Semigration Enhances Property Activity
Category Newsletter: Article 2
One of the first questions we as an estate agency are asked is “how is the market doing?”. Timothy Johnson Sales and Marketing Director offers his opinion
“One of the biggest lowlights this year was in April, when President Zuma dismissed the widely respected Finance Minister Pravin Gordhan. This not surprisingly led to the country's credit rating being cut to junk status. Investor sentiment took a big hit. In August, Zuma also managed to survive his eighth motion of no-confidence. This affected the property business in the middle part of the year and our office in particular experienced two of our slowest months of trading in our 8 year existence. Sentiment plays a big part in investment, and it was clear that many people were simply waiting to see what happened before pulling the trigger.
However the “National Resilience Gene” worked its magic as South Africans shook themselves off and realised, as they always do after events like the downgrade and other recent political tensions, that life goes on and there is a lot of opportunity waiting to be taken advantage of. We saw this in our business and in October and November we saw a complete turnaround with sales figures breaking all our previous monthly records.
Approximately 60 to 70 percent of our buyers are from Gauteng, semi-grating to the coast. The remainder is mainly those relocating from the greater Durban area to the North Coast as well as some overseas buyers, who account for less than 10 percent of the total. These are often expatriates returning to South Africa or acquiring an investment closer to home while they are based abroad, or acquiring homes for holidays in the interim and potential relocation on retirement in the future. Semigration - people moving from one part of the country to another in search of a better quality of life. Recent figures show that the major coastal metro housing market in Durban continued to outperform the interior metro markets in early-2017, with growth of 6.7%. This is exceptionally interesting if we consider that FocusEconomics panellists expect the economy to grow 1.3% in 2018 and 1.8% in 2019.
With all this said, we can be thankful to live and work on the Dolphin Coast. Demand for our North Coast properties is driven by our area’s convenient location, infrastructure and long-term investment potential and is being fuelled by both local buyers and upcountry investors as well as some foreign interest. The lifestyle is highly sought after with our idyllic year-round climate, the development of excellent schools, another of which Reddam House is also opening in Ballito next year as well as the continued launch of Lifestyle estates and continued upgrading of existing estates. Retirement options are also being added and this proliferation of choice options is highly appealing to the out of town Buyers as well as relocating KZN clientele.
The future looks very bright with the demand for North Coast products and lifestyle continuing to grow. We are very excited about 2018 and look forward to seeing what our local property market has in store. Have a wonderful Festive Period and a very happy New Year’s celebration.
Author: Tim Johnson