Property sector expected to rebound post-elections
Global markets demonstrate an uncertainty-driven slowdown in the months preceding a general election, says High Street Auctions director Greg Dart.
The last piece of privately-owned land in Svalbard archipelago in the Arctic is up for grabs. Picture: iStock
The uncertainty in South Africa’s property market before the general election was not a cause for concern, according to High Street Auctions director Greg Dart.
Dart says pre-poll economic jitters are a common thread of elections worldwide. He says there’s a rhythm to election cycles well known to the global property sector, and to which it adapts.
“As an investor, if you understand the cycle, it becomes less disconcerting,” he says.
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Dart says global markets in most parts of the world demonstrate an uncertainty-driven slowdown in the months preceding a general election.
These jitters can start as early as a year before polling, and are marked by:
Reduced property transactions
Typically, the period leading up to elections is marked by uncertainty, causing potential buyers and sellers to adopt a wait-and-see approach. This often results in a slowdown in real estate transactions.
Property price stability or mild decline
Due to reduced market activity, property prices may stabilise or experience a slight decline as demand wanes.
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Investor caution
Investors might delay significant decisions or new projects due to potential changes in policies that could affect property taxes, regulations, and economic stability.
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Dart says in most instances, regardless of the outcome of an election, over a period of months the real estate market will adapt and then recover in accordance with the new political realities.
Global trends indicate the most likely performance-related changes to be:
Property market rebound
Following the resolution of political uncertainty, the real estate market often experiences a rebound. Transactions may increase as buyers and sellers who were previously hesitant, enter the market.
Policy Impact
The specifics of the election outcome, particularly changes in government policies affecting the economy, taxation, and real estate regulations, can impact market trends.
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