In spite of the aggressive rate hiking by the Reserve Bank since November last year, both housing demand and the availability of bond finance have so far remained strong – but deposit percentages are now rising, and buyers are extremely price conscious, says Gerhard Kotzé, managing director of RealNet.
This means that most buyers once again need to have a considerable amount of cash available to finalise a purchase. And because it is difficult for them to save in a climate of high inflation and rising rates, they are really focused on finding the best value for money. “Now, though, most households have a very different financial perspective, and home buyers have become much more inclined to make offers based on their own perceptions of value for money and potential growth, even if these are well below sellers’ asking prices.”
“The result is that more properties are getting ‘stuck’ on the market until their owners drop their asking price – as evidenced by the fact that the average listing time has risen by almost two weeks since the start of the year and that the average differential between the initial asking price and eventual selling price is also going up steadily.”