Today’s decision by the South African Reserve Bank’s Monetary Policy Committee to keep the repo rate unchanged at 8.25% comes as no surprise for Tyson Properties CEO, Chris Tyson.
He points out that the announcement comes on a momentous day for most South Africans – the re-opening of Parliament and a peek at the plans of the Government of National Unity for the next five years as well as Mandela Day when the vision of the country’s greatest statesman is celebrated.
Tyson says that the country voted for change at the end of May and, although the outcome of the elections may have seemed indecisive for some, most South Africans remain hopeful that many of the lagging challenges will now be tackled. So far, there were indications that load shedding remains under control and that infrastructure investment will again gather momentum – developments that will not only bode well for markets but attract investment and kickstart economic recovery.
“Although there has been no drop, we are moving into very positive territory after the national elections which paves the way for a drop later this year. Meanwhile, for those who are in the market, it is a good time to buy at the lower priced properties in the market,” Tyson advised.
However, he advises sellers to continue with caution, taking special care to price their properties correctly in a highly competitive market where buyers are spoilt for choice.
Despite recent weather issues in the Western Cape, Tyson says that the property market remains as strong as ever. Reports that business confidence in KwaZulu-Natal was at its strongest in the second quarter of 2024 continue to be under pinned by a strengthening of the residential property market in the province whilst the recovery of the property sector in Gauteng also continues. The market in the Eastern Cape remains resilient, he says.
Tyson remains optimistic that the end of the South African Reserve Bank (SARB) rate hiking cycle, which began in November 2021 and brought the country’s repo rate to a 15-year high of 8.25% and the prime lending rate to 11.75%, is likely to end later this year with a cut bringing relief to many South Africans and allowing the residential property market to continue to move into positive territory. This cut will be the start of future cutting to stimulate the property market.