Property Barometer - Home buying estate agent survey - 1st Quarter 2012
FNB - South Africa
IN SUMMARY – AGENTS POINT TO MILD IMPROVEMENT IN THE RESIDENTIAL MARKET, BUT FINANCIAL STRESS STILL REMAINS SIGNIFICANT, AND THEY HARBOUR MODERATE EXPECTATIONS REGARDING THE NEAR TERM
The FNB Estate Agent Survey is a useful tool with which to gain insight into residential market trends first hand,because estate agents experience changes in the market arguably before any of the other market role players. In the 1st quarter Estate Agent Survey, the sample of agents surveyed suggests some mild strengthening in the market. They saw demand strengthening, the supply of residential stock is seemingly becoming more constrained for some, the average time of properties on the market declined, and slightly less sellers having to drop their asking price to make the sale.
Much of this improvement can be attributed to seasonal factors, but it is possible that stronger economic growth since late-2011 is playing a role through boosting household disposable income and thus residential purchasing power.
Agents do also, however, point towards a still-very significant level of financial pressure, which manifests itself in a still high percentage of sellers downscaling due to financial pressure, and this should be a concern given that interest rates offer huge relief at their current multi-decade lows.
The agents surveyed harbor moderate expectations regarding near term future activity, with many still citing the tight bank lending environment as a key constraint on the market.
FNB Property Barometer_Home Buying Estate Agent Survey_1st Quarter 2012
Property Barometer - Gauteng Estate Agent Survey - 1st Quarter 2012
FNB - South Africa
GAUTENG ESTATE AGENTS POINT TO SIGNIFICANTLY STRONGER DEMAND IN THE 1ST QUARTER OF 2012
The 1st Quarter 2012 FNB Estate Agent Survey, completed in the month of February, came out with a mildly more positive national view of the domestic residential property market, largely thanks to a significant improvement in the market perceptions of the Gauteng Region’s estate agents surveyed. By comparison, the Coastal Metro Regions’ agents remained more subdued.
The FNB Estate Agent survey is of a sample of estate agents predominantly in SA’s major metropolitan regions (Gauteng, Cape Town, Ethekwini and Nelson Mandela Bay). The 1st question asked to agents is with regard to their perceptions of residential demand in their areas, a subjective question on a scale of 1 to 10, with 10 being the strongest level of demand.
The 1st quarter Gauteng Residential Demand Activity Indicator rose significantly from the previous quarter’s 5.86, to 6.51. By comparison, the combined Coastal Regions’ Demand Activity Indicator was almost unchanged at 5.39 in the 1st quarter from 5.38 in the previous quarter.
We caution about the interpretation of the 1st quarter Gauteng improvement, as the 1st quarter is generally a seasonally strong period. But the difference between Gauteng and the rest of the major metro regions is now significant, and perhaps ties in with the Economists.co.za major provincial economic barometers which suggest that the Gauteng economy has been the strongest of the major provincial economies recently.
FNB Property Barometer_Gauteng Estate Agent Survey_1st Quarter 2012
Differences between the 'experienced property developers' and others
Iolproperty.co.za - South Africa
The last four challenging years experienced by the SA residential property development sector have revealed clearly the big differences between the experienced developers and those who are still relatively new to the game says Shiraaz Hassan of Asrin Property Developers.
"It has been said," said Hassan, "that when the foundations for a new scheme have begun, over one-third of the work it entails has already been done. What this means is that the investigations, planning and the essential liaison processes with government parastatals, municipal authorities and interested and affected parties have been completed. It is a lack of thoroughness in these matters that has caused so many delays and resulted in so many of our colleagues' projects failing to be launched, even though they appeared to have potential."
The initial due diligence process, said Hassan, is especially important to the success of the entire scheme.
Give Your Children a Boost Up the Property Ladder
Ooba - South Africa
The South African property market currently favours buyers, with improved affordability and low interest rates providing potential home owners with the perfect opportunity to start climbing the real estate ladder, especially young adults looking to make their first purchase. However, many young first-time buyers are not able to take advantage of favourable market conditions due to the fact that they simply cannot afford a deposit. In select cases however, their parents are able to assist by providing them with money for a deposit, whether as a gift or a loan, and can potentially gain significant financial benefits in the long-term.
According to Kevin Mountjoy, National Sales Manager at ooba, many young adults can afford home loan repayments, but are unable to secure a home loan as they don't have a sizeable deposit available. The average deposit is 14.9% of the purchase price and as banks tend to look favourably at buyers with a deposit, insufficient deposit size is one of the main reasons a bank will decline a home loan.