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Emigration-motivated selling trend to slow for the first time since 2014

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The 4th Quarter 2017 FNB Estate Agent Survey pointed to a slight further rise in the estimated rate of emigration-related home selling, continuing a multi-year rising trend which started back in 2014.

Expressed as a percentage of total home selling, selling in order to emigrate reached its lowest level in the history of the survey (this survey question began in early-2008) back in the final quarter of 2013, at an estimated 2% of total home selling, while this motive for selling peaked prior to that low in 2008, at 20%.

The survey suggests that this motive for selling is arguably a good confidence indicator of middle to higher income households’ perception of the longer term economic and financial future of the country but does have a strong cyclical component ad evident in the numbers quoted above. The latest rise is, however, seen to have been driven by more than just economic performance.

“2017 saw widely publicized rating agency downgrades to so-called junk status, which were in part reflective of a lack of clear policy direction aimed at improving economic growth performance. Such actual or perceived policy uncertainty can raise concerns as to future economic opportunity in South Africa, and this can be an influence on emigration rates should offshore economic opportunities seem reasonable. Rand weakness in recent years, we believe, could have been a key factor too, making hard currencies that much more attractive for local highly skilled people to go and earn,” reads the survey.

Going into 2018 a possible reversal in this rising trend in emigration-related home selling is expected. The rand appears to reflect significantly improved sentiment and expectations among investors and a stronger rand can in turn also help to boost sentiment.

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