steinhoff share price is a prime example of the risks of investing your hard-earned money in shares. Imagine the horror of waking up to discover your investment is worth less than half of what it was the day before.
While Steinhoff shares were, until recently, considered one of the best shares to invest in, they recently fell as low as R11, a loss of over 65%, and are still highly unstable. This effectively reduced the value of the stock by more than R117 billion within the space of 24 hours.
And IGrow Wealth Investments CEO and founder, Jacques Fouché, says this case is not unique - while shares can prove a lucrative investment, equally they can cost investors their entire life savings. Wal-Mart, Exxon Mobil and Qualcomm all lost massive value in 2015. When a company goes down, they take your savings with them. History tends to repeat itself and shares are subject to volatilities that can cause devastating losses.
Homeowners: 7 steps to financial freedom
Owning a home is a long-term financial commitment that requires planning.
It is imperative that homeowners have a system in place that will help them to get through a rainy day if necessary, says Adrian Goslett, Regional Director and CEO of RE/MAX of Southern Africa.
“Irrespective of whether someone is in an entry-level job starting out their career or an entrepreneur with a multimillion-rand company, it is important to have solid financial principles in place to be able to get through the tough times and continue to thrive even when the economy is not in an ideal state,” says Goslett.
“Many affluent people lost their wealth because they did not understand fundamental financial principles. Regardless of earning potential, the same principles can be used and applied to ensure that the person has a solid foundation they can grow from. As with a home, the foundation is crucial to the structural integrity. Skipping a step will result in a shaky structure that will not stand in challenging times.”