How the budget speech could impact your Cape Town property
Category Property news
How the budget speech could impact your Cape Town property?
Tito Mboweni, the South African Minister of finance, will have the unenviable job of presenting the South African budget speech later this month which will outline the country's current financial position.
Ryan Greeff, Director at Greeff Christie's International Real Estate - City Bowl, Northern Suburbs, Atlantic & Western Seaboard, says that "many economic commentators have taken to the news networks to share their wisdom on the highly anticipated event."
On the ground, we are currently seeing large investments, particularly in the new development space being held back until there is more certainty around Government's financial policies for the next 12 months as well as the impact certain financial decisions may have on the property market moving forward."
Marthinus Botha, Greeff Christie's International Real Estate - City Bowl, Northern Suburbs, Atlantic & Western Seaboard area Managing Director explains that "the Cape Town property market has entered 2021 relatively similar to the way it ended 2020 which has been an encouraging sign. Particularly for the sectional title property market between ZAR 3 Million and ZAR 1 Million and full title between ZAR 4.5 Million and ZAR 2.5 Million.
Rentals in Cape Town remain under pressure due to the significant oversupply, however, investors have had some relief due to low-interest rates. New investors entering the market still remain fairly subdued as a result of low yields and the opportunity cost of investing in SA.
In the commercial property space, we are slowly starting to see a rebirth of new start-up companies particularly in industries that have been hit the hardest by lockdown measures such as tourism and hospitality. This will hopefully help bridge the large unemployment gap that the country is currently facing, especially with employee relief in the form of TERS having come to an end at the end of last year."
Taariq Saban, Commercial Broker at Greeff Christie's International Real Estate mentions that, "key flags to look out for in the budget speech next week will be increased taxes which could have a major impact on household income which in turn affects affordability; the ability for Government to provide relief and stimulus measures akin to other emerging market countries that fall under BRICKS to combat the adverse financial effects of lockdown measures to create much-needed support to keep business afloat as the economy recovers; as well as, the transfer duty thresholds and inflation figures which directly impact the property market at large."
We will be sure to send in-depth commentary on the budget speech as it relates to the property market next week.
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Author: Greeff Christies International Real Estate
