THE Chairman of Seeff, Samuel Seeff, has advised homeowners who are not critically pushed to sell, to take their properties off the market for the next few months.
He has advised sellers to be cautious as well as patient so that they can wait out the storms and re-enter the property market when it is again on the up.
“Current indicators, a conservative but encouraging national budget, some stability within the stock market and hints that the Eskom power crisis can be managed positively, suggest that this might be a lot sooner than many think.
“Sentiment, especially negative sentiment, tends to have a significant effect on the property market,” according to Seeff.
“That is why massive hikes in interest rates, flagging business confidence, ever escalating prices and skills shortages that could threaten the country’s economic well-being, make it look as if all is gloom and doom.”
Seeff recognised the reality that the South African property market was at its most negative spot for the last ten years, saying “we’ve seen a major downward turn in the last three months.”
“Because many property owners have had to put their homes on the market due to financial constraints and because more and more people are opting to leave the country, there is a great deal of stock on the market,” he explained.
“This not only tends to put downward pressure on prices, but also increases the competition in the marketplace.”
Seeff said that on the flip side, buyers who are also feeling the pinch and still carefully negotiating new credit legislation, have to be more cautious.
“Many also feel the time is ripe for a bargain. At first sight, this is a no win situation. Sellers have last year’s expectations and buyers are now sitting with this year’s sentiment,” Seeff pointed out.
However, this is where the negatives end. Seeff is confident that the residential property market is close to bottoming out and that some recovery may even be evident by the second half of the year.
He also believes that the current negative sentiment that is gripping South Africa will begin to dissipate very shortly.
“Of course, at the end of the day, everything hinges on the interest rate environment and economic growth.”
Together with a number of economists, Seeff believes this country needs not brace itself for a recession.
“Consumer spending has slowed and, even though inflation is not within target and your average consumer has no control over escalating petrol, energy and food prices, the Reserve Bank should now elect to maintain interest rates at current levels.”
Seeff’s prognosis is that interest rates could even begin to decline by the last quarter.
