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IT'S AWAITING GAME SO DON'T SPRINT FOR SALE
Category Property News
Homeowners looking to sell their properties this year should not be scared off by the current state of the property market. Even though the market is still in favor of buyers, there are many situations where sellers can still get their asking prices. Seller circumstances are "so individual" and South Africa's political and socio economic environment "so unsettled" that Paul Stevens, chief executive of Just Property, says it is dangerous to make blanket judgments. Rather, homeowners wanting, or needing, to sell should look at deed's office data for sales trends in their areas. This will tell them whether properties in their areas are achieving good sales prices or if there is a downward slide. Stevens is also optimistic the market will start to turn in favor of sellers in the second half of the year.
Even now, however, there is still a strong demand for primary homes, says Tim Greeff, a regional sales director for Greeff Christie's International Real Estate. There is also a "situational demand" as many homeowners looking to buy new properties will need to sell their current homes. While the market is dependent on macro-economic factors such as Eskom and a potential Moody's downgrade, people "always need to buy and sell".
"Demand needs to catch up with the supply and right now there is more supply. It needs to balance out." When this turn will occur is "pure speculation", says Lew Geffen, chairperson of Lew Geffen Sotheby's International Realty However, he notes: "You sell low, you buy low, so upgraders will not lose anything by selling. In fact, when the market turns, the proportional value gained by upgrading will be greater than if you did not upgrade at all."
Although the urgency to sell depends on individual sellers' situations, those who are able to wait before listing their proper ties should do so, advises Grahame Diedericks, manager principal for Lew Geffen Sotheby's International Realty in Midrand. Those who cannot wait need to be realistic about how much the market is willing to spend and align their asking prices with that level. "Properties listing at the correct price in this market are moving, but buyers are savvy regarding values and are not willing to over pay, especially considering the amount of choice they have at the moment." Amid the gloom of the buyer's market, sellers should remember it is not necessarily all bad news for them. After all, the better position buyers are in to purchase a home, the better seller's chances are of finding credible buyers.
Bond approval rates have risen, and lending criteria appears to be slacking, says Stevens. This makes property finance more widely available to people. Offering advice to current or soon to be sellers, Greeff says the first offer they receive on their property "is always your best offer". However, he adds: "Always have a reputable agent at your side to negotiate for you. Your property needs to be priced realistically."
It is also "vital" that sellers understand the market nuances in the particular area in which they live, says Claude McKirby of Lew Geffen Sotheby's. "Only an agent who knows and understands the market conditions will be able to help you make an informed decision." He says agents should make sellers aware of their property's competition in their own suburb as well as neighboring or sur rounding suburbs, as well as recent selling prices of comparable properties in the area.
Craig Mott, a regional sales manager for the Rawson Property Group offers the following advice for sellers: Get your property market ready. First impressions are important. Get advice from a trusted real estate agent to help narrow down a few key areas around the home that should be updated or fixed. Once you've found the right agent, look over their mandate agreement and make sure you're comfortable with their marketing approach, cancellation policies and time lines.
Sole mandates are highly recommended for the best sales experience and results. Wonderful opportunities for first time buyers "IT IS the best time in the history of South Africa for newcomers to buy property as the market is at rock bottom. I don't believe it can drop further." This is according to Lew Geffen of Lew Geffen Sotheby's International Realty, who says banks are "throwing money at the problem". "Finance is readily available and if investors don't take the opportunity now, they will regret it in three years' time."
This does not mean, however, that buyers should rush the process, says the agency's Arnold Maritz. "Buyers are spoiled for choice in terms of properties for sale, so take your time to access and analyze the market with the assistance of a knowledgeable and professional property consultant. "A buyer's market is an excellent time to invest, so it would be wise to look carefully for the best value for money, and always buy in the best area and position you can afford."
The current market presents a "wonderful opportunity" for first time buyers and investors alike, says Just Property's Paul Stevens. Sellers could still achieve their asking prices in the current slow market. "There is a good chance you'll come across an opportunity you would not otherwise get in a seller's market. Get yourself in a position to buy by getting pre-qualified for a mortgage bond. Once you know what you can afford, and you have a certificate proving you can get finance, you'll be in a strong position to make an offer and be a more attractive buyer."
Greeff Christie's International Real Estate's Tim Greeff agrees: "Get into the market as soon as possible as the banks are quite lenient. If you have a deposit saved up, that is even better. Banks are lending up to 105% at R1.8 million and up to 100% at R5m." Buyers must, however "buy smart", says Lew Geffen Sotheby's Grahame Diedericks. They should invest in metro areas as, although the yields will be "stagnant" for some time, buying the right spec and location "will hold the buyer in good stead when the market eventually turns".
Developing metros such as Fourways, Midrand, and Sandton CBD are good areas to buy in, he believes. Other buying advice from Just Property's Pieter Janse van Rensburg includes: Do the necessary research regarding the policy of pets when purchasing property in a complex. Ensure your credit profile is good with regards to the approval of the mortgage loan. Consider the hidden costs. Research the market to avoid costly mistakes. Rules of body corporates and other associations should be studied to prevent uncomfortable and awkward situations
Author: Lew Geffen Sotheby's International Realty