The housing market is a reflective market place. The demand for homes to buy or to sell reflects the confidence levels of sellers and buyers. To commit Rx per month to a 20-year mortgage loan you must feel confident of your earnings each month for the medium to long term. Homeowners feeling uncertain whether or not their major investment is likely to increase in value, in real terms, are more likely to attempt to sell their homes and perhaps opt for renting a home in uncertain times.
Having the hindsight of a 44-year career in the property industry, veteran property economist Neville Berkowitz, feels that the time to buy a home is soon approaching. He states that if there is a Ramaphosa victory as the next President of South Africa, the country will see a surge of positive sentiment and an improved confidence level. The housing market will reflect that in improving demand and hopefully improving price levels of homes.
“For those of us who have lived through the Soweto Riots in 1976, The Rubicon Speech of the middle 1980’s, the Codesa period of the early 1990’s, The Emerging Market Crises of late 1990’s and the 2008 Great Recession, today’s Zuma/Gupta created collapse in confidence is likely to be reversed, in part, by a Ramaphosa victory as President, initially of the ANC, which could come as soon as 8th August or December 2017 and then as President of South Africa in 2019,” says Berkowitz.
“Never forget that this is a man, who together with the National Party’s Roelf Meyer, steered South Africa away from the abyss in the early 1990’s and created the “New South Africa” under Nelson Mandela’s stewardship”, recalls Berkowitz, who founded low commission estate agency, HomeBid, in 2015.
The graph below of business confidence from the RMB/BER in Stellenbosch shows how we survived these ominous times and returned to upswings in confidence and economic growth.
Cyril Ramaphosa is a self-made billionare and he has chaired some of South Africa’s largest businesses. As a businessman and former trade union leader, Berkowitz believes that he is aware of what the economy needs to meaningfully increase investment and ultimately job creation.