In an optimistic outlook for the year ahead, Byron Thomas, the founder and CEO of Byron Thomas Properties, foresees 2024 as a promising period for the property market in South Africa.
After facing challenges in recent years, akin to a tide turning, the property market is poised for a positive shift, he says.
Several high-impact factors are expected to shape the property landscape in 2024.
1. Declining Interest Rates
Forecasts indicate a decline in interest rates starting from the first quarter of 2024, extending into the coming year. This downward trend is anticipated to foster positive buyer sentiment, attracting more individuals into the market, according to Thomas.
The shift from the negative buyer sentiment of previous years, attributed to rising interest rates and affordability issues, is expected to drive a resurgence of investor buyers as well, he said.
With easing interest rates, many first-time buyers who have hesitated to enter the market are now expected to afford properties.
The decline in interest rates is seen as a catalyst for these buyers to gain the confidence to purchase homes rather than continue renting, said Thomas.
This shift is anticipated to alleviate the negative impact on demand, particularly affecting the pricing of sectional title units.
3. Geopolitical Landscape
Despite global turmoil, South Africa's internal issues are becoming less of a deterrent, leading to a slowdown in emigration and semigration movements.
Notably, there is a reverse trend, with buyers returning to South Africa. Joburg, as the financial hub, is gaining prominence, especially around Rosebank, due to its proximity to business nodes, schools, hospitals, and major transport routes, said the property expert.
4. South African Elections
While election outcomes are uncertain, early indicators suggest a decline in support for the ruling party (ANC) in the 2024 National election.
This potential shift signals a desire for positive change from both voters and the private sector. The impact of coalition dynamics remains complex, but there is a prevailing optimism for a positive future, according to Thomas.
5. Infrastructure Developments
Numerous suburbs are undergoing short-term challenges for long-term gains, with ongoing infrastructure upgrades.
Homeowners are investing in backup power solutions, boreholes, and water storage to reduce reliance on municipal services, contributing to a more resilient living environment.
6. Decreasing Stock Levels
Listing numbers in certain areas have decreased, signaling a potential shift towards a seller's market. As stock levels decline, property prices are expected to benefit from increased demand, said Thomas.
7. Value for Money and Quality of Life
Thomas pointed out that Johannesburg's property prices are currently at an affordable level, offering excellent value for money and a unique lifestyle.
Community and security initiatives, along with resident participation, are making suburbs safer and more desirable.
In Summary
The outlook for 2024 is optimistic, with positive shifts expected in both freehold and sectional title segments of the property market.
The timing for prospective buyers is crucial, as property prices are projected to climb with decreasing stock levels and favorable interest rates, noted Thomas.
Those prepared to take the leap early may reap the rewards in this evolving real estate landscape, he said.
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