Housing market to stay flat in 2010

THE residential property market in South Africa is still coming to terms with the fallout from the economic crisis, said Auction Alliance yesterday.

According to SA’s largest auction group, sales trading activity is increasing as home buyers take advantage of a slower recovery.

“South Africans are now seeing a repeat of the lengthy property downturn last experienced in the early 1990s. Opportunistic buyers are finding great deals which is boosting trading volume. What is unique about this property contraction is that low values are coinciding with low interest rates. It’s thus bargain- hunting season for those with access to funding,” said CEO Rael Levitt, adding that the outlook for the second half of 2010 is flat.

The World Cup has been a great shot in the arm for local tourism and retail trading but a full property recovery is still 12- 18 months off, even in a reasonable interest rate environment and even with reasonable market stability, Levitt said.

“Those who were expecting the real estate market to quickly recover after the World Cup may be in for a long wait.”

Alliance predicts a flat real estate market with no increase in value through December .

This is echoed by Absa senior property analyst Jacques Du Toit, who says that year-on-year growth in house prices may peak soon . — I-Net Bridge

Article from: www.dispatch.co.za