Luxury, views at the top end
Lew Geffen, chairman of Sotheby’s International Realty in SA, says that with prices continuing to fall in real terms, show house attendances are suddenly starting to pick up again and buyer numbers are also starting to increase once more.
“Some of the buyers coming back into the market now were previously shut out by high prices and have been sitting on the sidelines hoping that sellers would get desperate enough and prices would fall far enough for them to be able to find homes they could afford.
“Others are savvy investors who watch the market carefully and believe that now’s the time to buy if one wants to capitalize on the coming upturn. Either way, they all seem to think that the market has ripened enough to start dealing now and we have had 11 percent more buyer enquiries in the past month than in any of the past six months.”
In addition, says Geffen, a high percentage of the transactions taking place now are cash purchases, and many of the others involve large deposits, which is encouraging because it means buyers are prepared to commit their own resources to purchase the properties they want.
“This suggests renewed belief in property and taken along with the increase in buyer numbers we certainly see it as a sign of better sentiment in the real estate market. Once buyer activity increases, excess supply starts to be absorbed and prices will stabilize.
“Then once interest rates start to go down and affordability improves even more, there will be a surge of demand that will eventually start to push prices up again. Based on what we are currently experiencing in the market, we expect that to happen a year or so from now.”
LEW GEFFEN SOTHEBY’S INTERNATIONAL REALTY
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Article from: LEW GEFFEN SOTHEBY’S INTERNATIONAL REALTY