Lew Geffen Sotheby’s International Realty Chairman Lew Geffen says while the MPC announcement on 18 July, 2024, of an unchanged repo rate is disappointing, the decision is realistic in light of the Consumer Price Index still coming in above the SA Reserve Bank’s target range.
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“While this leaves the prime rate at its highest level in 15 years, the outlook is far from negative.
“National and global investor sentiment has changed dramatically since the ratification of the Government of National Unity (GNU). Although it’s early days, we’re already seeing a level of positivity regarding South Africa’s future economic prospects that has been lacking for at least a decade.
“The Liberty Bell has rung, in my opinion, and we’ll continue to see the effects in the months and years to come.”
Geffen says the property market has already sparked in reaction to the GNU.
“In the past month, Gauteng has got the biggest shot in the arm, with the number of sales in areas such as Randburg, in particular, blowing up.
Around the R2 million mark
“There’s suddenly huge appetite for properties around the R2 million mark, and the feedback we’re getting is that these buyers have been waiting to see what would happen with the election. Now they’re diving in with alacrity.
“For the most part the national market needs to recover by at least 20% just to make up the ground it’s lost in the past couple of years.
“That movement has already started, and it’ll take off like a rocket when we do see an interest rate cut, which should be in September. And if the economists are right, the MPC will gift us with two 25 basis points cuts before the end of the year, closing out 2024 with a repo rate of 7.75%.
“With the market set to turn so dramatically before the end of the year, what this means for buyers is that they’ve either got to catch the first ship, or spend a lot more getting on the last.
“Prices are going up. Now is the time to buy!”
