Budget speech is hailed as ‘good news’ for the property market

SEEFF chairperson, Samuel Seeff has hailed finance minister, Pravin Gordhan’s 2014 “good news” budget as positive for the housing market.

“It was a positive budget given the current economic pressure; one that encourages economic and job growth, both vital factors for the property market.”

The focus on infrastructure development, he says, should also be seen as good news, not only for the vital upliftment and job creation, but for the focus on facilitating economic growth. In this vainthe youth wage subsidy too should be seen as positive to encourage skills development, hopefully with an entrepreneurial spin-off.

Seeff has also welcomed the tax relief measures for micro-enterprises as welcome news for small business and entrepreneurial growth; a sector seen as an important growth sector for the economy.

While the rise in the fuel levy will no doubt impact on households, the tax relief for lower and middle income earners is good news. This will put more money in the pockets of consumers and we would encourage especially bond holders to invest any savings into their bonds. Those still saving for a home, should take advantage of any potential savings to put towards their deposit or transaction costs, Seeff said.

“On the down-side, we are disappointed that there is no relief on property transaction costs and capital gains tax; both vital aspects in the market.

Transfer duty especially forms part of the costs associated with a property transaction and considering that all of these costs can equate up to 20% of the purchase price, this does remain an impeding factor, especially for the lower to middle end of the market.”

While no real fireworks yet, Seeff said the property market was in the healthiest position since the economic downturn, pre-2007/8.