Property market continues to suffer decreased sentiment

The property market is normally a pretty happy place in South Africa, but if you are currently ready to list property for sale in Vryheid, it will come as a bit of a downer that sentiment is once again down in the second quarter of 2018.

This news comes after the results of ABSA’s Homeowner Sentiment Index (HSI) were released, and showed that the sample of consumers used remained a little less positive across all sectors of the residential property market.

The national feel dropped by 2% in the second quarter, with positive sentiment being at 73%. This was not good news, especially as that overall number has dropped by over 10% since the last quarter of 2017.

There were some positive aspects that came out of the survey, with many of the consumers still having trust in property being a secure asset, while there was also strong belief in the fact that properties would still increase in value. Negativity still remained around the recent political uncertainty, and despite there being some clarity on the land reform issue, it also continued to sow seeds of concern in the market.

When drilling down into the specifics, the sentiment around buying property dropped to 61%, but despite this the larger portion of participants were still optimistic about entering into the market as they felt that there were some good prices to take advantage of currently.

Selling property continued to see positive sentiment of under 50%, with it dropping further to 43%. The discussions around land expropriation without compensation continued to hurt this sector, even though many people still want to own property.

Unfortunately, there is an expectation that this trend will continue for the rest of the year, with tough financial circumstances also adding pressure to the market.