Site Comments - First off great site, I've been looking for a local ZA site such as this for a long time. Currently a paid member on Treoc forums and advice offered here far out weighs theirs.
What 2009 Holds in Store for Real Estate Investing
Thursday, 29 January 2009
Compounding factors over the last two years have effectively caused residential property markets to come to a stand still. Has the market bottomed out, will international bailouts be able to overcome the credit crunch? Everyone looking to 2009 for change. But will relief come?
Before delve into the issues, we would like to mention that some investors are quite happy with this situation. They've managed to double their portfolios in this market and plan on buying more. For these people the problem is just finding the right deals and getting financing. But for many investors and home owners looking to sell their properties, a breather in 2009 will be most welcome.
As banks have started tightening their lending criteria, many complaints have been heard from investors in the position to buy. After all, there is no point in having bargains everywhere when there is no finance to gear with. That is why we would like to remind people that putting capital aside for such times is crucial and essential. It's what separates you from the pack and allows you to do business as usual while everyone else bunkers down. All veteran investors know that without capital there is no investing, because there is nothing to invest.
So, will 2009 be the turnaround in property after 2 years of hardship?
Interest rates have now gone up 450 basis points and a further hike this year cannot be excluded from planning. Along with this, fuel, food and energy prices are set to increase. Most of this woe is outside the control of the South African Reserve Bank, but nonetheless impacts heavily on an already straining economy.
Things are looking pretty rosey as the perfect storm begins to brew. Perfect for Property Investors.
In this market properties are “dumped” on the market in a last minute desperate attempt by owners trying to avoid repossession. Everyone tightens their belts and their budgets, business included. Layoffs follow, costs go up and inflation is the word on everyones lips.
The long speculated market downturn is undeniably here. No need to speculate, it's on the streets and creating havoc. The stage is set for the perfect storm.
As you all know by know Philip Viviers is one of the Experts on Property Investor Network and we just wanted to give you his summary view the 2008 Budget as he wrote it:
With everything that has been happening to the the South Africa property market in 2007, and a lot has happened other than the NCA and interest rate increases, there are two options a property investor can look at:
Pack up and go home, do not invest anymore and live in the depression mood or increase in interest rates, NCA and other worries, or
Take the opportunity to continue investing in a counter cyclical market.
If you don’t mind, we would like to discuss option 2, as option one is not very productive if you come to think of it.
Did the NCA save South Africa from a fate similar to the US?
Saturday, 29 September 2007
Many members of the Property Investor Network have expressed their concern with the newspaper headlines surrounding the NCA and also the fact that several banks seems to have suffered as a result.
To better understand the effect and bigger picture, let's look briefly at the situations in other leading property markets, such as the US and UK. This will help put a perspective on the South African market.
How Does the American Property Market Influence South Africa
Saturday, 29 September 2007
Recent property media has been abuzz with news of the real estate down turn occurring in the United States. With all the media sources available today you can’t possibly avoid hearing about the doom and gloom of the US Property market, not unless you live under a rock, in which case it won’t affect you anyway. News travels fast and stories of the downturn in US real estate markets is quick to hot South African shores where people are now, as a result of the phenomenal property boom experienced in local markets over the past few years, sensitized to real estate and the wealth creating benefits thereof. As news hits our shores many are contemplating how the US down turn will affect the local property market.
The estate agent community has expressed extensive concern over the NCA. Is the picture really that of gloom and doom? Just as with other articles this month, the answer is yes or no, depending on your perspective. To help you decide which, this article takes a broader view of the picture so that we all can hopefully make more sense of the situation.
We recently published an article focused on the negative effects the NCA is having on the economy as a whole. However, when we look at the estate agency industry we must realize that it has many sub-sectors. For the purpose of this article, we will only discuss residential, as we believe that this sector is currently the greatest pressure.
So, is the doom and gloom projection and speculation for estate agents in the residential market due to the NCA and how much does the NCA impact on such a possible outcome?
Is the NCA going to bring the country to its knees?
Sunday, 15 July 2007
It has been a whole month and a half since the NCA has taken its’ full force and affect and the horror stories are starting to pour in.
I think that the whole picture of the NCA is not fully clear yet, but the effects have started to take shape.
Some comments, stories and situations have brought to the sad and hopefully wrong conclusion that the NCA has the full capability to bring the country down to its’ knees. Lets hope we are totally wrong.
