Rates decision not seen to affect property market

The decision to keep the repo rate unchanged at 6.5 percent was expected and should not have any impact on the residential market's recovery, an estate agent said on Thursday.

Interest rates were at a lower enough level to provide an impetus for the market to gradually recover, Jawitz Properties said in a statement.

"What is needed more than a drop in rates, is for the banks to continue to ease their lending requirements and for consumer confidence to improve especially at the upper and luxury end of the market," CE Herschel Jawitz said.

The lower- to middle markets, which were most interest rate sensitive, were still finding going with the banks tough.

On the luxury end, consumer confidence was the key.

"People have to feel good about what they are reading and hearing before they will think about spending R10 million on a house."

Vered Estates CEO Jonny Novick said a rate reduction would have been great news for homeowners.

However, the local housing market was still in very good shape.

"The latest property indicators are already suggesting that activity in the residential property market remained steady throughout June, which bodes well for the property market over the coming months."

Sapa

Posted at 08:57AM Jul 23, 2010 by Editor in Market  |