22 Dec 2010
While the levels of optimism in the property market remained prior to the 2010 World Cup, these quickly declined after the post-match euphoria and returned to more sombre levels claims Rael Levitt of Auction Alliance.
In his review of the property market for the year, Levitt says that constrained bank funding, a drop in property trading and a fall in house prices contributed to the lack-lustre performance of the market.
Despite these factors, Auction Alliance ended the year 22% better than budget, selling properties and assets worth R5,2-billion and recorded some of the highest-value transactions ever bought at auction.
“Buyers with access to capital have been out in full force finding low-value deals and these speculators have been able to make some serious money this year,” he says.
“Throughout the year, distress levels continued among owners of vacant land, property developers with incomplete developments or golfing estates,” he says.
“It will take years for this market to reach stability, clear out the distressed inventory and start to show signs of positive growth once again,” Levitt says.
“We have seen banks, liquidators and legal entities selling record numbers of assets on auction and property speculators have streamed back into the market,” he adds.
Levitt claims the World Cup had a negligible impact on the property market. This year property worth just under R10-billion a month was sold in South Africa and analysts expect sales levels to fall further in the coming year.
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Paddy HartdegenFreelance columnist at property24.com.
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