Repo rate flat, but market still holding up well
The property market is still holding up well regardless of the fact that we have experienced some economic challenges. The Reserve Bank’s Monetary Policy Committee (MPC) decision to keep the repo rate at its current level was welcomed by analysts.
Repo rate flat, but market still holding up well
Despite the fact that we have experienced some economic challenges, the property market is still holding up well. Even though things are slower, there has still been price growth and several reasons to invest in property; with many locations seeing excellent trade, especially in the lower to mid-market sectors.
The Seeff Property Group welcomed the decision by the Reserve Bank’s Monetary Policy Committee (MPC) to retain the repo rate at the current level of 6,50% (base home loan rate of 10%). And as a result of the better than expected consumer inflation figure of 4.6% for June (lower than the market expectation of 4.8%), despite the weaker exchange rate, the decision to retain the repo rate at its current standing was very much expected by the market.
While experts in the are quick to highlight the downside of the market without necessarily weighing the balance, Manning says there is opportunity in every market. While downmarket conditions are usually characterised by speculators looking for bargains, it also brings serious buyers, but of course you need to know the difference, says Manning.
Several sellers are still making good deals as they adapt to the fluctuating conditions. They may not be seeing great profits, but they are still making money. When the sales side of the property market goes down and finances are squeezed, the rental side of the market tends to go up with more demand for rental property. While rates may be under pressure, landlords should be happy to know that they can still fill their units/homes and earn returns.
