The recent announcement in the national budget speech presented by Finance Minister Nhlanhla Nene, that the transfer duty threshold has been raised to R750 000, is welcome for first time buyers as this would help get them on the property ladder while being able to get slightly more house than they previously would have, said Lanice Steward, managing director of Knight Frank Residential SA.
“The increased demand for properties at the lower end of the market is good for the industry because the more people own their own homes, the more stable the country’s economy will be. However,” she said, “it will still be dependent on banks granting mortgages more readily and consistently.”
It is estimated that the overall property sector in South Africa is currently worth R4,9 trillion, with the residential sector representing R3 trillion. With the residential market being far and away the biggest contributor to the economy, it is reported that in 2014 the residential property industry confirmed transactions worth R40 billion, a significant sum of the overall GDP, said Steward.
As would be expected, she said, the top three areas contributing to the property market figures were Gauteng, the Western Cape and KwaZulu Natal, representing, jointly, well over 80% of the country’s property revenue.
In addition to the revenue, estate agencies and property development companies play a huge role in the country’s employment figures, in not only employing estate agents but all of the administration and support staff needed to keep a property business running, she said.
The healthy cycle of being able to own a home is perpetuated, which then contributes more to the GDP, which then adds value and so on, said Steward.
