Buy now while the market sleeps
RECENT reports that up to 15000 South African real estate agencies are expected to shut down because of the dip in the property market have posed a number of challenges.
The challenges are perhaps even more acute for those who had recently opened up real estate agencies with the hope of taking advantage of the boom in the property market.
Many had not imagined that the market would suddenly take a sharp downturn.
There are several agencies, including established ones in Cape Town, Port Elizabeth and East London, which have not been able to weather the property markets downturn and have subsequently closed shop.
This is not something new; we had similar experiences in the late 90s when interest rates shot to over 20%.
Some of these companies never recovered, even when boom time hit the market.
One of the reasons for these closures is that during the boom period, some did not invest sufficient capital back into their businesses and make provision for financial reserves to sustain them during the bad times.
However, I cannot discourage those who still want to enter the market as real estate agents.
I believe this bad patch will provide them with an opportunity to accumulate a lot of properties, and when the market picks up again, they will have enough stock.
Agents should understand that the money they make is not theirs it belongs to the company, so it should nt be squandered.
The reserves built up will act as surety for the business when uncertainties hit the market.
Now is the time to attack the market and market the agency vigorously, so that when the market wakes up from this slumber, it wakes up with you.
Plan well and have faith in your business.
Article by: Xoliswa Tini Properties - www.dispatch.co.za