Advice to retirees

Although some recent media reports have been ambivalent on future prospects of the Cape residential market, it is showing a slow but steady upward trend, says Lanice Steward, MD of the Cape agency, Anne Porter Knight Frank.

“It is true that there has as yet been only a small rise in prices, but the number of houses sold has now risen year on year by 20%,” said Steward.

“As the latest FNB survey has shown, in the second quarter of 2010 Western Cape house price inflation accelerated to 13,8% year on year – up from 8,7% in the first quarter, with a quarter on quarter growth rate accelerating marginally from 3,9% in quarter one to 4,2% in quarter two.”

This, she said, is further evidence that the “prudent” National Credit Act has proved to be exactly what the country needed – and has very definitely prevented SA experiencing the severest effects of the collapse in the market that the UK and the USA went through.

Where there has been a noticeable slow down, said Steward, is in the flow of people scaling down to retirement villages.

“There is a tendency here,” she said, “to wait until the market will give a better price for the home owner’s current house. As I have said before, this strategy can backfire because retirement villages also increase in price year on year and the current vacancies in the villages could come to an end. It is best, therefore, to “go for it” now rather than await better conditions down the line.”

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