Now is a great time to buy luxury homes in South Africa
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For years, the South African property market offered one of the best returns on investments for property owners. The market was robust and continuous demand helped property prices grow much faster than inflation and other financial benchmarks. However, as is the nature of markets, things have turned slightly, and the property market – especially the market for luxury homes – have cooled down in recent months. However, speaking to the property experts, 2020 is expected to bring better fortunes, making the current market a very attractive prospect for those with the capital to invest in property right now.
What happened to the South African property market in 2019?
Over the past couple of years, slow economic growth has had its effect on the property market. However, the effect of slow economic growth is often more pronounced in lower-priced properties, and less visible in the sales of luxury homes.
In fact, where it has been a seller’s market for years due to the exceptional growth within the market, things have changed significantly. Across the board, the market now clearly favours the buyer. Furthermore, instead of trends being consistent across the market, the market is currently showing two distinctly different trends. The low- to mid-market is still active, due to new buyers entering the market, keeping up the demand. However, at the opposite end of the market, luxury homes are moving much slower than just three years ago.
So, why are luxury homes selling at a much slower pace?
It is an expected trend that property sales slow down in the lead up to an election, as was the case in South Africa in 2019. Optimism was plentiful that the market would pick up steam after the elections. What actually happened, however, was a sustained damper on the market, especially in the luxury homes category. This was caused by a conglomeration of factors, including continued political uncertainty, sustained poor economic growth, and concerns regarding property ownership.
Those with the funds available to buy luxury homes generally chose to ride out the uncertainty and wait before committing to a purchase.
What are the property trends expected for 2020?
Experts are expecting a positive trajectory for the property market in 2020. Because of the slow down of the market in 2019, many properties – and specifically luxury homes which were selling at a premium rate – were left on the market for much longer than is usually experienced in the South African property market. Those who were looking to sell quickly, whether out of necessity, wanting access to capital, relocation, and more, dropped their asking price, leading to properties selling at absolute bargain rates. In addition, the interest rate is also coming down, which further serves to stimulate the property market.
All of these factors together make this a great time to buy luxury homes
This perfect mix of trends and events have led to a very attractive market for property buyers. South Africa has a tremendous selection of upmarket properties and luxury homes available, which under any circumstances offer the buyer a great deal. Now, with access to funding becoming easier, combined with a slew of properties that are available at absolutely bargain prices, the time is perfect for those looking to acquire either a dream home or an investment property with the potential to deliver exceptional returns.
Trust the market leader in buying and selling luxury homes
If you are interested in investing in the premium side of the property market in South Africa, start by contacting Fine & Country South Africa. As a leading global property agent, we have the expertise to guide you through the process quickly and effortlessly. We also have a great selection of luxury homes across the country on our books, so finding the perfect property for you will be a breeze.