The news that the inflation rate has ticked up again for a second month to 5.6% in February is not what we had hoped for as the property market waits for a rate cut.
Given that the inflation rate is again near the upper limit of the Reserve Bank’s target range, the MPC is unlikely to provide any relief to the market. The best we can hope for is that there is no rate hike this week, but we remain upbeat that rate cuts will come by mid-year, Seeff says further. In the meantime, there are good deals for property buyers in the market given that price growth has stalled notably to below 1% according to the latest data from FNB. In many instances, buyers can find properties at similar prices to what they would have paid two years ago while mortgage lending continues to support buyers in the market.
Sellers, however, should be aware that limited price growth means buyers are looking to negotiate, and realistic pricing which reflects the property's value is key to attracting buyers. Agents recommend that sellers should not look to test high prices in the current market. Rather go in at the right price, if there is value, the buyer will pay the price.
Seeff says that buying in a lower market presents the opportunity to benefit from subsequent appreciation in property values once the market takes the next upswing. The same applies to sellers. If you wait for a higher price, you too will have to pay more, so consider your options.
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