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Innovation set to drive property sales

Feb 04 2013 15:07 Fin24
property

House price growth improves, but remains low.

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Cape Town - The property market will be in full swing in the next three years driven by innovative new offerings, said CEO of Korbitec Dawie Verryne.

Since the height of the global economic crisis, the property market has seen itself on a steady but slow road to recovery.  

However, Verryne said industry sluggishness has given key players a chance to rethink their strategies to cater to the altered economic climate.

The landscape of marketing and advertising is relocating itself into the online environment with an increase in consumers searching for property online.

This shift in house-hunting strategies gives consumers access to comprehensive reports, statistics and news, and is likely to trigger increased sales in the coming years, explained Verryne.

South Africa’s buying audience is also becoming increasingly informed with more buying options from financial institutions.

"Banks have already begun to experiment with alternative loan offerings, including pension-backed lending, and increasingly tailored loan arrangements for entrepreneurs," said Verryne.

"Pressure from the government to address the country’s housing crisis has also meant easier access to funding for those investing in entry-level housing, with bank and private sector partnerships emerging in order to address these political prerogatives," he added.

The low interest rates have cushioned households from the debt acquired during the recession but the next two years are likely to see interest rates gradually rising.

However, Verryne said: "Expert consensus suggests that interest rates should then drop, based on a traditional interest rate cycle, thus giving prospective buyers heightened levels of disposable income by 2016."

This will result in a spike in activity allowing a larger pool of previously cash-strapped individuals to access capital to enter the buyer’s market, he said.

While Verryne warned that labour unrest could weigh down investor confidence, he said that the increased focus on housing initiatives by the government and business hold promise for a full property market recovery.

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innovation  |  property
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