There was never a better time to purchase property than right now, says Mike Greeff, CEO of Greeff Christie’s International Real Estate. The conditions are favourable and according to BetterBond, there has been a significant uptick in home loan approvals, making it the ideal time for potential buyers to purchase, especially first-time buyers.
Furthermore, the interest rates are the lowest they have ever been in 50 years, transfer duties do not apply for homes that are R1 million or less, there is an oversupply of new builds and banks are competing for business. Bearing all this in mind, it is safe to conclude that it is, in fact, a buyers’ market.
Uptick in conditions
- As mentioned, if you are purchasing a property for R1 million or less, you will be exempt from transfer duty. This is especially advantageous for first-time buyers.
- Buyers who are wanting to purchase for more than R1 million will also get some relief. For example, a consumer who purchases a house valued at R2.5 million would have a saving of R17 000 in transfer fees.
Interest and lending rates:
- Due to COVID-19, we have experienced four major repo rate cuts this year. As a result, the interest rate of 3.75% is the lowest it has been for the past 50 years.
- The repo rate cuts have led to the prime lending rate being favourably low at 7.25% which means that as a buyer, you will be getting ‘’more credit for your affordability’’. Liz Botha, Home Loan Specialist at BetterBond explains that ‘’because the lending rate is so low, you will be able to qualify for more credit with the same salary and your repayments will be significantly lower’’.
If you are looking to purchase property, whether it be for the first time or if you’re building your portfolio, it’s imperative that you are aware of how to navigate this current market. With the economy being the way it is, due to COVID-19, buyers and sellers alike are weary of making any big financial decisions, however, it’s essential to ‘’strike while the iron is hot’’ and if you have a competent and highly-skilled agent on your side, you can rest assured that you are in good hands.
Purchasing property in a buyers’ market should be a walk in the park, however, it does not come without its challenges, says Greeff. One of the main advantages of buying in this market is the fact that you are spoiled for choice and now, you have just a little bit more time to do your homework and find just what it is that you are looking for. But it’s important to note that although it is a buyers’ market and you have a bit more negotiating power, an attractive home at a fair market-related price, will always attract offers so the competition is still fairly stiff.
What does a buyers’ market mean for sellers?
Selling your home during a buyers’ market needn’t be a negative experience. If you are armed with a well-trained agent, market-related pricing, and excellent marketing, selling your home should be a breeze.
It’s important your property stand out of the crowd. Ensuring that your home is priced well and that it is being marketed to its full potential is essential, but so is excellent photography, engaging descriptions, and successful show houses (whether it be physical viewings or a virtual walk-through). This is where a reputable agency is your strongest asset as they can ensure that you get the full package and that your property is given the best possible chance at being sold.
In challenging market conditions, the agent you choose can make all the difference to your sale. When choosing your agent, use a comparative market analysis to ensure that the recommended figures i.e. listing price, your agent is providing you with can be backed up.
Selling in the time of COVID-19
- If you are thinking of listing your home, do not hesitate. With many South Africans having more time on their hands due to lockdown, there has been an increase in online browsing.
- Some people are realising that their current homes no longer suit their current needs, while some may have decided that they no longer wish to rent. With COVID-19 being rife within in South Africa, many are adjusting their living situations and what they are looking for, may be what you have to offer.
- The COVID-19 pandemic is constantly changing and evolving. The best thing sellers can do is to partner with an agent who has the backing of a well-established brand and a network of referrals that can be taken advantage of.
If you are in a position to buy a home, now is the time to do so. There is pride in home ownership and buying a home is one of the best financial investments you can make. Everything is working in your favour, as a buy, and there is no better time like the present.