2009/02/10

While January last year may have been the worst of times for the property industry, this January is proving to be the best of times for the Durban North market.

Durban North-based RE/MAX Panache reported a best-ever January month of R45m in sales.

Broker/owner Grant Gavin believes December's cut in interest rates and expectations of more and the drop in fuel prices may have anchored a still-to-be-proven market turnaround.

Gavin identified this week a definite easing from the negative sentiment that had permeated last year's business pointing out that Eskom's rolling blackouts, which had deeply shadowed purchasing decisions, had now worked its way through the system. Even the ominous number of emigration-driven listings had mellowed and more latterly been replaced by South Africans actually returning or enquiring to return home. His company's website has more than doubled in terms of UK-sourced property searches on local property.

Showhouse attendances, a telling benchmark of rising activity patterns, had reflected a 200% improvement year-on-year (y/y) in January from an average of two to three up to an average of six to seven with five houses attracting 12 visitors last Sunday. But the most positive aspect of the changing market for Gavin is the improvement in buyer sentiment. "People are out there and they want to buy now, which is a complete turnaround from early in the fourth quarter of last year."

But while buyers' resolve may have strengthened Gavin says the biggest challenge and stumbling block to buyers this year remains that of the banks wanting bigger deposits than at any time in the last five years. Under the old lending regime, before the National Credit Act (NCA) was introduced, his January sales, he believes, would have been substantially greater.

The agency's January sales of R45m consisted of 20 unit sales with a highest price of R3,6m for a La Lucia single dwelling and the lowest price of R820k for a one-bedroom apartment in Gateway. The sales figure, apart from representing the company's best ever January, was 214% higher than the same month of last year. The company's monthly sales average for last year was R33m.

Property24