What Lies Ahead for the South African Property Market Post-Elections?
Category News
The dust has finally settled on one of the most important South African elections in recent memory, and it's now time for us to look ahead to see what's in store for both the property market and South Africa as a whole.
First and foremost, Western Cape residents had the most to be excited about. The Western Cape is widely regarded to be the best run province in the country, and with the incumbent provincial government retaining their position, all signs point to this trend continuing.
With service delivery now being a major factor for buyers, we should continue to see high rates of semigration to the province, which should increase demand, and have a positive effect on the local market.
However, things aren't looking bleak for the rest of South Africa. No political parties were able to secure a majority of the vote, and this stirred up talks of a coalition between the two most well supported parties in South Africa. International investors seemed to take an interest in this news, as the Rand strengthened against the Dollar as soon as it hit the headlines.
As we all know, no coalitions came to fruition, with the powers that be preferring to opt for a government of national unity instead. But, this didn't spell the end for the hopes of investors, as the Rand has continued to strengthen against the Dollar since the announcement.
Typically, the demand for property wanes in the lead up to an election, with most buyers employing a "wait-and-see" approach, and booms if a "market-friendly" result is achieved. But this has not been the case this time around.
The property market did not slow down noticeably in the lead up to the elections. And, a significant uptick in market activity doesn't seem far beyond the realm of possibility, as many South Africans seem to be optimistic about our new government structure.
If our new government can meet the expectations of South Africa, and we end up seeing real change with regards to load shedding, service delivery, and corruption, then the property market could look much more promising over the next five years.
And, now that the European Central Bank recently slashed it's interest rate, and the US Central Bank expected to do the same before the end of the year, which means that we could see an interest rate cut in South Africa before 2024 closes.
This could breathe even more life into the South African property market, but as always we'll need to wait and see what this change will bring.
Author: Seeff Atlantic Seaboard & City Bowl
