Homeowners remain downbeat

Johannesburg - Half of South Africa's home owners reckon that the housing market's declining price trend will persist to year-end.

This has become evident from new online research by ooba (formerly MortgageSA).

"The research shows that South Africans are divided as to the timing of a recovery in the property market, but they generally agree that it will happen some time this year," reports ooba chief executive Saul Geffen.

Twenty-nine percent believe the market will begin to stabilise by the end of the year and 19% think it could then improve.

The research indicates that people still believe there is value in property. About 39% indicated that they were holding on to their homes, while 31% said they were taking advantage of the buyer's market by buying bigger properties. At the same time 20% indicated that they were buying additional investment properties.

The encouraging news is that only 6% indicated they were leaving the housing market and 5% said they were scaling down to smaller homes because their bond payments were too high.

In order to meet their bond payments, South African consumers have had to dramatically alter their lifestyles, with 43% cutting down on luxuries to manage their payments.

Housing market experts reckon that weakening global economic conditions make any significant recovery in the demand for residential property increasingly unlikely this year.

Erwin Rode, a property valuer and economist at Rode & associates, says the housing market has not yet bottomed.

According to John Loos, property analyst at First National Bank's home loan division, there are still obstacles to be overcome this year, one of which is the oversupply of properties on the market.

- Sake24.com

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