Budget news from Sotheby's International Realty

Lew Geffen, chairman of Sotheby’s International Realty in SA, says Finance Minister Pravin Gordhan’s Budget achieves a good balance of spending on SA’s most urgent needs. “On the one hand, we must achieve faster growth and job creation, but on the other we have to continue to support and uplift those who are still marginalised in our economy, and we think the Minister has done very well in allocating our limited resources where they will do the most good, especially considering the ongoing undertainty in the global economy.”

From the property point of view, he says, the most immediately positive aspects of the Budget are the allocations to build 400 000 low income houses over the next three years and those to support municipalities in coping with the service demands created by rapid urbanisation, as well as the tax relief for employers who provide their employees with homes. “We simply have to eradicate informal settlements and get people into proper housing, and we have to tackle the deterioration of municipal service networks in our towns and cities because decent housing in decent surroundings is a key to becoming a winning nation.

“At the same time, what the property market really needs is more economically empowered people in a thriving economy, so we are delighted at the measures being implemented to boost job creation, including the refurbishment and re-opening of skills training centres, and the plan to create aboput 2-million new jobs through the expanded public works programme. The proposed employment tax incentives for private sector employers will also be most welcome. More homegrown employment in skilled jobs is not only the key to more home purchases, but to the social stability that encourages more investment and faster economic growth.”

Thirdly, he says, the property industry should be encouraged by the plans to reduce the tax burden on and give financial assistance to small, medium and micro-enterprises (SMMEs) that are major providers of new jobs, and the assistance that will be provided to SA companies wanting to expand into Africa as well as foreign companies who see SA’s potential as a “gateway” to the rest of the continent. “These measures, together with the billions to be spent on improving infrastructure such as roads, railways, harbours and power plants, should bring about a further significant increase in economic growth over the next few years.”

Article by: www.sothebysrealty.co.za

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