Slowing economic growth and tight credit have put downward pressure on home prices in several of Pretoria's eastern suburbs over the past 12 months.
“Buyers as well as sellers are affected by current economic conditions,” says Dr Willie van der Merwe, the RealNet franchiseefor the sought-after suburbs around Pretoria's Botanical Gardens. “Although the number of sales remained constant, the value of registered sales in these areas showed a year-on-year decline of 30% in November.
“Homes are also taking longer to sell, especially in the higher price ranges, and sellers arehaving to lower their asking prices in order to attract buyers. On the other hand, buyers are struggling to obtain finance, and almost 44% of the sales we concluded in the suburbs of Brummeria, Lydiana, Val de Grace. Murrayfield, Meyerspark, Silverton, Weavind Park and Nellmapiusin 2013 fell through because buyers could not obtain the requisite home loans.”
The median price of freehold homes sold in these areas in the past 12 months was R1,176m, he says, and thatof sectional title townhouses was R764 000.
“But the high interest rates offered by cautious banks, especially to first-time buyers who had not saved a deposit, torpedoed many transactions.On the other hand, buyers with financial discipline and a record of paying their bills on time who had saved even small deposits had far fewer delays in obtaining finance.”
Van der Merwe says most sellers had to contend with offers that were on average 8% lower than asking prices, and that properties generally spent longer in the market - 160 days on average compared to an average of 130 days in the previous 12 months. Only a third of sellers received offers matching their asking prices.
He adds, however, that some properties with asking prices that were in line with current market conditions sold within a week of being listed.
Registration of transfers took between 38 days for straightforward transactions up to 176 days in cases where financing problems were encountered. The transfers of distressed properties offered through the banks’ assisted selling programmes took 75 days on average.
Homebuyers in his areas, Van der Merwe says are typically between the ages of 25 and 44, while sellers are mostly older than 55. Most buyers who prefer townhouses are in the25 to 34 age group.
Article from: www.realnet.co.za
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