Often viewed as a trendsetter in the South African property market, Cape Town continues to attract local and international interest.The year 2024 was marked by pivotal changes for South Africa, setting the stage for a cautiously optimistic 2025. It was perceived that a turning point had been reached, where the economy began to recover from years of stagnation.
John Loos, senior economist at FNB commercial property finance, said the developments were attributed to a combination of political, economic, and infrastructural improvements, which offered hope for a more favourable property market in the coming year.Declining interest rates and easing inflationary pressures had shaped economic trends in 2024.“By October, the Consumer Price Index (CPI) inflation rate had fallen to a remarkable 2.8%, the lowest seen in years. This downward trend prompted the South African Reserve Bank (Sarb) to initiate interest rate cuts, with two 25-basis-point reductions implemented by the year’s end.” These actions were viewed as improving economic conditions, both domestically and globally, as the international interest rate cycle also shifted downward. The formation of a government of national unity (GNU) was deemed investor-friendly, fostering a sense of stability and progress. Competitive elections further reinforced the idea that political accountability and reform were being prioritised. “These shifts were considered essential for addressing the long-term economic ‘super-cycle’ that had influenced the property market for over a decade.”Loos added the property sector, in particular, had felt the impact of economic stagnation over the past 10 to 15 years. “Data revealed that when adjusted for GDP inflation, All Property net operating income in 2023 was 11.8% lower than its peak in 2016. Similarly, capital values per square meter had declined by 21.7% over the same perio
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