There is no doubt that 2018 was a very challenging year for both the economy and the property market. As 2019 is in full swing, you can’t help but wonder what challenges this year will hold for both the economy and the property market. In 2018, it was mainly business as usual, however, it is important to note that the demand for properties between the 3-million and 5-million mark decreased through the year. Reasons for this could have been the weak economy, political uncertainty and land ownership concerns.
So, what will the market have in store for home buyers/sellers in 2019?
It is argued that the market will most likely remain flat during the first few months of 2019. The reason being that we are heading towards the May elections, and this could be a turbulent period in 2019. In terms of the economy, there is a feeling of positivity in the air as the economy is expected to start lifting in the middle of 2019. The feeling of positivity can be attributed to the fact that the rating agencies have kept a stable outlook and President Ramaphosa has shown his commitment to eradicating corruption within the government.
It’s important to note that the final quarter of 2018 also had an impact on the economy and the property market for 2019. The festive season has come and gone, and as can be expected, many consumers found themselves indulging in the festivities and overspending. This has impacted many South African households’ finances, as there is now an increased pressure to meet monthly commitments in terms of housing bonds and rents. This should only have an impact on the economy and the property market in the early part of 2019.
It is also expected that the interest rate will go up with 2% over the next 18 to 24 months. This will, without a doubt, put even more pressure on household finances, in terms of higher bond and credit repayments, as well as cost hikes. This will have a huge impact on affordability.
If you are planning on buying or selling property in 2019, it’s important to keep price expectations realistic. Buyers should also strike while the iron is hot and not wait for too long, as all economies and property markets are subject to ups and downs. In conclusion, 2019 is the perfect year to buy property. Ensure that you do your research and make well-informed decisions when it comes to the property you want to buy, as well as the purchase price of the said property.
This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice. Errors and omissions excepted (E&OE)