PROPERTY MARKET SENTIMENT
Category General News
"Residential property involves emotion. Sentiment always plays a significant role in decisions we make about buying, selling, renting and so on. We all know about that 'gut feel' we experience when we walk into a house, but sentiment begins before that. It begins with a sense of certainty, because the decision we take is about our future and how we visualize it.
During Covid - through all our lockdowns, easing of restrictions, tightening of others - the property market not only kept on ticking over, but particularly post various lockdowns, was buoyant. So buoyant, it took everybody by surprise, and although the extremely low interest rate played - and continues to play - a significant part in fueling the drive for home ownership, it was unexpected. Analysts talk about the market activity as being a result of the pent-up market, banks' willingness to lend, the low interest rate enabling tenants to become buyers, and other contributing international financial factors which have been providing a tailwind for our economy. Yes, there was, and is, uncertainty around Covid, but it was a global concern, and common to us all. There was some comfort in that.
The property market robustness hasn't disappeared, but it's settling at a more realistic level - a good, steady range of property transactions across all sectors of the market. The most affordable properties in all suburbs has been the liveliest sector, but pleasingly, there's been increased activity in the mid to upper market. Stock shortages are always a good indicator of demand, and it certainly puts upward pressure on prices. We've watched that play out across KZN.
So, what impact has the recent unrest had on the residential market? The short answer is, it's too soon to answer that. Uncertainty is never going to be a positive - sentiment and confidence has been knocked, and that could well have an effect on the property market. Certainly for those homeowners who've been considering moving south or emigrating, this could be the nudge they needed.
We urgently need government's help to know that this will not happen again. We need them to provide concrete, visible assurances, and if they do that soon, I believe confidence will return. Actions speak louder than words, and that is what we need now to snuff out the anxiety and uncertainty.
And what about safety and security? Again, a surprise.
South Africans stood up and were counted. People from all walks of life became true communities and neighbours, and it's that, more than anything else, which has lifted our spirits, made us feel a little stronger and safer, and given us some positive sentiment.
A knee-jerk reaction to This Perfect Storm was inevitable. If this storm is a one-off, it gives us - and hopefully, the government - an opportunity to regroup, rethink, and to pull diverse groups of people together for the common good. I do believe if we're given the certainty we need, see a host of bold, long overdue economic, labour and social reforms being implemented, we can make this work for us. We know how resilient South Africans are - they've just shown that in spades - we have all the ingredients, we now desperately need to see political will in action."
Author: Anne Schauffer
