SA homes market poised for new-era growth
“With public sentiment, nothing can fail. Without it, nothing can succeed.” – Abraham Lincoln.
In much the same way that prices of stock exchange-listed equities rise and fall in line with market sentiment, South Africa’s “share price” as a country is starting to gain value once again.
So much so that it has been tagged by Goldman Sachs as the possible breakout economy of 2018.
It is happening as our new political leadership is beginning to come together under the Presidency of recently-elected Cyril Ramaphosa.
He is now at the helm of what will soon become a newly-reconstructed, scaled-down Cabinet. And he is in a corruption clean-up frame of mind.
As a result, buying or selling a home in South Africa is becoming an easier decision to make.
A homes market-friendly Budget
And now even more so, given that the National Budget in Parliament a few days ago was relatively homes market-friendly – with no increase in capital gains tax (which has remained at 18% since the financial crisis 10 years ago). This was encouraging. All the homes market has emerged relatively unscathed.
The residential property market has always been defined by sentiment. Ironically, the Jacob Zuma presidential exit is probably the strongest positive sentiment boost we have seen since the financial crisis 10 years ago.
Good, sentiment-uplifting governance, free of corruption and uncertainty, was generally an absent factor during that period.
Now, for the first time in a long while, there is a realistic perception that clear water lies ahead of us. Uncertainty is lifting, and we know where our country is headed.
The cheapest properties in the world
It now seems hopeful that the reported R750-billion in investment capital, held back in the private sector (South African corporations and SMEs) will soon start to filter into the economy as sentiment continues to rise.
The positive knock-on impact of this perceived 180-degree turnaround in the homes market will be immense. And not least so in Johannesburg’s Northern Suburbs and Sandton, where home prices have been flat-lining for a long time.
Together they currently offer amongst the cheapest residential properties available anywhere in the world in developed and developing countries.