A property executive recently told UK visitors that March to June had seen his company's sales hit their lowest levels since 2005.

However, July to September showed an average 22% increase over the March to June period, with October and November showing a 42% upturn when compared to the earlier period.

What is more, says Mike Greeff, CEO of Greeff Properties, there are clear signs that the improved sales turnover will continue through the summer.

"I think that we are now into a scenario in which there is renewed confidence in property."

Greeff said that factors which, in his view, are underpinning this confidence are perceptions that:

- with five substantial parties in parliament our new democracy will be strengthened and the ruling party will be more vulnerable and sensitive to the people's real needs. This, among other things, will result in an intensified effort to increase delivery of low-cost housing.
- Eskom's problems now appear to be better contained and not as disastrous as originally feared.
- inflation, now close to 12%, is being brought under control and will be kept in check by lower oil prices and more efficient credit control (through the NCA and the banks' tightening up).
- as a corollary to this the public has come to terms with the National Credit Act (NCA) and are being forced to pick up a "save-first" attitude.
- the global financial crisis has affected SA far less than the First World countries.
- the Zimbabwe disaster, although serious, has not affected SA as much as some feared it would and a solution here is likely to be found within the next nine months.
- the international terrorism threat has not been a problem in SA. We do, said Greeff, have serious crime issues that need to be sorted out urgently, but these do not have as negative an impact as dedicated terrorism.

"Six months ago many people were looking at emigrating. With the rand at its current low levels, that is now discussed far less: We are instead seeing people getting on with their lives and again investing in property and many expats are coming back because of the world financial crisis and job losses. Some of these people have substantial funds which they are putting into property."

The upturn in property confidence particularly in the Southern Suburbs but also in Greater Cape Town, he said, has been helped by improved rentals on residential property which, he says, have risen by 10-15% this year.

Graham Leslie, MD of Greeff Properties, predicts that by late February the interest rate will have come down by 1% to 1,5%. This, he expects, will put the whole residential market onto a good wicket and will result in a slow, but steady, return to satisfactory trading in the third and fourth quarters of 2009.

www.property24.co.za

30/12/2008