Consumers more concerned about house prices than political climate
South Africans are more worried about further interest rate hikes and unsustainable property prices than political uncertainty in 2008.
These are the findings of an online survey conducted by Propertygenie.co.za, which gauged the mood of consumers after a series of recent factors that have "buffeted the local property market".
Property owners responding to the survey were asked for their views on issues such as the introduction of the National Credit Act in June, interest rate increases and the US and European housing markets sub-prime crisis.
Johan Strydom, general manager of Propertygenie.co.za, the property search engine that lists more than 125 000 real estate agency properties nationwide, said three main factors seemed to be the main worry for local property owners.
Strydom said: "Our survey showed that 37 percent of people felt that higher interest rates are the major threat to property prices right now, while 23 percent said unsustainable house price increases posed the biggest threat. The NCA was voted the third largest risk factor with 21 percent of the votes.
"Interestingly, despite all the headline-grabbing leadership (succession) concerns, only 16 percent of people thought political uncertainty was the biggest risk factor followed by 2 percent that ranked the sub-prime crisis as the biggest problem."
Strydom added that 41 percent of the respondents said higher bond repayments from interest rate hikes had no impact on them, while nearly 17 percent said they would be selling their homes next year.
"However, higher interest rates are likely to remain a concern in the light of inflation staying above the 6 percent target level and hawkish comments from (SA Reserve Bank) Governor (Tito) Mboweni."
Propertygenie expects consumer concerns about the NCA to fade, as people and banks become familiar with the detailed disclosure requirements.
"Owning a property is fundamental to wealth creation, and owners should not panic into selling but rather look at cutting out luxury items," Strydom said. "Paying off a home loan is one of the best investments anyone can ever make."
"In the long-term they will be very glad they did," he advised."