Please note that you are using an outdated version of Internet Explorer which is not compatible with some elements of the site. We strongly urge you to update to a newer version for optimal browsing experience.

Responsible spending bodes well for home buyers

04 May 2015

It seems that middle-class South Africans are now at last beginning to cut back on the money and time spent on ‘frivolous’ items, particularly holidays, and that this is being done in order to balance their household budgets and to protect their prime asset: the property that they are paying off.

South African property is still affordable to a fairly wide cross-section of population, including young people, even though there is still a very large segment which at this stage has no hope of becoming property owners, says Clarke.

This is according to Tony Clarke, Managing Director of the Rawson Property Group, who says this has been established through discussions with many of the Rawson Property Group’s franchisees and agents.

“It is now clear that the reckless spending of yesteryear is being cut back, and South Africans are no longer quite as spendthrift as they were in the 2004 to 2009 boom era.”

Many of the younger generation had until 2009 never experienced a serious recession, and had ‘played the credit game’ recklessly, making maximum use of hire purchase, credit card and access bond facilities, he says. In the process many got seriously into debt, from which they are still struggling to emerge.

Now, Clarke says there appears to be a welcome return to a more responsible approach to household financing and the cut back on holidays, especially overseas holidays, augers well for the future.

“For the man-in-the-street, the 7% to 8% annual rise in property values makes property probably the best investment available, and it is one of the very few which can be done on borrowed (bank) capital.” 

Furthermore, he says it has to be pointed out that in contrast to many of the more successful European countries, South African property is still affordable to a fairly wide cross-section of the population, including young people, even though there is still a very large segment which at this stage has no hope of becoming property owners.

As recent spokesmen for the state have pointed out, Clarke says the consequences of people reaching middle age without owning their home and having to continue to pay rent puts a serious strain on any national economy’s budget.

It is therefore, essential, that home owning be fostered, he says.

Print Print
Top Articles
Savvy buyers can find great property options at lower prices in times of reduced confidence, and with signs of recovery and banks giving more bonds, it's a good time to buy...

While the commercial market may be slower than in recent years, it is by no means stagnating and demand in certain sectors continues to drive ongoing development.

Tourists are paying up to R4 400 per day in Cape Town’s mixed-use Waterfront and Foreshore, with visitor numbers expected to climb to 21 million by 2030. Read on...

Loading

Your browser is out of date!

It looks like you are using an outdated version of Internet Explorer.

If you are using Internet Explorer 8 or higher, please verify that your Internet Explorer compatibility view settings are not enabled.

For the best browsing experience, update to the latest Version of Internet Explorer or try out Google Chrome or Mozilla Firefox.


Please contact our Property24 Support Team for further assistance. Tel. +27 (0)861 111 724