Why Buying and Selling Property Now is a Good Idea...
Category News
It is well-known that 2019 was a difficult year for South Africa's economy and politics, coupled with the 2020 coronavirus lockdown on the property market through levels 4 & 5, one might expect a very pessimistic outlook for our residential property market.
However, here are some factors which indicate that buying and selling your property now might just be a good idea.
Lower Interest Rates
2020 has seen three big rate cuts in 3 months (1% in March, 1% in April 2020, 0,5% in May) with the prime rate now at 7.25%, its lowest level since 1973.
Buyers will have less difficulty in qualifying for a home loan and will receive more favourable interest rates on their loan. It means that they can afford to pay more, can get bigger bonds and can then compete in a higher price bracket.
For sellers, this means greater buyer interest and a higher likelihood of an easy sale.
Buyers Market
This is our market currently with the abundance of properties for sale. It's predicted that this is how it will be for most of 2020 while the market continues to rectify the plethora of properties, as well as stabilize our country's economic challenges.
Buyers will be spoilt for choice, will become more knowledgeable property, what's available, fair pricing and will become more selective as they get to "view" more and more properties.
Sellers will benefit from a heightened interest and increased "viewings" of their listed properties.
Realistic Prices
In a buyer's market, prospective sellers will have to be more realistic about the value of their properties in this current market. If the price is too high, the property may sit and buyer demand will decrease, then their property will be priced out of the market.
Banks
Banks are being more lenient when granting bonds and in October 2019, BusinessTech had already reported that "The banking industry continues to show confidence in South Africa's property market by further relaxing their lending criteria and approving home loan finance at levels last seen 12 years ago".
If qualifying for a home loan is easier and buyers receive better interest rates, then this may encourage the younger generation to buy for the first time, or encourage those people wanting to upscale to sell their existing property and buy a better property.
For sellers, this could also mean greater buyer interest and a higher likelihood of an easy sale.
First Time Homebuyers
With lower interest rates and banks being more lenient in granting home loans, the younger population are opting to buy now instead of later as this has suddenly become more affordable for them.
Also, the government programme FLISP (Finance Linked Individual Subsidy Programme) makes buying a home a real prospect for low-income earners (i.e. a SA citizen over 18 years of age, who is either married, cohabiting or single with at least one dependant, who earns between R3,501 and R22,000 per month and who must have already have a home loan approved by the bank). FLISP is a subsidy to assist in buying a home and does not need to be paid back.
These are pleasing incentives for both buyer and seller, especially for a buyer who does not need to sell a property.
Transfer Duty
For properties below R1m, Transfer Duty is no longer applicable. This is attracting an influx of first-time buyers into the property market.
It's Winter
Traditionally house prices are seen to be higher in spring and summer so this could be the ideal season for both buyers and sellers.
Realistic property prices, the lower rate of interest and the leniency of banks in granting home loans are all indicators that now is an ideal time for both buyers and sellers of property.
Don't miss out! Join the rush! Now is the time to explore the property market for yourself. For more information chat to one of our experienced and professional real estate agents.
To contact us, follow the link: https://www.homesofdistinction.co.za/
To contact one of our Real Estate Agents, follow the link: https://www.homesofdistinction.co.za/agents/
Author: Lv Digital
