Estate agency flexibility is the key to survival in the current market slowdown
|Ivan Neethling, Chief Executive of the estate agency, Startpop,
outlined some of the tactics which have helped agencies such as his to survive
the worst downturn in the property market for 20 years and he went
on to predict that the long awaited stabilisation of prices is now not far
Agencies, said Neethling, had had to be able to read market trends and respond appropriately to these if they were to ride out the enormous challenges of the current housing market.
The first factor for survival, he said, was that agencies had to have enough stock in widely diversified areas to be able to offset the lack of finance from the banks.
Secondly, the agencies in the lower priced markets had to be capable of oscillating between the low and medium cost housing markets as the banks found value and granted bonds in these areas.
Neethling said that the banks at last appear to be regaining some of their former confidence in the housing sector and the reason for this, he believes, was that the current trends indicate that the long awaited bottoming out of prices is about to take place.
In Startprops Southern Suburbs and Cape Flats branches the 15% to 20% price drops are now levelling off. We are not, as yet, seeing price rises but homes are at last beginning to hold their value.
This, Neethling admitted, contradicts recent OOBA and other predictions which see prices falling a little further before a recovery begins to be evident, but Cape property had always been more resilient than that of other provinces.
Those looking for buy-to-rent investment opportunities, said Neethling, should take note that the strongest demand is now very definitely in the sub-R500,000 bracket where a host of very keen buyers are itching to become property owners but have thus far been held back by the National Credit Act. They could, he said, re enter the market once the anticipated 2% to 3% interest rate drops being widely called for all over South Africa are implemented.
Article by: www.startprop.co.za