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Looking to buy upwards? The time might be now

‘Bigger properties are taking the bigger discounts’: Berry Everitt, CEO at Chaz Everitt International Property Group.

The original headline of this podcast was inaccurately titled ‘Residential property market expected to plummet this year’. We apologise for this oversight.

 

NOMPU SIZIBA: It’s our property feature, and today we take a look at the expectations for the residential market in 2021. Improvements were seen in some parts of the market last year, particularly the sub-R1 million level of the market, as buyers took advantage of the relatively lower house prices and low interest-rate environment. But, as the virus continues to wreak havoc and the national lockdown tightens, what are the prospects going forward? Well, to give us his take on things I’m joined on the line by Berry Everitt, CEO at Chaz Everitt International Property Group.

Thank you so much for joining us, Berry. Now, before we focus on 2021, just give us a quick synopsis of what happened in 2020.

BERRY EVERITT: Well, 2020 was an incredible year for all the wrong reasons. But we ended very, very strong in the last six months of the year. It was almost as if it was just a blip on the radar in terms of the results that our company produced. In fact, the move with the technology and the digitisation of our business to move onto our platform allowed us to communicate well with the customers. And it really changed the way we could deal with our customers. When there’s a lockdown like you had on March 27, what do you do? What you can do is reach out and try to assist each other, because it becomes something really scary for many of the clients that we had and for many of our agents. So it’s just about being human.

NOMPU SIZIBA: Fast forward to now, to 2021. It has kicked off with a terrible bang – increased infections and deaths, tighter lockdown regulations and a continued feeling of uncertainty for the economy and jobs. In this context, how do you see the various components of the residential market playing out?

BERRY EVERITT: I don’t have a crystal ball, but we do think that the momentum from the lockdown last year will start losing some of its steam and, although inflation remains low and interest rates are expected to remain low right through to 2022, still there are so many job losses and such an effect from what you’ve just mentioned. And when the perception in the market is one-half uncertainty, no markets do well. So that’s where we are right now.

NOMPU SIZIBA: Just speaking to what you’re saying there, what does this then mean for the approach of the banks? Can we expect them to become more risk-averse as well because, like you say, there’s so much happening? Not much has improved from last year.

BERRY EVERITT:

Well, let’s firstly say it’s not all doom and gloom from a property-market perspective.

Every one of the first-time home buyers that we had last year – about 64% of our buyers last year who actually bought a registered property after the lockdown were all people who were previously renting properties. So they found this a great opportunity to come and buy, and we saw the age of first-time home buyers being relatively old compared to what we’d seen a decade before. And, you know, the low interest rates, the lowest in 50 years, are creating that market that you’ve just spoken about now.

In the upper [level], what we have seen that is strange in a market that’s normally robust – the middle, middle to upper middle, and even going into the upper market – is a lot of those people feeling substantial stress. And that’s unusual.

NOMPU SIZIBA: It’s a very tricky time, indeed. And, just in terms of the interest-rate environment, do you think that’s likely to remain low? And that, of course, if people can afford to buy property, even though you do see momentum coming down, should they go for it?

BERRY EVERITT: Absolutely. Because for the buyers this is a market that’s moved where sellers have fast [reached] the need to sell, and  that’s an opportunity for the buyers. So they shouldn’t be sitting on the fence. And for sellers that need to sell, they shouldn’t be sitting on the fence, either way, for the market to improve, because it might be a long while before it does with all the uncertainty. So, if you’re looking to buy upwards, this is a great opportunity to do so because the bigger properties are taking the bigger discounts.

NOMPU SIZIBA: Berry, thank you so much for your time. That was Berry Everett, CEO at the Chaz Everitt International Property Group.

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I can’t see inflation and therefore interest rates staying low for too long.

And everybody thought the Rand was going to tank after Junk status

This is the opinion of a single person

Wouldn’t read too much into it

I don’t see the word “plummet” anywhere in the interviewee’s comments so why the misleading headline? Guys, you should be better than this.

with low interest rates it will be a better year for properties.

Investment property has most likely hit the skids. However, the real pain will come when interest rates start rising and people can’t afford their interest payments, since they can’t afford a normalized interest rate of 10.5%.

It’s such a near-sighted view to buy what you can afford when property is cheap, what happens when things normalize? Often a lot of people go belly up. You can strife for better and still live within your means.

So true. Therefore, when possible, people should pay that little extra monies into their Homeloan account. It will go a long way when times get tough – interest rates rise.

If, as suggested, prices on higher value properties are dropping significantly then in the next rates review low and mid-priced properties could see a relative increase in rates as municipalities have to adjust the rate in the rand further up to match the income lost on higher value properties.

Not specifically referring to the property market, my feeling is that there will be in short term a bit of an rise (teaser) in economy before a crash. The job losses , backlog on taxes, income due stupid close of trade, will hit this country like a tsoenami. The increase of debts will be within six months be beyond control. The NCR and gov cant control,anything but blame something else to hide their stupidity People will be getting to a point that they cant give damn, paying debts or be positive for future. Hungry people steal and murder now they worry about a couple of drunks, fighting and end up in hospitals. Wait til the hungry startstart

BREAKING NEWS. Estate agent says falling prices best time to buy. Also a great idea when they are rising or flat. All other times don’t buy.

When your income is dependent on the transaction, you don’t care what the market looks like as long as the transaction happens. Therefore it will always get talked up.

That said, not unlike investment “advisors” and brokers who couldn’t really care as long as you give them your money to charge fees on.

The old estate agent of “There is no better time to buy or sell than now”

Strong in the last 6 months ?????????? BECAUSE the government departments were closed and didn’t process anything.

End of comments.

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