Buyers have been taking longer to put pen to paper on home purchases in Gauteng’s prime residential areas.
“So much so” says luxury property specialist Ronald Ennik “that a six-month time frame from the first viewing to acceptance of an offer has become quite common.”
As a result, brokers of homes in Sandton and other high end northern nodes in Johannesburg’s residential market are increasingly, and sensibly, seeking wider timeframes on sales mandates, adds the CEO of Rosebank-based Ennik Estates.
“Right now up to 80 per cent of buyers in the top end of the Jo’burg market are shopping around opportunistically, with no specific deal deadline to meet in a climate in which there is no pressure for them to transact.
“Astute buyers understand the current pace of the market – not least because they themselves have been setting it. And they have done so against a background of sentiment-sapping socio-economic and political uncertainty that is unlikely to change much before the 2014 general election.
“That is why buyers have not been responsive to the kind of ‘buy-or-miss-the-boat’ pressure that prevailed at the start of the last market upturn,” says Ennik.
“Put another way, there is no wave of pent-up buyer demand just waiting to roll out at this stage. For deals to be struck in the current climate sellers must be well priced – not over-optimistic – and buyers must expect to be more negotiable.
“That is why the ‘top-down’ seller approach (of pitching unrealistically high for a sale at the original hoped-for price) does not work in the current market as it did in the boom years,” says Ennik.
“Having said that, Ennik Estates is now seeing a slight uptick in the market – which is reflected in the fact that some homes which have been on sale for a long time are suddenly finding buyers.
“They are astute buyers who, I believe, are timing their entry, or re-entry, perfectly.
“I have been through many property ups and downs over many years – and it is a fact that it generally takes six months before people realise that the market has turned!”
Ennik Estates is the exclusive affiliate in Gauteng of Christie’s International Real Estate, the US$100-billion sales a year global luxury property arm of the world’s largest and oldest fine art auction house.